ESTABLISHMENT LABS HOLDINGS INC. (Form: S-1, Received: 06/21/2018 16:54:01)

As filed with the Securities and Exchange Commission on June 21, 2018.

Registration No. 333-

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM S-1

REGISTRATION STATEMENT

Under The Securities Act of 1933

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Establishment Labs Holdings Inc.

(Exact name of Registrant as specified in its charter)

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British Virgin Islands	3842	Not applicable
(State or other jurisdiction of incorporation or organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification Number)
	Building B15 and 25 Coyol Free Zone Alajuela Costa Rica +506 2434 2400

(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

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Motiva USA LLC

16192 Coastal Highway

Lewes, DE 19958

+506 2434 2400

(Name, address, including zip code, and telephone number, including area code, of agent for service)

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Copies to:



J. Casey McGlynn Elton Satusky Wilson Sonsini Goodrich & Rosati, P.C. 650 Page Mill Road Palo Alto, CA 94304 (650) 493-9300	Audrey M. Robertson Conyers Dill & Pearman Commerce House, Wickhams Cay 1 Road Town, Tortola VG1110 British Virgin Islands (284) 852 1000	Mark B. Weeks Frank F. Rahmani John T. McKenna Cooley LLP 3175 Hanover Street Palo Alto, CA 94304 (650) 843-5000

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Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ¨
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non‑accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b‑2 of the Exchange Act. (Check one):
Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	x (Do not check if a smaller reporting company)	Smaller reporting company	¨
		Emerging Growth Company	x
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act ¨

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CALCULATION OF REGISTRATION FEE
Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price ⁽¹⁾⁽²⁾	Amount of Registration Fee
Common Shares, no par value	$57,500,000	$7,158.75


(1)	Estimated solely for the purpose of computing the amount of the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended.


(2)	Includes the aggregate offering price of additional shares that the underwriters have the option to purchase.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission acting pursuant to said Section 8(a) may determine.

The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED June 21, 2018

PRELIMINARY PROSPECTUS

Common Shares

We are offering common shares. This is our initial public offering, and no public market currently exists for our common shares. We expect the initial public offering price to be between $ and $ per common share. We intend to apply to list our common shares on the Nasdaq Capital Market under the trading symbol “ESTA.”

We are an “emerging growth company” as defined under the federal securities laws. Investing in our common shares involves risks. See the section titled “Risk Factors” beginning on page 14.

Neither the Securities and Exchange Commission in the United States nor any other regulatory body has approved or disapproved of these common shares or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.




	PER SHARE	TOTAL
Initial public offering price	$	$
Underwriting discounts and commissions ⁽¹⁾	$	$
Proceeds to us, before expenses	$	$

(1) Please see the section titled “Underwriting” for additional information regarding underwriter compensation.

Delivery of the common shares in this offering is expected to be made on or about , 2018. We have granted the underwriters an option for a period of 30 days from the date of this prospectus to purchase an additional common shares. If the underwriters exercise the option in full, the total underwriting discounts and commissions payable by us will be $ and the total proceeds to us, before expenses, will be $ .

Joint Book-Running Managers



Jefferies	Cowen

Lead Manager

BTIG

Prospectus dated , 2018.

TABLE OF CONTENTS




	PAGE
Prospectus Summary	1
Risk Factors	14
Cautionary Statement Concerning Forward-Looking Statements	48
Industry and Market Data	50
Use of Proceeds	51
Dividend Policy	51
Capitalization	52
Dilution	54
Selected Consolidated Financial Data	56
Management’s Discussion and Analysis of Financial Condition and Results of Operations	58
Business	75
Management	95
Executive Compensation	102
Certain Relationships and Related Party Transactions	112
Principal Shareholders	116
Description of Share Capital	118
Material British Virgin Islands and U.S. Federal Income Tax Considerations	125
Shares Eligible for Future Sale	129
Underwriting	131
Legal Matters	138
Experts	138
Where You Can Find More Information	138
Enforceability of Civil Liabilities Under U.S. Federal Securities Laws	139
Index to Consolidated Financial Statements	F-1

We and the underwriters have not authorized any person to provide you with information different from that contained in this prospectus or any related free writing prospectus that we authorize to be distributed to you. We and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may provide you. This prospectus is not an offer to sell, nor is it seeking an offer to buy, these securities in any state where the offer or sale is not permitted. The information in this prospectus speaks only as of the date of this prospectus unless the information specifically indicates that another date applies, regardless of the time of delivery of this prospectus or of any sale of the securities offered hereby.

Through and including , 2018 (25 days after the date of this prospectus), all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

No action is being taken in any jurisdiction outside the United States to permit a public offering of the common shares or possession or distribution of this prospectus in that jurisdiction. Persons who come into possession of this prospectus in jurisdictions outside the United States are required to inform themselves about and to observe any restrictions as to this offering and the distribution of the prospectus applicable to that jurisdiction.

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CONVENTIONS THAT APPLY TO THIS PROSPECTUS

Except where the context requires otherwise and for purposes of this prospectus only:


▪	“GAAP” refers to the Generally Accepted Accounting Principles in the United States.


▪	“Establishment Labs,” “we,” “us,” “our” or “company” refer to Establishment Labs Holdings Inc. and its subsidiaries.


▪	“FDA” refers to the United States Food and Drug Administration.


▪	“U.S.” or “United States” refers to the United States of America.


▪	“EU” refers to the European Union.


▪	“$”, “U.S. do llars” or “USD” refers to the legal currency of the United States.

The financial statements of our foreign subsidiaries whose functional currencies are the local currencies are translated into U.S. dollars for consolidation as follows: assets and liabilities at the exchange rate as of the applicable balance sheet date, shareholders’ equity at the historical rates of exchange, and income and expense amounts at the average exchange rate for the month. Translation adjustments resulting from the translation of the subsidiaries’ accounts are included in “Accumulated other comprehensive income.” Transactions denominated in currencies other than the applicable functional currency are converted to the functional currency at the exchange rate on the transaction date. At period end, monetary assets and liabilities are remeasured to the functional currency using exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are remeasured at historical exchange rates. Gains and losses resulting from foreign currency transactions are included within “Other income (expense), net.” See Note 2 in the notes to our consolidated financial statements included elsewhere in this prospectus for more information.

We own or have rights to trademarks and trade names that we use in connection with the operation of our business, including Establishment Labs and our logo as well as other brands such as Motiva Implants, SilkSurface/SmoothSilk, VelvetSurface, ProgressiveGel, TrueMonobloc, BluSeal, Divina, Ergonomix and MotivaImagine, among others. Other trademarks and trade names appearing in this prospectus are the property of their respective owners. Solely for your convenience, some of the trademarks and trade names referred to in this prospectus are listed without the ® and ^TM symbols, but we will assert, to the fullest extent under applicable law, our rights to our trademarks and trade names.

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PROSPECTUS SUMMARY

This summary highlights information contained elsewhere in this prospectus. You should read the following summary together with the more detailed information appearing in this prospectus, including the sections titled “Risk Factors,” “Selected Consolidated Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business,” and our consolidated financial statements and related notes before deciding whether to purchase our common shares.

Business Overview

We are a medical technology company focused on improving patient safety and aesthetic outcomes, initially in the breast aesthetics and reconstruction market. Our line of silicone gel-filled breast implants, branded as Motiva Implants, is the centerpiece of our MotivaImagine medical technology platform. Post-market surveillance data, which was not generated in connection with an FDA PMA approval study and was self-collected rather than collected at mandatory follow-ups, and published third-party data indicates that Motiva Implants show low rates of adverse events (including rupture, capsular contracture, and safety related reoperations) that we believe compare favorably with those of our competitors. We believe the proprietary technologies that differentiate our Motiva Implants enable improved safety and aesthetic outcomes and have helped drive our revenue growth. Our MotivaImagine platform enables surgical techniques that we promote as Motiva branded surgeries. We have developed other complementary products and services on our MotivaImagine platform, which are aimed at further enhancing patient outcomes.

To date, most of our revenues have been generated from sales of our Motiva Implants. We began selling Motiva Implants outside the United States in October 2010; since then, we have introduced four generations of Motiva Implants, and Motiva Implants are now sold in over 60 countries, including nine of the top ten countries for breast augmentations in 2016 according to the International Society of Aesthetic Plastic Surgery, or ISAPS. We currently sell our products either via exclusive distributors or, in certain countries, our direct sales force. We received approval of an investigational device exemption, or IDE, from the FDA in March 2018 to initiate our Motiva Implant clinical trial in the United States. The first patient in the study was enrolled in April 2018, and we anticipate completing enrollment in early 2019. The results of the study are expected to support a pre-market approval, or PMA, submission to the FDA.

We have assembled a broad portfolio of intellectual property related to our medical device and aesthetics products. We believe this intellectual property, combined with proprietary manufacturing processes and the regulatory approvals we have successfully obtained outside of the United States , provides us with a strong market position. As of April 30, 2018, we own or have rights to three issued and seven pending patents in the United States related to various aspects of our Motiva implants (such as implant barrier layers, surface texture technology, minimally invasive implant delivery systems, and our QInside Safety Technology radio frequency identification devices). In addition, we have six pending foreign applications and six pending PCT applications. We intend to continue to expand our intellectual property portfolio and, combined with our Motiva Implants’ favorable safety profile, obtain FDA approval and drive Motiva’s adoption in the United States, which represents the largest breast augmentation market.

Our revenue for 2015, 2016 and 2017 was $9.6 million, $19.8 million and $34.7 million , respectively, an increase of $10.2 million, or 106%, in 2016 compared to 2015, and an increase of $14.9 million , or 75% , in 2017 compared to 2016 . Net losses increased from $1.6 million in 2015 to $22.2 million in 2016 , and further increased to $34.9 million in 2017 , an increase of 57% compared to 2016. As of December 31, 2017 , we had an accumulated deficit of $67.9 million .

Our revenue for the three months ended March 31, 2017 and 2018 was $6.9 million and $14.8 million , respectively, an increase of $7.9 million , or 114% . Net losses increased from $5.0 million for the three months ended March 31, 2017 to $6.5 million for the three months ended March 31, 2018 . As of March 31, 2018 , we had an accumulated deficit of $74.4 million .

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Our Market Opportunity

Breast augmentation surgery remains the leading aesthetic surgical procedure by number of procedures globally. Approximately 1.65 million breast augmentations were performed worldwide in 2016, according to ISAPS. In addition, according to MarketsandMarkets’ Medical Aesthetics Market - Forecast to 2021 report of November 2016, the global breast implant market was estimated at approximately $1.15 billion in 2016 and is expected to grow at a compound annual growth rate of approximately 8.5% through 2021. The following table lists the top markets by country for total breast augmentations in 2016 according to ISAPS.



Total Breast Augmentation Procedures
Rank *	Country	Procedures	% of World-Wide Total
1	United States	331,122	20.1%
2	Brazil	217,085	13.2%
3	Russia	84,235	5.1%
4	Mexico	62,206	3.8%
5	Italy	54,128	3.3%
6	Germany	52,209	3.2%
7	France	47,510	2.9%
8	Spain	46,493	2.8%
9	Columbia	44,080	2.7%
10	Turkey	38,484	2.3%
* Rankings are based solely on those countries from which a sufficient survey response was received and data were considered to be representative.

Traditional Breast Implants and Their Limitations

Despite the global demand for breast augmentation procedures, there has been relatively little innovation since the 1990s. In 1992, due to emerging safety concerns, the FDA placed a moratorium on sales of silicone breast implants in the United States that was lifted in 2006. This, combined with the ongoing FDA requirement for a PMA on all new breast implants, has discouraged breast implant innovation over the past 30 years. Current products have relatively high adverse event rates, and we believe many do not mimic natural breast tissue. The table below contains selected adverse event information from published data from the PMA clinical trials conducted by the only three companies currently approved to market silicone breast implants in the United States.




	Sientra 5-Year	Allergan 6-Year	Mentor 6-Year
Number of Patients	N=1,788 Patients	N=455 Patients ⁽¹⁾	N=1,008 Patients
Ruptures ⁽²⁾	1.8%	5.5%	3.7%
Capsular Contracture	9.0%	14.8%	13.4%
Reoperations	23.8%	28.0%	26.1%

Each of these prospective studies was conducted at multiple sites in the United States and submitted by each of these companies as their core study supporting approval, as that term is defined in the FDA Guidance on Breast Implants. Sientra, Inc., Mentor Worldwide LLC (a division of Johnson & Johnson), and Allergan plc studies commenced in 2002, 2000, and 1998, respectively, and the results described above were released in 2012, 2009, and 2007, respectively. Five-year and six-year data was chosen to increase comparability to our six-year data.
Kaplan-Meier risk rates were the primary method of analysis for the above data.
(1) Adverse events in the study were derived from the primary augmentation cohort. The overall patient population in the study was 715 patients.
(2) The total for Sientra is based on the total patient population in the study, and the totals for Allergan and Mentor are based on a substudy cohort of patients who underwent an MRI, which is lower than the overall number of patients participating in the study.

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S ubsequent to each of their PMAs in the U.S., our competitors have released results from their individual 10-year prospective clinical trials. The table below contains published data from these clinical trials relating to primary augmentations, which is the first time a patient receives an aesthetic breast implant operation.

Results from Primary Augmentations




	Sientra 10-Year	Allergan 10-Year	Mentor 10-Year
Number of Patients	N=1,116 Patients	N=455 Patients	N=552 Patients
Ruptures ⁽¹⁾	8.5%	9.3%	24.2%
Capsular Contracture	12.9%	18.9%	12.1%
Reoperations	24%	36.1%	25.5%

Kaplan-Meier risk rates were the primary method of analysis for the above data. This table represents the final data from the primary cohort of the same study referenced in the above five- and six-year PMA studies conducted by our competitors. This 10-year data for Sientra, Allergan and Mentor were released in 2018, 2018, and 2015, respectively.
(1) The rupture rates represent the MRI cohort only for each respective study, which consists of 571 patients for Sientra, 158 patients for Allergan and 202 patients for Mentor.

Our Clinical Data

We believe that the improved appearance, feel and patient safety profile of our Motiva Implants provides a strong competitive advantage that will help us to both capture market share and achieve higher patient conversion rates by addressing the key concerns described by patients who choose not to pursue breast augmentation surgery. We believe Motiva Implants have demonstrated a safety profile that compares favorably with our primary competitors based on the following data.

Our Postmarket Surveillance Data

Our postmarket surveillance data indicate capsular contracture and reoperation for adverse events of less than 0.1%, which was collected from procedures performed outside of the United States between October 2010 and March 2018. In contrast to the above competitor data, our data is self-reported rather than collected at mandatory follow-ups and was generated solely for our postmarket surveillance instead of in connection with an FDA PMA approval study.




		Motiva Implants
Number of Implants		N=446,773 Implants ⁽¹⁾
Rupture		< 0.1%
Capsular Contracture		< 0.1%
Reoperation for Adverse Events		< 0.1%
Reoperation (All Causes)		N/A ⁽²⁾

(1) Data is internally tracked on an individual implant basis rather than by patient.
(2) Complaint database does not capture reoperations for reasons not related to safety.

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Third-Party Retrospective Data

An independent study by Sforza et al., published in the peer-reviewed Aesthetic Surgery Journal in 2017, conducted between April 2013 and April 2016, reported 5,813 consecutive cases of breast augmentation with Motiva Implants. This independent study was not commissioned by us, but Dr. Sforza is a member of our medical advisory board and receives compensation from us in such capacity. The study reported overall rates of complication and reoperation of 0.76% over an interval of three years. All procedures were performed in a single center (Dolan Park Hospital, Bromsgrove, England) by a group of 16 plastic surgeons. There were no serious adverse events and no cases of implant rupture for device failure, capsular contracture (Baker III/IV) in primary cases, double capsules, or late seromas. The authors presented consistent real-world data and believe that their free, three year aftercare system is a strong method for patient retention and follow-up by eliminating any financial limitations for patients to return for follow-up consultations if any issues occur. Anecdotally, the same group of surgeons utilizing the same aftercare system for the last seven years reported substantially different results utilizing other types of silicone breast implants (i.e, non-Motiva Implants). The overall revision rate for this group from 2010 to 2013 utilizing a different, macro-textured, FDA approved implant (N > 10,000) was 8.43%, which is more than 10 times higher than the rate for Motiva Implants reported in this analysis.

(1) Name of FDA approved competitors have not been published.

Our Prospective Data

We are also conducting a 10-year prospective trial in 233 patients in Costa Rica to assess the safety profile and patient satisfaction of Motiva Implants. Interim results from the current study include six-year data for 35 patients and three-year data for 79 patients, and to date there have been no reported implant ruptures, capsular contractures or adverse event-related reoperations in these patient cohorts.

We have started a U.S. trial directed at FDA approval with similar endpoints to this prospective trial with patient populations similar to those of our competitors. The first patient in the study was enrolled in April 2018, and we anticipate completing enrollment in early 2019.

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Our Products and Technologies

The key characteristics of our primary products are described in the table below:



Product	Motiva Implants	Divina	Puregraft

Description	Soft silicone-gel filled breast implants with improved appearance, feel and safety	3D simulation device and proprietary tissue modeling software	Autologous graft of healthy, viable adipose (fat) cells for filling and contouring
Product Catalog	Available in more than 1,000 product variations, including four projection heights	For use with breast surgeries	Available in three graft volumes: 50cc, 250cc, and 850cc
Key Features	▪ SilkSurface/SmoothSilk shell surface ▪ ProgressiveGel PLUS, ProgressiveGel Ultima, Silicone filling gels ▪ Ergonomix design ▪ TrueMonobloc construction ▪ QInside Safety Technology RFID microtransponder ▪ BluSeal shell barrier layer	▪ Pre-operative 3D planning that enables patients and physicians to visualize post-surgical result and measure pre-existing breast volume to optimize implant selection ▪ May increase clinical consultation efficiency ▪ MotivaHybrid: fat grafting can be used in conjunction with Motiva Implants by measuring pre-existing volume of the breast and calculating the appropriate ratio between silicone implant and fat graft	▪ Purifies adipose tissue through selective filtration technology ▪ Self-contained purification process preserves sterility ▪ Can be used in conjunction with Motiva Implants ▪ We are the exclusive distributor outside of the United States and Canada
Sales Territories	Over 60 countries outside the United States including nine of the top ten markets by country for total breast augmentations in 2016

Motiva Implants

Current generation Motiva Implants utilize our proprietary Ergonomix design, a round and oval-base implant that responds to gravity and movement in ways that more closely mimic natural breast tissue. We believe that our favorable safety profile and patient satisfaction rates are attributable to our differentiating technologies, which include:


▪	SilkSurface/SmoothSilk is a smooth bio-engineered cell-friendly surface characterized by a uniformly high density of hierarchical micro/nano surface features, designed to reduce the body’s inflammatory reactions to our implants, which is intended to lower rates of complications like capsular contracture and seroma.


▪	Silicone gel rheologies consists of highly purified biocompatible gels with specific visco-elastic properties that we believe enables Motiva Implants to respond to the patient’s motion in ways that more closely mimic the appearance, feel and movement of natural breast tissue under the brand names of ProgressiveGel PLUS and ProgressiveGel Ultima.


▪	TrueMonobloc technology, which uses specific silicone chemistry and our proprietary manufacturing processes to allow for all components to be bonded for increased elasticity and ductility compared with silicone implants produced by our competitors.


▪	BluSeal technology, a proprietary colored layer of low-permeability silicone within the implant shell, gives a visual indicator of the layer integrity during the manufacturing process. This technology also helps surgeons confirm whether the barrier layer has defects, or other imperfections, before implantation that might lead to post-implantation shell rupture or gel bleed.

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▪

QInside Safety Technology provides a Radio-Frequency Identification Device, or RFID, microtransponder embedded within the gel of the implant that gives surgeons the ability to non-invasively check each implant’s unique identification number with an RFID reader. The microtransponder contains only a unique 15 digit code that identifies the product, and does not contain any patient information. Surgeons can also access implant-related information, such as implant type, size, and other characteristics, either through our Motiva implants website or the MotivaImagine application. Surgeons can only view patient-specific information after the patient or the surgeon creates a secure account and registers the products and applicable patient name. The MotivaImagine application and Motiva implants website also allow the patient to access the implant warranty information.


▪	Our design, which allows all implants to be 100% filled, is intended to reduce the risk of creases in the shell that could create shell weakness and rupture.

Divina 3D Simulation System

We sell our Divina 3D simulation systems to plastic surgeons for use in pre-surgical patient consultations and planning. Divina utilizes a combination of 3D imaging hardware and proprietary Tissue Behavior Simulation, or TBS, software to give physicians and patients the ability to visualize the potential aesthetic results of a procedure and various implant sizes in real time. We believe that the addition of a Divina system to a clinic will facilitate an increase in the number of patients who chose to proceed from a consultation to a surgical procedure.

Puregraft

In September 2016, we became the exclusive distributor of the Puregraft line of products outside the United States and Canada. Puregraft is used to remove blood, lipids and other components from adipose tissue, primarily leaving the viable adipose cells for reinjection into areas of the patient’s body where additional soft tissue volume or contouring is desired. Known as an autologous adipose tissue graft, these procedures are utilized primarily in breast augmentation and reconstruction, facial enhancement, and body contouring. In an independent study by Gerth et al. reported in the peer-reviewed Aesthetic Surgery Journal in 2014 conducted between November 2010 and November 2012, 26 patients that had received autologous adipose tissue grafts for facial contouring processed via Puregraft had significantly higher long-term retention of volume when compared to 33 patients that had received grafts processed using conventional means, with statistical significance being determined by a p-value of 0.03. In another independent study conducted by Sforza et al. at Dolan Park Hospital published in the Aesthetic Surgery Journal in 2016, in the breast augmentation setting, a clinical study of 26 patients, whose implant procedures were subsequently enhanced with Puregraft-enabled grafts between April 2013 and October 2014, resulted in approximately 73% of fat volume being retained by patients at one year, and 96% of patients reported satisfaction with the outcome. The initial term of our distribution agreement with Puregraft ends in September 2019, but we have the ability to renew the agreement at the end of the initial term if we wish to do so and meet certain minimum purchase requirements.

Branded Surgeries

Our suite of products and technologies enables surgical techniques that we intend to develop and promote as “branded surgeries.” Our first such branded surgery, MotivaHybrid, combines 3D pre-surgical assessment of existing breast tissue volume using either our Divina system or another 3D scanning system, together with Motiva Implants and Puregraft autologous adipose tissue grafts. The MotivaHybrid method is designed to enable surgeons to optimize silicone volume using Motiva Implants and balance the ratio of silicone to tissue with additional contouring using Puregraft for more natural balanced results and improved patient satisfaction. Our second branded surgery, Motiva MinimalScar, allows surgeons to significantly reduce the size of the surgical incision by using our proprietary MotivaImagine Ultralight LED Retractor in conjunction with the Motiva Insertion Sleeve. We are also developing Motiva Minimally Invasive Natural Technique, or Motiva MINT — a family of branded surgeries that we anticipate will allow breast augmentation through small incisions. We intend for Motiva MINT to allow breast augmentation procedures to be performed under local anesthesia rather than general anesthesia, with faster recovery times and a resulting reduction of surgical complications. The implants associated with Motiva MINT have been developed, and we currently intend to begin the CE marking process in 2018. Instruments and special devices for the Motiva MINT procedure are currently being prototyped and tested and will require regulatory approval prior to commercialization. We believe Motiva MINT will be able to attract new customers and expand the market for breast aesthetic procedures.

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MotivaImagine Centers

We utilize our MotivaImagine Center initiative, which are collaborations with plastic surgery clinics whereby we provide them with access to our technologies and the ability to brand themselves as a MotivaImagine Center. In exchange for these services and use of the Motiva branding, each MotivaImagine Center commits to use Motiva Implants and other products in the MotivaImagine product platform. Before certifying a MotivaImagine Center, we ensure that the center offers:


▪	either our Divina or AX3 3D simulator, or a third party cloud-based visualization software that we sell in partnership with Crisalix systems;


▪	access to the full suite of MotivaImagine products that complement Motiva Implants;


▪	surgical staff trained by Establishment Labs in the optimal use of MotivaImagine products; and


▪	branding and design elements, according to company guidelines, that are intended to create a more luxurious and reassuring experience for patients.

Since 2016, 28 independent clinics outside the United States have elected to become MotivaImagine Centers, and we are pursuing enrollment of additional centers as a key component of our sales and marketing strategy. We also intend to utilize the network of MotivaImagine Centers as a channel for other future aesthetic surgical products on our MotivaImagine platform .

Our Competitive Strengths


▪	Patient-centric innovative implant technologies. We have developed our Motiva Implants by enhancing and creating novel product components for our implants, and then combining these components into products that deliver improved aesthetic outcomes, increased patient satisfaction and favorable safety profiles.

▪

Extensive suite of complementary products and services. Our MotivaImagine product portfolio includes innovative products such as Divina 3D surgical simulation systems, Puregraft autologous fat grafting systems, and other surgical tools. We believe our branded surgical procedures, such as MotivaHybrid, Motiva MinimalScar and Motiva MINT, will address key unmet needs for both the physician and the patient.

▪

Proprietary internal manufacturing processes and capabilities. We manufacture our silicone products in state-of-the-art manufacturing facilities in Costa Rica rather than relying on third-party manufacturers. In these facilities, we utilize our novel 3D imprinted molding method to create proprietary surface features that, in combination with other proprietary materials and methods, differentiate our products from those of our competitors. Our two manufacturing sites have gone through full site inspections and audits under the Medical Device Single Audit Program, or MDSAP, which were carried out by the British Standards Institute, or BSI, an agency which the FDA accepts as a substitute for routine agency inspections. We believe our modern facilities, focus on product quality and deep technological know-how have helped us establish and maintain a brand of consistency, quality and safety.


▪	Dynamic worldwide sales platform. We sell our products both through exclusive arrangements with leading local distributors who have strong local surgeon relationships and our direct sales force in key markets such as Brazil and certain countries in Europe. Using this market specific approach, we have built an effective and efficient worldwide sales platform.


▪	Proven management team with expansive industry experience. We have a highly experienced management team that is comprised of leaders from the medical aesthetic market.

Our Growth Strategy

Our goal is to be the global leader in aesthetic surgical implant technology, including breast implants, while improving patient safety through product innovation. The key elements of our strategy include:


▪	Expand revenues in existing markets. We believe we can continue to grow market share in our existing markets due to the favorable safety profile and improved aesthetic outcomes of our Motiva Implants.

▪

Launch Motiva Implants in additional markets outside the United States . We expect that continued geographic expansion will be a key driver of growth in the near term. During 2016 and 2017, we started sales through distributors in Australia, Israel, Russia, Saudi Arabia and South Korea, as well as starting direct sales in Brazil, the second largest market for breast augmentations. Expansion into new countries in the Asia-Pacific region (China, India, Taiwan and Thailand) is expected in the next several years .


▪	Obtain FDA approval and enter the U.S. market. We are conducting our IDE clinical trial in the United States, with the goal of obtaining approval from the FDA for a premarket application, or PMA, and commercializing our Motiva Implants in the United States. The first patient in the study was enrolled in April 2018, and we anticipate completing enrollment in early 2019.

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▪

Optimize patient conversion through sales and marketing programs. Our MotivaImagine Centers enable us to engage with and educate patients on the Motiva brand and the benefits of our products, as well as increase clinical efficiency for our physician collaborators. In the future, we expect our MotivaImagine Centers to have important strategic synergies with our branded surgeries, which are promoted globally. We employ a multi-faceted marketing strategy that includes social media engagement, conferences, advertisements and education.

▪

Seek out and pursue strategic acquisitions. We intend to seek out other innovative products, services and branded procedures that meet unmet needs in the aesthetics space and complement our existing product portfolio, and we believe this can be additive to future revenue growth. We have purchased distributor networks in strategic markets and may acquire other third party sales organizations in the future. While we have no specific acquisitions or planned licensing agreements, we may engage in these, or other strategic transactions, with the goal of augmenting our existing product portfolio and global footprint.

▪

Continue a high level of engagement with key opinion leaders. We promote Motiva Implants, in part, via an extensive and robust calendar of physician education events led by key opinion leaders in the field of aesthetic surgery. In 2018, we plan to conduct approximately 70 events through our MotivaEdge educational platform. We also collaborate with key opinion leaders to identify and develop new clinical applications for our existing products, as well as new product and strategic opportunities.

Selected Risk Factors Associated with Our Business

Our business is subject to numerous risks and uncertainties, as more fully described in the section titled “Risk Factors” immediately following this prospectus summary. You should read these risks before you invest in our common shares. These risks include, among others:


▪	We expect to incur losses for the foreseeable future, and our ability to achieve and maintain profitability depends on the commercial success of our Motiva Implants, which represents over 85% of our revenues.


▪	We have a limited operating history and may face difficulties encountered by companies early in their commercialization in competitive markets, particularly companies that develop and sell medical devices.


▪	Motiva Implants are not currently approved for commercial sale in the United States. Obtaining such approval is costly and time consuming, and we may not obtain the regulatory approval required to sell our products in the United States.


▪	There is no guarantee that the FDA or non-U.S. regulatory agencies will grant approval for our current or future products, and failure to obtain regulatory approvals in the United States and other international jurisdictions, or revocation of approvals in those jurisdictions, will prevent us from marketing our products.


▪	We expect to significantly increase the size of our organization; as a result, we may encounter difficulties in managing our growth, which could disrupt our operations and/or increase our net losses.

▪

We rely on a single-source, third-party supplier for medical-grade long-term implantable silicone, which is the primary raw material used in our Motiva Implants. If this supplier were to increase prices for this raw material over time or experience interruptions in its ability to supply us with this raw material, our business, financial condition and results of operations could be adversely affected.


▪	Various factors outside our direct control may adversely affect manufacturing and supply of our breast implants, tissue expanders and other products.


▪	Negative publicity, product defects and any resulting litigation concerning our products or our competitors’ products could harm our reputation and reduce demand for silicone breast impl ants, either of which could negatively impact our financial results.

▪

Commercial success of Motiva Implants in the United States or elsewhere depends on our ability to accurately forecast customer demand and manufacture sufficient quantities of product in the implant sizes that patients and physicians request, and to manage inventory effectively and the failure to do so could have a material adverse effect on our business, financial condition, results of operations and growth prospects.


▪	If we are not able to obtain and maintain intellectual property protection for our products and technologies, or if the scope of our patents is not sufficiently broad, we may not be able to effectively maintain our market leading technology position.

If we are unable to adequately address these and other risks we face, our business, financial condition, operating results and prospects may be adversely affected.

Implications of Being an Emerging Growth Company

In addition, we are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act, or the JOBS Act, enacted in April 2012, and therefore we intend to take advantage of certain exemptions from various public company reporting requirements, including not being required to have our internal control over financial reporting

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audited by our independent registered public accounting firm pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in this prospectus, our periodic reports and proxy statement and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and any golden parachute payments not previously approved. We may take advantage of these exemptions for up to five years or until we are no longer an “emerging growth company.”

Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. W e have elected to take advantage of the extension of time to comply with new or revised financial accounting standards available under Section 102(b) of the JOBS Act.

Corporate Information

We were reorganized under a parent holding company in the British Virgin Islands on October 9, 2013. Prior to that we operated as Establishment Labs, S.A., a Sociedad Anónima incorporated in Costa Rica, which was established in Costa Rica on January 18, 2004. Our registered office is located at P.O. Box 3140, Commerce House, Wickhams Cay 1, Road Town, Tortola VG1110, British Virgin Islands, and our telephone number at this address is +1 (284) 852-1010. Our principal place of business in Costa Rica is located at Alajuela, Coyol Free Zone, Buildings B15 and 25. Our telephone number at this address is +506 2434 2400. Our website address is www.establishmentlabs.com. The information contained on our website is not incorporated by reference into this prospectus, and you should not consider any information contained on, or that can be accessed through, our website as part of this prospectus, or in deciding whether to purchase our securities. Our agent for service of process in the United States is our wholly-owned subsidiary, Motiva USA LLC, a Delaware limited liability company, domiciled at 16192 Coastal Highway, Lewes, DE 19958 .

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THE OFFERING



Common shares offered by us	shares
Option to purchase additional shares	We have also granted the underwriters an option for a period of 30 days from the date of this prospectus, to purchase an additional common shares from us at the public offering price less the underwriting discount.
Common shares to be outstanding after this offering	shares, or shares if the underwriters exercise their option to purchase additional common shares in full.
Use of proceeds	We estimate the net proceeds from this offering will be approximately $ million, or approximately $ million if the underwriters exercise their option to purchase additional shares in full, at an assumed initial public offering price of $ per common share, the midpoint of the price range on the cover page of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.
	We intend to use the net proceeds from this offering (i) to fund our planned PMA clinical trial for Motiva Implants and related costs; (ii) to repay approximately $5.0 million in promissory notes issued to former Class Z preferred shareholders; and (iii) to fund working capital and other general corporate purposes. See the section titled “Use of Proceeds” for additional information.
Risk factors	See the section titled “Risk Factors” and the other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in our common shares.
Proposed Nasdaq Capital Market symbol	“ESTA”

The number of common shares to be outstanding after this offering is based on 14,771,383 shares outstanding as of March 31, 2018 and excludes:


▪	983,739 common shares issuable upon the exercise of share options outstanding as of March 31, 2018 granted under our 2015 Equity Incentive Plan with a weighted-average exercise price of $6.74 per share;


▪	145,000 common shares issuable upon the exercise of warrants outstanding as of March 31, 2018 with an exercise price of $3.80 per share;


▪	433,031 common shares issuable upon the vesting of restricted stock awards outstanding as of March 31, 2018, under our 2015 Equity Plan;


▪	625,000 Class G-1 ordinary shares issued to RTW Investments’ affiliated entities and 285,559 Class G ordinary shares issued to several investors after March 31, 2018;


▪	up to 100,000 common shares reserved for issuance in connection with acquisition-related obligations; and

▪

common shares reserved for future issuance under our equity compensation plans, consisting of (i) common shares initially reserved for issuance under our 2018 Equity Incentive Plan, which we expect to be effective on the business day immediately prior to the date of the effectiveness of the registration statement of which this prospectus forms a part (if approved by our shareholders) upon completion of this offering, and (ii) common shares initially reserved for issuance under our 2018 Employee Share Purchase Plan, which we expect to be effective on the business day immediately prior to the date of the effectiveness of the registration statement of which this prospectus forms a part (if approved by our shareholders). Our 2018 Equity Incentive Plan and 2018 Employee Share Purchase Plan also provide for

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automatic annual increases in the number of shares reserved under such plans each year, as more fully described in the section titled “Executive Compensation-Employee Benefit and Share Plans.”

Unless otherwise indicated, all information in this prospectus reflects and assumes the following:


■	the conversion of all of our outstanding ordinary shares into an aggregate of 14,771,383 common shares immediately prior to the completion of this offering;


■	the adoption of our amended and restated memorandum and articles of association and the filing of our amended and restated memorandum and articles of association with the registrar of corporate affairs in the British Virgin Islands immediately prior to the completion of this offering; and


■	no exercise of the underwriters’ option to purchase additional shares.

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SUMMARY CONSOLIDATED FINANCIAL DATA

The following tables summarize our financial data and should be read together with the sections titled “Selected Consolidated Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes included elsewhere in this prospectus.

We have derived the consolidated statements of operations data for the years ended December 31, 2016 and 2017 and the balance sheet data as of December 31, 2017 from our audited consolidated financial statements included elsewhere in this prospectus. We have derived the consolidated statements of operations data for the year ended December 31, 2015 from our audited consolidated financial statements not included in this prospectus. We have derived the consolidated statements of operations data for the three months ended March 31, 2017 and 2018 and the balance sheet data as of March 31, 2018 from our unaudited condensed consolidated interim financial statements included elsewhere in this prospectus. Our historical results presented below are not necessarily indicative of financial results to be achieved in future periods.




	Years Ended December 31,									Three Months Ended March 31,
	2015			2016			2017			2017			2018
										(unaudited)
	(in thousands, except share and per share data)
Consolidated Statements of Operations Data:
Revenue	$	9,594		$	19,801		$	34,681		$	6,919		$	14,816
Cost of revenue	4,623			9,705			16,979			3,509			6,901
Gross profit	4,971			10,096			17,702			3,410			7,915
Operating expenses:
Sales, general and administrative	4,727			23,189			30,821			5,849			8,648
Research and development	604			2,740			6,864			1,503			2,147
Total operating expenses	5,331			25,929			37,685			7,352			10,795
Loss from operations	(360		)	(15,833		)	(19,983		)	(3,942		)	(2,880		)
Interest expense	(955		)	(3,413		)	(10,420		)	(927		)	(2,171		)
Change in fair value of derivative instruments	(182		)	(2,484		)	(2,428		)	(286		)	(1,305		)
Other income (expense), net	(97		)	(295		)	(1,961		)	161			(164		)
Loss before income taxes	(1,594		)	(22,025		)	(34,792		)	(4,994		)	(6,520		)
Provision for income taxes	—			(134		)	(105		)	(5		)	(10		)
Net loss	$	(1,594	)	$	(22,159	)	$	(34,897	)	$	(4,999	)	$	(6,530	)
Cumulative dividend relating to ordinary shares	(171		)	—			—			—			—
Dividend relating to ordinary shares	(623		)	—			—			—			—
Net loss attributable to ordinary shareholders	$	(2,388	)	$	(22,159	)	$	(34,897	)	$	(4,999	)	$	(6,530	)

Basic and diluted net loss per share attributable to non-participating ordinary shareholders	$	(0.54	)	$	(3.42	)	$	(3.41	)	$	(0.75	)	$	(0.45	)
Basic and diluted net loss per share attributable to participating ordinary shareholders	$	(0.81	)	$	—		$	—		$	—		$	—
Weighted average outstanding non-participating ordinary shares used for net loss per share attributable to ordinary shareholders	4,413,194			6,482,249			10,230,586			6,633,635			14,662,092
Weighted average outstanding participating ordinary shares used for net loss per share attributable to ordinary shareholders	2,173,663			—			—			—			—

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(1)	See Note 13 to our consolidated financial statements and Note 12 to our condensed unaudited interim financial statements included elsewhere in this prospectus for an explanation of the method used to calculate net loss per share, basic and diluted, and the number of shares used in the computation of the per share amounts.




	March 31, 2018
	(unaudited)
	Actual			Pro Forma (1)	Pro Forma As Adjusted (2)(3)
	(in thousands)
Consolidated Balance Sheet Data:
Cash	$	6,613		$	$
Working capital (deficit)	20,678
Total assets	59,016
Long-term debt, net of debt discount and issuance costs	19,908
Other liabilities, long term	26,970
Total liabilities	67,776
Total shareholders’ equity (deficit)	(8,760		)


(1)	The pro forma column reflects the conversion of all of our outstanding ordinary shares into an aggregate of 14,771,383 common shares immediately prior to the completion of this offering.

(2)

The pro forma as adjusted column further reflects (i) the sale by us of common shares in this offering at an assumed initial public offering price of $ per common share, the midpoint of the price range set forth on the cover page of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us, and (ii) the repayment of $5.0 million to fund the repayment of indebtedness due to former Class Z preferred shareholders pursuant to promissory notes we issued to such holders in exchange for such shares.

(3)

Each $1.00 increase (decrease) in the assumed initial public offering price of $ per common share would increase (decrease) each of cash, working capital (deficit), total assets and shareholders’ equity (deficit) by $ million, assuming the number of shares we are offering, as set forth on the cover page of this prospectus, remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. We may also increase or decrease the number of shares we are offering. Each increase (decrease) of 1,000,000 shares in the number of shares we are offering would increase (decrease) each of cash, working capital (deficit), total assets and total shareholders’ equity (deficit) by approximately $ million, assuming the assumed initial public offering price per share, as set forth on the cover page of this prospectus, remains the same. The pro forma as adjusted information is illustrative only, and will be adjusted based on the actual initial public offering price, number of shares offered and other terms of this offering determined at pricing.

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RISK FACTORS

Investing in our common shares involves a high degree of risk. The following risk factors describe circumstances or events that could have a negative effect on our business, financial condition or operating results. You should consider the following risks carefully, together with all the other information in this prospectus, including our consolidated financial statements and notes thereto, before you invest in our common shares. If any of the following risks occur, our business, financial condition, or operating results, could be adversely affected. As a result, the trading price of our common shares could decline and you could lose part or all of your investment. Additional risks and uncertainties not currently known to us or that we currently believe are not material could also impair our business, financial condition or operating results.

Risks Related to the Development and Commercialization of Our Products

We expect to incur losses for the foreseeable future, and our ability to achieve and maintain profitability depends on the commercial success of our Motiva Implants, which represents over 85% of our revenues.

We have incurred losses to date and expect to continue to incur losses for the foreseeable future. In 2017, sales of our Motiva Implants accounted for over 85% of our revenues, and we expect our revenues to continue to be driven primarily by sales of these products. In order to achieve and sustain profitability, our revenues from these products will need to grow beyond the levels we have achieved in the past. If physicians and/or patients do not perceive our products to be competitive in features and safety when compared to other products in the market, or if demand for our Motiva Implants or for breast implants in general decreases, we may fail to achieve sales levels that provide for future profitability.

Our ability to successfully market Motiva Implants and our other current and future offerings depends on numerous factors, including but not limited to:


▪	the outcomes of current and future clinical studies of Motiva Implants, including our ongoing PMA clinical trial, to demonstrate our products’ value in improving safety outcomes and/or patient satisfaction;


▪	acceptance of Motiva Implants as safe and effective by patients, caregivers and the medical community;


▪	an acceptable safety profile of Motiva Implants in the global market;


▪	whether key thought leaders in the medical community accept that such clinical studies are sufficiently meaningful to influence their or their patients’ choices of product;


▪	maintenance of our existing regulatory approvals and expansion of the geographies in which we have regulatory approvals;


▪	commercially viable processes at a scale sufficient to meet anticipated demand at an adequate cost of manufacturing, and that are compliant with ISO 13485 Quality Management System requirements and/or good manufacturing practice, or GMP, requirements, as set forth in the FDA’s Quality System Regulation, Brazilian and other international regulations;


▪	our success in educating physicians and patients about the benefits, administration and use of Motiva Implants, Motiva branded surgeries and value proposition of our MotivaImagine Centers;


▪	the successful implementation of our MotivaImagine Centers with plastic surgery clinics;


▪	the availability, perceived advantages, relative cost, relative safety and relative efficacy of alternative and competing treatments;


▪	the willingness of patients to pay out-of-pocket for breast augmentation procedures in the absence of coverage and reimbursement for such procedures;


▪	the success of our internal sales and marketing organization and the sales forces of our distributors; and


▪	continued demand for breast augmentation and reconstruction procedures using silicone implants, which may be adversely affected by events involving either our products or those of our competitors, including FDA warnings to patients regarding Breast Implant-Associated Anaplasic Large Cell Lymphoma, or BIA-ALCL.

Some of these factors are beyond our control. If we are unable to continue to commercialize Motiva Implants and our other products, or unable to obtain a partner to commercialize them, we may not be able to produce any incremental revenues related to Motiva Implants and our other products. This would result in an adverse effect on our business, financial condition, results of operations and growth prospects.

We have a limited operating history and may face difficulties encountered by companies early in their commercialization in competitive and rapidly evolving markets.

Our Motiva Implants have been marketed in countries outside of the United States since October 2010, and as such, we have a limited operating history upon which to evaluate our business and forecast our future net sales and operating

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results. In assessing our business prospects, you should consider the various risks and difficulties frequently encountered by companies early in their commercialization in competitive markets, particularly companies that develop and sell medical devices. These risks include our ability to:


▪	implement and execute our business strategy;


▪	expand and improve the productivity of our direct sales force, distributors and marketing programs to grow sales of our existing and proposed products;


▪	increase awareness of our brands and build loyalty among plastic surgeons and patients;


▪	manage expanding operations;


▪	respond effectively to competitive pressures and developments;


▪	enhance our existing products and develop new products;


▪	obtain regulatory clearance or approval to enhance our existing products and commercialize new products;


▪	respond to changing regulations associated with medical devices across all geographies;


▪	perform clinical trials with respect to our existing products and any new products;


▪	attract, retain and motivate qualified personnel in various areas of our business; and


▪	obtain and maintain coverage and adequate levels of reimbursement for our products.

Due to our limited operating history, we may not have the institutional knowledge or experience to be able to effectively address these and other risks that we may face. In addition, we may not be able to develop insights into trends that could emerge and negatively affect our business and may fail to respond effectively to those trends. As a result of these or other risks, we may not be able to execute key components of our business strategy, and our business, financial condition and operating results may suffer.

Our business depends on maintaining our brand and ongoing customer demand for our products and services, and a significant reduction in sentiment or demand could affect our results of operations.

Our success depends on the reputation of our brands, which depends on factors such as the safety and quality of our products, our communication activities, including marketing and education efforts, and our management of our customer experience. Maintaining, promoting and positioning our brands is important to expanding our customer base. This will depend largely on the success of our education and marketing efforts and our ability to provide a consistent, high-quality customer experience.

We may need to make substantial investments in the areas of education and marketing in order to maintain and enhance our brands. Ineffective marketing, negative publicity, significant discounts by our competitors, product defects and related liability litigation, failure to obtain regulatory clearance for our products, counterfeit products, unfair labor practices and failure to protect the intellectual property rights in our brands are some of the potential threats to the strength of our business. To protect our brands’ status, we may need to make substantial expenditures to mitigate the impact of such threats.

We believe that maintaining and enhancing our brands in the countries in which we currently sell our products and in new countries where we have limited brands recognition is important to expanding our customer base. If we are unable to maintain or enhance the strength of our brands in the countries in which we currently sell our products and in new countries, then our growth strategy could be adversely affected.

Our success depends, in part, on our ability to continue to enhance our existing products and services and develop or commercialize new products and services that respond to customer needs and preferences, which we expect will require us to incur significant expenses.

In recent years, we have incurred significant costs in connection with the development of Motiva Implants, the MotivaImagine platform, including the Divina 3D simulation system, and other products and services. We expect our research and development expenses to increase significantly in 2018 and beyond, as we initiate our IDE clinical trial in the United States. We will also incur significant expenses to expand our sales and marketing organization to support sales of Motiva Implants, including but not limited to a direct sales force in Brazil, France, Sweden, Denmark, Norway and the United Kingdom, as well as Puregraft and MotivaImagine products outside the United States and Canada. We intend to utilize a portion of the net proceeds from this offering in order to cover these additional expenses.

We may not be able to compete effectively with our competitors, and ultimately satisfy the needs and preferences of our customers, unless we can continue to enhance existing products and develop or acquire new innovative products and services. Product development requires the investment of significant financial, technological and other resources.

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Product improvements and new product introductions also require significant planning, design, development and testing at the product and manufacturing process levels. We may not be able to timely or effectively develop product improvements or new products and services. Likewise, we may not be able to acquire new products on terms that are acceptable to us, or at all. Furthermore, in most countries, we need to obtain regulatory approval in order to market and sell our products, which may limit our ability to act quickly in scaling commercialization in those countries, including the United States. Our competitors’ new products may beat our products to market, be more effective or safer or have new features, obtain better market acceptance or render our products and services obsolete. Any new or modified products and services that we develop may not receive regulatory clearance or approval, or achieve market acceptance or otherwise generate any meaningful sales or profits for us.

Pricing pressure from customers and our competitors may impact our ability to sell our products at prices necessary to support our current business strategies and future expansion.

The industry environment for silicone implants and complementary products in certain international markets is price-sensitive. In these markets, or in the United States if we are successful in obtaining the required regulatory approval to sell in the U.S. market, our competitors may adopt aggressive pricing strategies to intensify the competitive pricing pressure for breast implants. If we are not successful in educating customers or third-party payors of the differentiation of our Motiva Implants as compared to our competitors ’ products, customers may choose our competitors ’ products. Additionally, as more competitors introduce products that compete with ours, we may face additional pricing pressure that would adversely impact our future results.

A substantial proportion of our sales are through exclusive distributors, and we do not have direct control over the efforts these distributors may use to sell our products. If our relationships with these third-party distributors deteriorate, or if these third-party distributors fail to sell our products or engage in activities that harm our reputation, or fail to adhere to medical device regulations, our financial results may be negatively affected.

Historically, our sales model has been to sell primarily through distributors rather than through our own sales force, with the notable exception of Brazil, France, Sweden, Denmark, Norway, and the United Kingdom where we are selling directly, but, in the future, may utilize a hybrid sales model that includes both distributors and a direct sales effort. We believe that our reliance on distributors improves the economics of our business, as we do not carry the high fixed costs of a direct sales force in many of the countries in which our Motiva Implants are sold. If we are unable to maintain or enter into such distribution arrangements on acceptable terms, or at all, we may not be able to successfully commercialize our products in certain countries. Furthermore, distributors can choose the level of effort that they apply to selling our products relative to others in their portfolio. The selection, training, and compensation of a distributors’ sales personnel are within their control rather than our own and may vary significantly in quality from distributor to distributor.

In addition, although our contract terms require our distributors to comply with all applicable laws regarding the sale of our products, including anti-competition, anti-money laundering, sanctions laws and FDA regulations, we may not be able to ensure proper compliance. If our distributors fail to effectively market and sell our products in full compliance with applicable laws, our results of operations and business may suffer.

In certain large markets, we engage in direct sales efforts. We may fail to maintain and develop our direct sales force, and our revenues and financial outcomes could suffer as a result. Furthermore, our direct sales personnel may not effectively sell our products.

We have established a direct sales force for our business in Brazil, and we have implemented a direct sales strategy in France, Sweden, Denmark, Norway and the United Kingdom. We have hired and will need to retain and motivate a significant number of sales and marketing personnel in order to support our anticipated growth in these countries. There is significant competition for quality personnel experienced in such activities, including from companies with greater financial resources than ours. If we are not successful in our efforts to continue recruiting, retaining, and motivating such personnel, we may not be able to increase our revenues, or we may increase our expenses in greater measure than our revenues, negatively impacting our operating results.

We are also working on creating a direct sales structure and strategy in certain markets. We are working to put in place the correct legal and business structure to comply with taxation and operational requirements. These structures may not ultimately be implemented or, if implemented, be successful or effective and may not be able to increase our revenues or improve our gross margins. In addition, our expenses or tax related costs may increase in greater measure than our revenues, negatively impacting our operating results.

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Furthermore, our sales force may operate independently with limited day-to-day oversight from management. They may engage in sales practices that increase certain risks to our business, including the risk of scrutiny from regulatory authorities and the risk that we violate anti-corruption regulations in one or more countries. These and other independent actions may result in unexpected costs, news that might impair our reputation or revenues, litigation in various jurisdictions, and/or sanctions. Any of these could impair the trading price of our shares and adversely impact our results .

If we are unable to train plastic surgeons on the safe and appropriate use of our products and branded surgeries, we may be unable to achieve our expected growth.

An important part of our sales process includes educating plastic surgeons about the benefits and advantages of our Motiva Implants and MotivaImagine products, and training them on the safe and appropriate use of our products. As part of our effort to educate and train plastic surgeons through our MotivaEdge educational platform, we completed 50 medical training sessions worldwide during 2017, and plan to complete approximately 70 medical training sessions worldwide during 2018. If we are unable to train potential new plastic surgeon customers at these medical training sessions, we may be unable to achieve our expected growth.

It is critical to the success of our commercialization efforts to train a sufficient number of plastic surgeons and provide them with adequate instruction in the appropriate use of our products and branded surgeries. This training process may take longer than expected and may therefore affect our ability to grow our business. Following completion of training, we rely on the trained plastic surgeons to advocate for our products and branded surgeries in the marketplace. Convincing plastic surgeons to dedicate the time and focus necessary for adequate training is challenging, and we cannot provide any assurances we will be successful in these efforts. If plastic surgeons are not properly trained, they may misuse or ineffectively use our products or branded surgeries. This may also result in, among other things, unsatisfactory patient outcomes, patient injury, negative publicity or lawsuits against us, any of which could have an adverse effect on our business and reputation.

In addition, we need to ensure that plastic surgeons are sufficiently educated our regarding our implants. For example, many metal implants, such as screws or artificial joints, produce an artifact when magnetic resonance imaging, or MRI, is used to image the area in which the object resides. Our QInside Safety Technology microtransponder embedded in certain Motiva Implants contains metal and causes an artifact that can affect breast cancer screening using MRI, and this artifact is not present in other imaging modalities such as breast ultrasound and film or digital mammography. It is important that we educate physicians and patients of the risks associated with MRI artifacts and how to mitigate them if they choose to utilize Motiva Implants that contain a QInside microtransponder. If we fail to educate physicians and patients about any of these factors, they may make decisions regarding Motiva Implants without full knowledge of the risks and benefits or may view our Motiva Implants negatively.

There is no guarantee that the FDA or non-U.S. regulatory agencies will grant approval for our current or future products, and failure to obtain regulatory approvals in the United States and other international jurisdictions, or revocation of approvals in those jurisdictions, will prevent us from marketing our products.

We intend to seek additional distribution and marketing partners for Motiva Implants and may market specific products only in international markets. We have obtained a CE Mark for Motiva Implants and are therefore authorized to sell in the EU; however, in order to market in regions such as the Asia Pacific region and many other jurisdictions, we must obtain separate regulatory approvals. The approval procedures vary among countries and can involve additional clinical testing, and the time required to obtain approval may differ from that required to obtain the CE Mark or FDA approval. Moreover, clinical studies or manufacturing processes conducted in one country may not be accepted by regulatory authorities in other countries. Approval by the FDA does not ensure approval by regulatory authorities in other countries, and approval by one or more international regulatory authorities does not ensure approval by regulatory authorities in other countries or by the FDA. However, a failure or delay in obtaining regulatory approval in one country may have a negative effect on the regulatory process in others. An international regulatory approval process may include all of the risks associated with obtaining FDA approval. We may not obtain international regulatory approvals on a timely basis, if at all. We may not be able to file for regulatory approvals and even if we file we may not receive necessary approvals to commercialize our products in any market.

Before obtaining regulatory approval for the sale of a planned product, we may be required to conduct extensive preclinical and clinical studies to demonstrate the safety and efficacy of our planned products in human patients. Clinical studies can be expensive, difficult to design and implement, can take many years to complete, and are uncertain as to outcome. A failure of one or more of our clinical studies could occur at any stage of testing. In connection with the initiation of a clinical study in the United States, we filed an IDE application in 2017, which was approved in March 2018. Our first patient was enrolled in April 2018, and we anticipate completing enrollment in early 2019. Our ongoing U.S. IDE trial may take longer to enroll than anticipated, may be stopped for unforeseen safety issues or may not be

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successful in meeting its endpoints, in which case our U.S. regulatory pathway would require subsequent additional clinical trials.

Numerous unforeseen events during, or as a result of, preclinical and clinical studies could occur, which would delay or prevent our ability to receive regulatory approval or commercialize Motiva Implants or any of our planned products, including the following:


▪	clinical studies may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical studies or abandon product development programs;


▪	the number of patients required for clinical studies may be larger than we anticipate, enrollment in these clinical studies may be insufficient or slower than we anticipate, or patients may drop out of these clinical studies at a higher rate than we anticipate;


▪	the cost of clinical studies may be greater than we anticipate;


▪	third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all;


▪	we might suspend or terminate clinical studies of our planned products for various reasons, including a finding that our planned products have unanticipated serious side effects or other unexpected characteristics, or that the study subjects are being exposed to unacceptable health risks;


▪	regulators may not approve our proposed clinical development plans;


▪	Regulators or independent institutional review boards, or IRBs, may not authorize us or our investigators to commence a clinical study or conduct a clinical study at a prospective study site;


▪	regulators or IRBs may require that we, or our investigators, suspend or terminate clinical studies for various reasons, including noncompliance with regulatory requirements;


▪	regulators in countries where Motiva Implants are currently marketed may require that we suspend commercial distribution if there is noncompliance with regulatory requirements or safety concerns;


▪	regulators in countries where Motiva Implants are currently marketed may suspend commercial distribution of silicone breast implants due to safety or other concerns generally applicable to the product category;


▪	the supply or quality of our planned products or other materials necessary to conduct clinical studies of our planned products may be insufficient or inadequate; and/or


▪	the enactment of new regulatory requirements in Europe under the new Medical Device Regulation may make approval times longer and standards more difficult to pass .

If we or any future collaboration partner are required to conduct additional clinical trials or other testing of Motiva Implants or any planned products beyond those that we contemplate, those clinical studies or other testing may not be successfully completed, if the results of these studies or tests are not positive or are only modestly positive or if they raise safety concerns, we may:


▪	be delayed in obtaining marketing approvals for Motiva Implants or our planned products;


▪	not obtain marketing approval at all;


▪	obtain approval for indications that are not as broad as intended;


▪	have a product removed from the market after obtaining marketing approval;


▪	be subject to additional post-marketing testing requirements; and/or


▪	be subject to restrictions on how the product is distributed or used.

Even if we obtain regulatory approvals or clearances in a jurisdiction, our products may be removed from the market due to a variety of factors, including adverse events, recalls, suspension of regulatory clearance to sell, or other factors. For example, during the summer of 2016 while we were transitioning from one notified body to another, our CE Mark for Motiva Implants was temporarily not in force. We expect that the initial U.S. approval will be subject to a lengthy and expensive follow-up period, during which we must monitor patients enrolled in clinical studies and collect data on their safety outcomes. Even if FDA approval is obtained, FDA has authority to impose postmarket approval conditions, which can include (i) restrictions on device’s sale, distribution, or use, (ii) continuing evaluation of the device’s safety and efficacy, (iii) additional warning/hazard labeling requirements, (iv) significant record management, (v) periodic reporting requirements, and (vi) any other requirements the FDA determines necessary to provide reasonable assurance of the device’s safety and effectiveness. Completion of this follow-up study, in a manner which results in data sufficient to maintain FDA approval, is subject to multiple risks, many of which are outside of our control. These include, but are not limited to, our ability to fund the ongoing study from our operations or via additional fundraising; study participants’ willingness and ability to return for follow-up study visits; and maintenance of a suitable study database over a long period of time. Even if completed and appropriately evaluated, the study follow-up may reveal safety or other issues that

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impact the approved labeling, or may result in withdrawal of Motiva Implants from the marketplace in the United States or elsewhere.

Although we launched Motiva Implants commercially in October 2010 and have sold over 446,000 units to date in various countries outside the United States, we do not have as much post-market surveillance data as our competitors and may not have clearly identified all possible or actual risks of our products. Furthermore, if our clinical trials do not produce patient data that compares favorably with breast implants that are already on the market, physicians and patients may opt not to use our products, and our business would suffer.

Our product development costs will also increase if we experience delays to our clinical trials or approvals. We do not know whether any clinical studies will begin as planned, will need to be restructured, or will be completed on schedule, or at all.

Significant clinical study delays could allow our competitors to bring products to market before we do, which would impair our ability to commercialize our planned products and harm our business and results of operations.

Motiva Implants are not currently approved for commercial sale in the United States. Obtaining such approval is costly and time consuming, and we may not obtain the regulatory approval required to sell our products in the United States.

Neither we, nor any future collaboration partner, can commercialize Motiva Implants in the United States without first obtaining regulatory approval for the product from the FDA. In the EU and other countries, we previously obtained a CE Mark, before making Motiva Implants available for commercial sale. FDA guidance on silicone breast implants mandates approval via the PMA process. Extensive preclinical and clinical testing will be required to support the PMA. At least one well-controlled clinical trial is required for approval, such as the one we began in April 2018, which will require us to commit significant financial and personnel resources. Additionally, we will be required to commit to significant and costly post-approval requirements, which will include follow-up of our clinical trial patients for up to ten years, creation of a patient registry, and/or other studies, and implementation of training programs for physicians. We may be unable to fund, enroll, or complete such trials in a timely fashion, or at all, and we may have an insufficient number of enrolled patients follow up as instructed. The results of clinical studies may not be favorable enough to support marketing approval in the United States , or may raise other questions (pertaining, for example, to product safety or effectiveness) that jeopardizes our current approvals for sale in other territories. The FDA approval process will take at least several years to complete, and FDA approval may never be obtained. We must also demonstrate that our manufacturing facilities, processes and controls are adequate to support FDA approval and that our clinical investigators complied with good clinical practices in the conduct of our Motiva Implant clinical trial.

Furthermore, FDA regulatory approval is not a guarantee, and the filing and approval process itself is expensive and may take several years. The FDA also has substantial discretion in the approval process. Despite the time and expense exerted, failure may occur at any stage, and we could encounter problems that cause us to abandon or repeat clinical studies , including our ongoing PMA clinical trial that commenced in April 2018. The FDA can delay, limit, or deny approval of a product candidate for many reasons, including, but not limited, to:


▪	a product candidate may not be deemed to be safe and effective;


▪	FDA officials may not find the data from clinical and preclinical studies sufficient;


▪	the FDA may not approve our or our suppliers’ processes or facilities; or


▪	the FDA may change its approval policies or adopt new regulations.

If Motiva Implants, or our future products, fail to demonstrate safety and efficacy in further clinical studies that may be required for U.S. approval, or do not gain regulatory approval, our business and results of operations will be harmed.

Moreover, obtaining regulatory approval for marketing of our products in one country does not ensure we will be able to obtain regulatory approval in other countries, while a failure or delay in obtaining regulatory approval in one country may have a negative effect on the regulatory process in other countries.

Even if clinical trials demonstrate acceptable safety and efficacy for Motiva Implants in some patient populations, the FDA or similar regulatory authorities outside the United States may not approve the marketing of Motiva Implants or may approve it with restrictions on the label, which could have a material adverse effect on our business, financial condition, results of operations and growth prospects.

It is possible the FDA or similar regulatory authorities may not consider the results of our clinical trials to be sufficient for approval of Motiva Implants for our desired indications for use. Guidance issued by the FDA in 2006 suggests that a

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single well-controlled study is required for approval of a new silicone breast implant. The FDA may nonetheless require that we conduct additional clinical studies, possibly using a different clinical study design.

Moreover, even if the FDA or other regulatory authorities approve the marketing of Motiva Implants, the approval may include additional restrictions on the label that could make Motiva Implants less attractive to physicians and patients compared to other products that may be approved for broader indications, which could limit potential sales of Motiva Implants.

If we fail to obtain FDA or other regulatory approval of Motiva Implants, or if the approval is narrower than what we seek, it could impair our ability to realize value from Motiva Implants, and therefore may have a material adverse effect on our business, financial condition, results of operations and growth prospects.

Manufacturing of silicone breast implants requires costly capital equipment and a highly-skilled workforce. There is a significant lead time to build and certify a new manufacturing facility. Until 2017, we had one manufacturing facility in Costa Rica, and we experienced inventory shortages from time-to-time that impaired our ability to meet market demand. In March 2017, our second manufacturing facility, also located in Costa Rica, became operational, and we received certification under the multi-country MDSAP protocol and began shipping saleable product . Although we believe our new, larger manufacturing facility, in combination in our first facility, will give us adequate manufacturing capacity to meet demand for at least the next two years, we have, in the past, been unable to fill all incoming orders to meet growing demand. In addition, if we obtain FDA approval, we will likely need to obtain additional manufacturing capacity prior to any commercialization of our Motiva Implants in the United States. If demand increases faster than we expect, or if we are unable to produce the quantity of goods that we expect with our current facilities, we may not be able to grow revenue at an optimal rate. There may be other negative effects from supply shortages, including loss of our reputation in the marketplace and a negative impact on our relationships with our distributors.

On the other hand, if demand for our products declines, or if market supply surpasses demand, we may not be able to reduce manufacturing expenses or overhead costs proportionately. We have invested significantly in our manufacturing capacity in order to vertically integrate our business. If an increase in supply outpaces the increase in market demand, or if demand decreases, the resulting oversupply could adversely impact our sales and result in the underutilization of our manufacturing capacity, higher inventory carrying costs and associated working capital, changes in revenue mix, and/or price erosion, any of which would lower our margins and adversely impact our financial results.

If we fail to compete effectively against our competitors, many of whom have greater resources than we have, our revenues and results of operations may be negatively affected.

Alternatives exist for Motiva Implants and for our other products, and we will likely face competition with respect to any planned products that we may seek to develop or commercialize in the future from major pharmaceutical companies, specialty pharmaceutical companies, medical device companies and biotechnology companies worldwide. There are several large pharmaceutical and biotechnology companies that currently market silicone breast implants. We also face competition from manufacturers of saline-filled breast implants, and we see emerging competition from non-implant breast augmentation techniques such as hyaluronic acid injection and novel fat grafting methodologies. Any of these may present competitive barriers to Motiva Implants.

Our leading competitors are large, multi-national companies with significant resources and capabilities. Three of these companies, Sientra, Inc., Mentor Worldwide LLC (a division of Johnson & Johnson), and Allergan plc, have conducted large prospective clinical studies that started in the United States in 2002, 2000 and 1998, respectively, the data from which they use extensively to promote their products. While we plan to use a portion of the net proceeds from the current offering to conduct such a study, to date we have not conducted a study designed in such a way as to support a PMA application in the United States. This can put us at a disadvantage when promoting our products to physicians and patients, even outside the United States. In addition, the significant financial and staff resources and brand recognition that our competitors possess mean they may be able to compete with us regardless of the differentiating features of our products. If we are not successful in capturing market share, even outside the United States, or if physicians or patients do not perceive our products to be safer or more favorable, our revenues and/or our operating margins may be significantly impaired.

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In addition, manufacturers of competitive products may reduce prices for their competing products in an effort to gain or retain market share, and undermine the value proposition that Motiva Implants might otherwise be able to offer to customers. Potential competitors also include academic institutions, government agencies and other public and private research organizations that conduct research, seek patent protection and establish collaborative arrangements for research, development, manufacturing and commercialization. These competitors may develop new technologies that are superior to our products or replace silicone.

Smaller or early stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These third parties may compete with us in recruiting and retaining qualified technical and management personnel, establishing clinical study sites and patient registration for clinical studies, as well as in acquiring technologies complementary to, or necessary for, our programs.

We may be subject to substantial warranty or product liability claims or other litigation in the ordinary course of business that may adversely affect our business, financial condition and operating results.

We face an inherent risk of product liability exposure related to the sale of Motiva Implants and any planned products in clinical studies. The marketing, sale and use of Motiva Implants and our planned products could lead to the filing of product liability claims against us if someone alleges that our products failed to perform as designed or caused significant adverse events in patients. We may also be subject to liability for a misunderstanding of, or inappropriate reliance upon, the information we provide. If we cannot successfully defend ourselves against claims that Motiva Implants or our planned products caused injuries, we may incur substantial liabilities. Regardless of merit or eventual outcome, liability claims may result in:


▪	decreased demand for any planned products we may develop;


▪	injury to our reputation and significant negative media attention;


▪	withdrawal of patients from clinical studies or cancellation of studies;


▪	significant costs to defend the related litigation and distraction to our management team;


▪	substantial monetary awards to plaintiffs;


▪	loss of revenue; and


▪	the inability to commercialize any products that we may develop.

We currently hold $25 million in product liability insurance coverage, which may not be adequate to cover all liabilities we may incur. Insurance coverage is increasingly expensive. We may not be able to maintain insurance coverage at a reasonable cost or in an amount adequate to satisfy any liability that may arise.

Negative publicity, product defects and any resulting litigation concerning our products or our competitors’ products could harm our reputation and reduce demand for silicone breast impl ants, either of which could negatively impact our financial results.

The responses of potential patients, physicians, the news media, legislative and regulatory bodies and others to information about complications or alleged complications of our products, or products liability litigation against us or our competitors, could result in negative publicity and could materially reduce market acceptance of our products. These responses or any investigations and potential resulting negative publicity may have a material adverse effect on our business and reputation and negatively impact our financial condition, results of operations or the market price of our common shares. In addition, significant negative publicity could result in an increased number of product liability claims against us.

Counterfeit products may be represented as ours, which could compete with our genuine products and may also expose us to risks associated with adverse events and product liability.

With respect to our major competitors’ branded products, we routinely see counterfeit versions in the marketplace, which are packaged and represented as having been made by major companies. This is particularly common in emerging markets, where sensitivity to price is higher and regulatory enforcement is under-resourced. While we are not aware of any counterfeit Motiva Implants in the market, such products may appear as our market share and average selling price grow. These counterfeit products are typically manufactured with significantly lower quality than the products they are claimed to be, and in some cases may be manufactured with silicones that are not medical-grade. They may expose patients to significant adverse event risks, and there is a risk that certain adverse events with counterfeit products may be attributed to our genuine products. This could reduce demand for our products, result in negative publicity, or otherwise impact our business and the price of our shares.

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The loss of key members of our executive management team could adversely affect our business.

Our success in implementing our business strategy depends largely on the skills, experience and performance of key members of our executive management team and others in key management positions, including Juan José Chacón Quirós, our Chief Executive Officer, Salvador Dada, our Chief Operating Officer, and Roberto de Mezerville, our Chief Technology Officer. The collective efforts of each of these persons, and others working with them as a team, are critical as we continue to develop our tests and technologies and pursue our research and development and sales programs. As a result of the difficulty in locating qualified new management, the loss or incapacity of existing members of our executive management team could adversely affect our operations. If we were to lose one or more of these key employees, we could experience difficulties in finding qualified successors, competing effectively, developing our technologies and implementing our business strategy. We do not have “key person” life insurance on our senior executives, and the loss of any of the key members of our team would have a negative impact to our business and financial results.

In addition, we rely on collaborators, consultants and advisors, including scientific and clinical advisors, to assist us in formulating our research and development and commercialization strategy. Our collaborators, consultants and advisors are generally employed by employers other than us and may have commitments under agreements with other entities that may limit their availability to us.

The loss of a key employee, the failure of a key employee to perform in his or her current position or our inability to attract and retain skilled employees could result in our inability to continue to grow our business or to implement our business strategy.

Various factors outside our direct control may adversely affect manufacturing and supply of our breast implants, tissue expanders and other products.

We currently manufacture Motiva Implants at our facilities in the Coyol Free Zone, Alajuela, Costa Rica, under the multi-country MDSAP protocol . Our Divina scanners are manufactured from components sourced globally, with final assembly in Alajuela, Costa Rica. Our QInside Safety Technology microtransponders are manufactured by contract manufacturers with final testing and packaging at a manufacturing supplier facility in Regensburg, Germany; additional inspection of the units happens in our facilities in Coyol, Costa Rica, prior to approval for inclusion in Motiva Implants . We believe that we currently have adequate manufacturing capacity for all of our products sufficient to meet our demand forecasts for at least the next two years. If demand for our current products and our planned products increases more rapidly than we anticipate, or if we secure regulatory approval to commercialize our products in additional geographies , we will need to either expand our manufacturing capabilities or outsource to other manufacturers. We currently rely upon third-party contract manufacturing organizations to manufacture and supply components for our Divina scanners and QInside Safety Technology microtransponders. The manufacture of these products in compliance with ISO standards and the FDA’s regulations requires significant expertise and capital investment, including the development of advanced manufacturing techniques and process controls. Manufacturers of medical device products often encounter difficulties in production, including difficulties with production costs and yields, quality control, quality assurance testing, shortages of qualified personnel, as well as compliance with strictly enforced FDA requirements, other federal and state regulatory requirements, and foreign regulations.

We currently purchase components for the Divina scanners and QInside Safety Technology microtransponders under purchase orders and do not have long-term contracts with most of the suppliers of these materials. In addition, we rely on NuSil Technology, LLC, or NuSil, as the sole supplier of medical-grade silicone used in our Motiva Implants as well as other products that we manufacture under contract to other customers. See “-We rely on a single-source, third-party supplier for medical-grade silicone, which is the primary raw material used in these products. If this supplier were to increase prices for these raw materials over time or experience interruptions in their ability to supply us with this raw material, our business, financial condition and results of operations could be adversely affected.” If suppliers were to delay or stop producing our components, or if the prices they charge us were to increase significantly, or if they elected not to sell to us, we would need to identify other suppliers. We could experience delays in manufacturing our products while finding another acceptable supplier, which could impact our results of operations. The changes could also result in increased costs associated with qualifying the new materials and in increased operating costs. Further, any prolonged disruption in a supplier’s operations could have a significant negative impact on our ability to manufacture and deliver products in a timely manner.

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The manufacturing, sterilization and distribution of our Motiva Implants and other products are technically challenging. Changes that our suppliers may make, or additional requirements from regulatory agencies, outside of our direct control can have an impact on our processes, on quality and on the successful delivery of products to our customers. Mistakes and mishandling are not uncommon and can affect supply and delivery. Some of these risks include:


▪	failure to complete sterilization on time or in compliance with the required regulatory standards;


▪	transportation and import and export risk, particularly given the global nature of our supply and distribution chains;


▪	delays in analytical results or failure of analytical techniques that we depend on for quality control and release of products;


▪	natural or other disasters, labor disputes, financial distress, lack of raw material supply, issues with facilities and equipment or other forms of disruption to business operations affecting our manufacturer or its suppliers;


▪	latent defects that may become apparent after products have been released and that may result in a recall of such products;


▪	contamination of our raw materials or manufactured products; and


▪	inclusion of vendors of raw materials not in compliance with ISO-13485 requirements.

Some of the components used in our Motiva Implants are currently sole-sourced, and substitutes for these components might not be obtained easily or may require substantial design or manufacturing modifications. Any significant problem experienced by one of our sole source suppliers may result in a delay or interruption in the supply of components to us because the number of third-party manufacturers with the necessary manufacturing and regulatory expertise and facilities is limited and certification of a new supplier may be complex and time consuming. Any delay or interruption would likely lead to a delay or interruption in our manufacturing operations. The inclusion of substitute components must meet our product specifications and could require us to qualify the new supplier with the appropriate regulatory authorities. The added time and cost to arrange for alternative suppliers could have a material adverse effect on our business. New manufacturers of any planned product would be required to qualify under applicable regulatory requirements and would need to have sufficient rights under applicable intellectual property laws to the method of manufacturing the planned product. Obtaining the necessary FDA or international approvals or other qualifications under applicable regulatory requirements and ensuring non-infringement of third-party intellectual property rights could result in a significant interruption of supply and could require the new manufacturer to bear significant additional costs that may be passed on to us.

Any disruption at our existing facilities could adversely affect our business and operating results.

Our headquarters are located in Costa Rica, and all of our main manufacturing activities are conducted in two ISO-13485 and GMP compliant manufacturing facilities in Costa Rica through Establishment Labs, S.A. Despite our efforts to maintain and safeguard our manufacturing facilities, including acquiring insurance and adopting maintenance and health and safety protocols, vandalism, terrorism or a natural or other disaster, such as earthquake, volcanic activity, fire or flood, could damage or destroy our inventory of finished goods, cause substantial delays in our operations and manufacturing, result in the loss of key information and cause us to incur additional expenses. Our insurance may not cover our losses in any particular case. In addition, regardless of the level of insurance coverage, damage to our facilities may have an adverse effect on our business, financial condition and results of operations.

We have made multiple acquisitions in the past, and in the future we may acquire other businesses or form joint ventures or make investments in other companies or technologies. If we are not successful in integrating these businesses, as well as identifying and controlling risks associated with the past operations of these businesses, we may incur significant costs, receive penalties or other sanctions from various regulatory agencies, and/or incur significant diversions of management time and attention.

We believe our business growth will be enhanced if we continually seek opportunities to enhance and broaden our product offerings. As part of our business strategy, we may pursue acquisitions or licenses of assets, or acquisitions of businesses. We also may pursue strategic alliances and joint ventures that leverage our core technology and industry experience to expand our product offerings or sales and distribution resources. We have acquired companies in a variety of countries, including Belgium, Brazil, Sweden, Denmark, Norway and France. We have also acquired and licensed assets.

We may do more of these types of transactions in the future and may also form strategic alliances and joint ventures. We may not be able to find suitable partners or acquisition candidates, and we may not be able to complete such transactions on favorable terms, if at all. If we make any acquisitions, we may not be able to integrate these acquisitions successfully into our existing business, and we could assume unknown or contingent liabilities. Any future acquisitions

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also could result in significant write-offs or the incurrence of debt and contingent liabilities, any of which could have an adverse effect on our financial condition, results of operations and cash flows. Integration of an acquired company may also disrupt ongoing operations and require management resources that would otherwise focus on developing our existing business. We may experience losses related to investments in other companies, which could have a negative effect on our results of operations. We may not identify or complete these transactions in a timely manner, on a cost-effective basis, or at all, and we may not realize the anticipated benefits of any acquisition, license, strategic alliance or joint venture. To finance such a transaction, we may choose to issue common shares as consideration, which would dilute the ownership of our shareholders. If the price of our common shares is low or volatile, we may not be able to acquire other companies or fund a joint venture project using our shares as consideration. Alternatively, it may be necessary for us to raise additional funds for acquisitions through public or private financings. Additional funds may not be available on terms that are favorable to us, or at all.

We do not know whether we will be able to successfully integrate any acquired business, product or technology. The success of any given acquisition may depend on our ability to retain any key employees related thereto, and we may not be successful at retaining or integrating such key personnel. Integrating any business, product or technology we acquire could be expensive and time-consuming, disrupt our ongoing business, impact our liquidity, and/or distract our management. If we are unable to integrate any acquired businesses, products or technologies effectively, our business may suffer. Whether as a result of unsuccessful integration, unanticipated costs, including those associated with assumed liabilities and indemnification obligations, negative accounting impact, or other factors, we may not realize the economic benefits we anticipate from acquisitions. In addition, any amortization or charges resulting from the costs of acquisitions could increase our expenses.

If changes in the economy and/or consumer spending, consumer preference and other trends reduce consumer demand for our products, our sales and profitability would suffer.

We are subject to the risks arising from adverse changes in general economic and market conditions. Certain elective procedures, including breast augmentation, are typically not covered by insurance. Adverse changes in the economy may cause consumers to reassess their spending choices, which could have an adverse effect on consumer spending, reduce the demand for these surgeries, and therefore have an adverse effect on our revenues. Furthermore, consumer preferences and trends may shift due to a variety of factors, including changes in demographic and social trends, public health initiatives and product innovations, which may reduce consumer demand for our products.

Fluctuations in insurance costs and availability, and future insurance requirements could adversely affect our profitability or our risk management profile.

We hold a number of insurance policies, including product liability insurance, directors’ and officers’ liability insurance, general liability insurance, property insurance and workers’ compensation insurance. If the costs of maintaining adequate insurance coverage increase significantly in the future, our operating results could be adversely affected. Likewise, if any of our current insurance coverage should become unavailable to us or become economically impractical, we would be required to operate our business without indemnity from commercial insurance providers. If we operate our business without insurance, we could be responsible for paying claims or judgments against us that would have otherwise been covered by insurance, which would adversely affect our results of operations or financial condition.

Continued international expansion of our business will expose us to business, regulatory, political, operational, financial and economic risks associated with doing business internationally.

Our products are currently sold in over 60 countries, and we operate subsidiaries in the United States , Costa Rica, Brazil, Belgium, France, Sweden and Switzerland. Our business strategy contemplates continued international expansion, including partnering with medical device distributors, and introducing Motiva Implants and other planned products outside the United States . The sale and shipment of our products internationally, as well as the purchase of components from international sources, subjects us to potential trade, import and export, and customs regulations and laws.

Compliance with these regulations and laws is costly and exposes us to penalties for non-compliance. Any failure to comply with applicable legal and regulatory obligations could impact us in a variety of ways that include, but are not limited to, significant criminal, civil and administrative penalties, including imprisonment of individuals, fines and penalties, denial of export or import privileges, seizure of shipments, restrictions on certain business activities and exclusion or debarment from government contracting. Also, the failure to comply with applicable legal and regulatory obligations could result in the disruption of our shipping and sales activities.

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In addition, several of the countries in which we sell our products or conduct our operations are, to some degree, subject to political, economic or social instability. Doing business in Costa Rica and other countries outside the United States involves a number of other risks, including:


▪	compliance with the free zone regime regulations under which the manufacturing sites operate;


▪	different regulatory requirements for device approvals in international markets;


▪	multiple, conflicting and changing laws and regulations such as tariffs and tax laws, export and import restrictions, employment laws, regulatory requirements and other governmental approvals, permits and licenses;


▪	potential failure by us or our distributors to obtain and/or maintain regulatory approvals for the sale or use of our products in various countries;


▪	difficulties in managing global operations;


▪	logistics and regulations associated with shipping products, including infrastructure conditions and transportation delays;


▪	limits on our ability to penetrate international markets if our distributors do not execute successfully;


▪	governmental price controls, differing reimbursement regimes and other market regulations;


▪	financial risks, such as longer payment cycles, difficulty enforcing contracts and collecting accounts receivable, and exposure to currency exchange rate fluctuations;


▪	reduced protection for intellectual property rights, or lack of them in certain jurisdictions, forcing more reliance on our trade secrets, if available;


▪	economic weakness, political and economic instability, including wars, terrorism and political unrest, outbreak of disease, boycotts, curtailment of trade and other business restrictions;


▪	the March 2017 Article 50 notice of withdrawal that formally began the process of a British exit from the EU, including with respect to its effect on the value of the British pound relative to other currencies;


▪	failure to comply with the Foreign Corrupt Practices Act, including its books and records provisions and its anti-bribery provisions, by maintaining accurate information and control over sales activities and distributors’ activities;


▪	unexpected changes in tariffs, trade barriers and regulatory requirements;


▪	compliance with tax, employment, immigration and labor laws;


▪	taxes, including withholding of payroll taxes;


▪	currency fluctuations, which could result in increased operating expenses and reduced revenue, and other obligations incident to doing business in another country;


▪	workforce uncertainty in countries where labor unrest is more common than in the United States;


▪	production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and


▪	business and shipping interruptions resulting from natural or other disasters including earthquakes, volcanic activity, hurricanes, floods and fires.

Any of these risks, if encountered, could harm our future international expansion and operations and, consequently, have an adverse effect on our financial condition, results of operations and cash flows.

Our failure to adequately protect personal information in compliance with evolving legal requirements could harm our business.

In the ordinary course of our business, we collect and store sensitive data, including legally protected patient health information, credit card information and personally identifiable information. W e collect this kind of information on our customers for purposes of servicing potential warranty claims and for post-marketing safety vigilance. These data protection and privacy-related laws and regulations are evolving and may result in ever-increasing regulatory and public scrutiny and escalating levels of enforcement and sanctions.

There are a number of state, federal and international laws protecting the privacy and security of health information and personal data. As part of the American Recovery and Reinvestment Act 2009, or ARRA, Congress amended the privacy and security provisions of the Health Insurance Portability and Accountability Act, or HIPAA. HIPAA imposes limitations on the use and disclosure of an individual’s protected health information by certain health care providers, health care clearinghouses, and health insurance plans, collectively referred to as covered entities, that involve the creation, use, maintenance or disclosure of protected health information . The HIPAA amendments also impose compliance obligations and corresponding penalties for non-compliance on individuals and entities that provide services to health care providers and other covered entities, collectively referred to as business associates. ARRA also made significant increases in the penalties for improper use or disclosure of an individual’s protected health information under HIPAA and extended

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enforcement authority to state attorneys general. The amendments also create notification requirements for individuals whose protected health information has been inappropriately accessed or disclosed, notification requirements to federal regulators and in some cases, notification to local and national media. Notification is not required under HIPAA if the health information that is improperly used or disclosed is deemed secured in accordance with encryption or other standards developed by the U.S. Department of Health and Human Services, or HHS. Most states have laws requiring notification of affected individuals and state regulators in the event of a breach of personal information, which is a broader class of information than the protected health information protected by HIPAA. Many state laws impose significant data security requirements, such as encryption or mandatory contractual terms to ensure ongoing protection of personal information.

In addition, even when HIPAA does not apply, according to the FTC, failing to take appropriate steps to keep consumers’ personal information secure constitutes unfair acts or practices in or affecting commerce in violation of Section 5(a) of the FTCA, 15 U.S.C § 45(a). The FTC expects a company’s data security measures to be reasonable and appropriate in light of the sensitivity and volume of consumer information it holds, the size and complexity of its business, and the cost of available tools to improve security and reduce vulnerabilities. Medical data is considered sensitive data that merits stronger safeguards. The FTC’s guidance for appropriately securing consumers’ personal information is similar to what is required by the HIPAA Security Rule.

Many foreign countries and governmental bodies, including the EU, Canada, Australia and other relevant jurisdictions, have laws and regulations concerning the collection and use of personal or sensitive data obtained from their residents or by businesses operating within their jurisdiction. For example, the European Commission recently adopted the General Data Protection Regulation, or the GDPR, effective on May 25, 2018, that will supersede current EU data protection legislation, impose more stringent EU data protection requirements and provide for greater penalties for noncompliance. The GDPR applies to any company established in the EU as well as to those outside the EU if they collect and use personal data in connection with the offering goods or services to individuals in the EU or the monitoring of their behavior. The GDPR enhances data protection obligations for processors and controllers of personal data, including, for example, expanded disclosures about how personal information is to be used, limitations on retention of information, mandatory data breach notification requirements and onerous new obligations on services providers. Non-compliance with the GDPR can trigger steep fines of up to €20 million or 4% of total worldwide annual revenues, whichever is higher. Given the breadth and depth of changes in data protection obligations, preparing to meet the GDPR’s requirements before its application on May 25, 2018 requires time, resources and a review of the technology and systems currently in use against the GDPR’s requirements.

We are at risk of enforcement actions taken by certain EU data protection authorities until such point in time that we may be able to ensure that all transfers of personal data to us from the European Economic Area are conducted in compliance with all applicable regulatory obligations, the guidance of data protection authorities and evolving best practices. We may find it necessary to establish systems to maintain personal data originating from the EU in the European Economic Area, which may involve substantial expense and may cause us to need to divert resources from other aspects of our business, all of which may adversely affect our business.

Our failure to comply with applicable laws and regulations, or to protect such data, could result in enforcement actions against us, including fines, imprisonment of company officials and public censure, claims for damages by end-customers and other affected individuals, damage to our reputation and loss of goodwill, any of which could harm on our operations, financial performance, and business. Evolving and changing definitions of personal data and personal information, within the European Union, the United States , and elsewhere, may limit or inhibit our ability to operate or expand our business, including limiting strategic partnerships that may involve the sharing of data. Moreover, if the relevant laws and regulations change, or are interpreted and applied in a manner that is inconsistent with our data practices or the operation of our products, we may need to expend resources in order to change our business operations, data practices, or the manner in which our products operate. Even the perception of privacy concerns, whether or not valid, may harm our reputation and inhibit adoption of our products.

If we are not able to satisfy data protection, security, privacy, and other government- and industry-specific requirements, our business could be harmed.

There are a number of data protection, security, privacy and other government- and industry-specific requirements, including those that require companies to notify individuals of data security incidents involving certain types of personal data. Security compromises experienced by other companies, by our customers or by us may lead to public disclosures, which could harm our reputation, erode customer confidence in the effectiveness of our security measures, negatively impact our other products and our ability to attract new customers. As we expand into new regions, we will need to comply with new requirements. If we cannot comply or if we incur a violation in one or more of these requirements, our growth could be adversely impacted, and we could incur significant liability.

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Risks Related to the Operation of Our Business

We expect to significantly increase the size of our organization; as a result, we may encounter difficulties in managing our growth, which could disrupt our operations and/or increase our net losses.

As of March 31, 2018, we had 397 em ployees. Over the next several years, we expect to experience significant growth in the number of our employees and the scope of our operations, particularly in the areas of manufacturing, regulatory affairs, clinical and sales and marketing. We also intend to continue to improve our operational, financial and management controls, reporting systems and procedures, which may require additional personnel. Such growth could place a strain on our administrative and operational infrastructure, and/or our managerial abilities, and we may not be able to make improvements to our management information and control systems in an efficient or timely manner. We may discover deficiencies in existing systems and controls.

Many of these employees will be in countries outside of our corporate headquarters, which adds additional complexity. To manage our anticipated future growth, we must continue to implement and improve our managerial, operational and financial systems, expand our facilities and continue to recruit and train additional qualified personnel. We may not be able to effectively manage these activities. The physical expansion of our operations may lead to significant costs and may divert our management and business development resources. Future growth would impose significant added responsibilities on members of management, including:


▪	managing our clinical trials effectively, which we anticipate being conducted at numerous clinical sites;


▪	identifying, recruiting, maintaining, motivating and integrating additional employees with the expertise and experience we will require, in multiple countries;


▪	managing our internal development efforts effectively while complying with our contractual obligations to licensors, licensees, contractors and other third parties;


▪	managing additional relationships with various distributors, suppliers, and other third parties;


▪	improving our managerial, development, operational and finance reporting systems and procedures; and


▪	expanding our facilities.

Our failure to accomplish any of these tasks could prevent us from growing successfully. Any inability to manage growth could delay the execution of our business plans or disrupt our operations. We may also be exposed or subject to additional unforeseen or undisclosed liabilities as well as increased levels of indebtedness.

Any future distribution or commercialization agreements we may enter into with respect to our current or planned products may place the development of these products outside our control, or may otherwise be on terms unfavorable to us.

We may enter into additional distribution or commercialization agreements with third parties with respect to our current or planned products, for commercialization in or outside the United States . Our likely collaborators for any distribution, marketing, licensing or other collaboration arrangements include large and mid-size medical device and diagnostic companies, regional and national medical device and diagnostic companies, and distribution or group purchasing organizations. We will have limited control over the amount and timing of resources that our collaborators dedicate to the development or commercialization of our planned products. Our ability to generate revenue from these arrangements will depend in part on our collaborators’ abilities to successfully perform the functions assigned to them in these arrangements.

Collaborations may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable planned products. Collaborators may own or co-own intellectual property covering our products that results from our collaboration with them. In such cases, we would not have the exclusive right to commercialize such intellectual property.

Any termination or disruption of collaborations could result in delays in the development of planned products, increases in our costs to develop the planned products or the termination of development of a planned product.

We rely on third parties to conduct certain components of our clinical studies, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such studies, which could interfere with or delay our ability to get regulatory approval or commercialize our products.

We rely on third parties, such as contract research organizations, or CROs, clinical data management organizations, medical institutions and clinical investigators, to perform various functions for our clinical trials. Our reliance on these third parties for clinical development activities reduces our control over these activities but does not relieve us of our responsibilities. We remain responsible for ensuring that each of our clinical studies is conducted in accordance with the

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general investigational plan and protocols for the study. Moreover, the International Council for Harmonization,or ICH, and the FDA require us to comply with standards, commonly referred to as good clinical practices, for conducting, recording and reporting the results of clinical studies to ensure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of patients in clinical studies are protected. Furthermore, these third parties may also have relationships with other entities, some of which may be our competitors. If these third parties do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical studies in accordance with regulatory requirements or our stated protocols, we will not be able to obtain, or may be delayed in obtaining, regulatory approvals for our planned products and will not be able to, or may be delayed in our efforts to, successfully commercialize our planned products.

Our results of operations could be affected by fluctuations in currency rates.

We present our results of operations in U.S. dollars, which is our reporting currency. However, as of December 31, 2017 , the majority of our revenues are denominated in currencies other than the U.S. dollar - primarily the British pound, the euro, and the Brazilian real. As of December 31, 2017 , the majority of our expenses are denominated in U.S. dollars or in Costa Rican colons, which are linked to the U.S. dollar. In the future, we expect to have significant revenues and expenses denominated in these non-U.S. currencies. As such, unfavorable fluctuations in currency exchange rates could have an adverse effect on our results of operations.

Because our combined consolidated financial statements are presented in U.S. dollars, we must translate revenues, expenses and income, as well as assets and liabilities, into U.S. dollars at exchange rates in effect during or at the end of each reporting period. Therefore, changes in the value of the U.S. dollar in relation to the British pound, the euro, and the Brazilian real will affect our revenues, operating income and the value of balance sheet items originally denominated in other currencies. These changes would cause our growth in consolidated earnings stated in U.S. dollars to be higher or lower than our growth in local currency when compared against other periods. We do not currently engage in currency hedging arrangements to protect us from fluctuations in the exchange rates of the euro and other currencies in relation to the U.S. dollar (and/or from inflation of such currencies), and we may be exposed to material adverse effects from such movements. We cannot predict any future trends in rates of inflation or exchange rates of other currencies against the U.S. dollar, and there can be no assurance that any contractual provisions will offset their impact, or that any future currency hedging activities will be successful.

We have significant exposure to the economic and political situations in emerging market countries, and developments in these countries could materially impact our financial results, or our business more generally.

Many of the countries in which our products are sold are emerging markets. Our global growth strategy contemplates the expansion of our existing sales activities in Latin America, Europe, the Middle East, Africa and Asia-Pacific region as well as North America. Our exposure to emerging markets has increased in recent years, as have the number and importance of our distributor arrangements. Economic and political developments in Brazil and other emerging markets, including economic crises, currency inflation, or political instability, have had in the past, and may have in the future, a material adverse effect on our financial condition and results of operations. Moreover, as these markets continue to grow, competitors may seek to enter these markets and existing market participants will likely try to aggressively protect or increase their market shares. Increased competition may result in price reductions, reduced margins and our inability to gain or hold market share, which could have an adverse effect on our financial condition and results of operations.

The political situation in the United States can affect the ability of our company to conduct business in certain areas or countries if new trade conditions are imposed or enforced by the U.S. government.

There could be negative consequences to our company’s revenue if the U.S. government unexpectedly changes its trade policies towards determined geographies or countries. These policy changes can include such things as trade barriers, which serve to limit or prevent international trade. The U.S. government may request additional funds or tariffs in exchange for the right to export items into the country. Tariffs or quotas may be used to protect domestic producers from foreign competition. Changes may include the modification or withdrawal of free trade agreements already in place. This also can have a large effect on the profits of our company because it either cuts revenues as a result of a tax on imports/exports or restricts the amount of revenues that can be earned.

Our operations involve hazardous materials and we and third parties with whom we contract must comply with environmental laws and regulations, which can be expensive and restrict how we do business, and could expose us to liability if our use of such hazardous materials causes injury.

Our manufacturing processes currently require the controlled use of potentially harmful chemicals, including highly flammable solvents. We cannot eliminate the risk of accidental contamination or injury to employees or third parties from

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the use, storage, handling or disposal of these materials. In the event of contamination or injury, we could be held liable for any resulting damages, and any liability could exceed our resources or any applicable insurance coverage we may have. Additionally, we are subject to, on an ongoing basis, federal, state and local laws and regulations governing the use, storage, handling and disposal of these materials and specified waste products. These are particularly stringent in California, where NuSil, one of our key suppliers, is located. The cost of compliance with these laws and regulations may become significant and could have an adverse effect on our financial condition, results of operations and cash flows. In the event of an accident or if we otherwise fail to comply with applicable regulations, we could lose our permits or approvals or be held liable for damages or penalized with fines.

Risks Related to Our Financial Condition and Capital Requirements

We have incurred net operating losses in the past and expect to incur net operating losses for the foreseeable future.

We have incurred net operating losses since our inception, and we continue to incur significant research and development and general and administrative expenses related to our operations. We do not expect to be profitable in 2018, and in future years we expect to incur significant research and development expenses related to, among other things, the PMA clinical study of Motiva Implants in the United States Investment in medical device product development, particularly clinical studies, is highly speculative. It entails substantial upfront capital expenditures and significant risk that any potential planned product will fail to demonstrate adequate accuracy or clinical utility. We may not be profitable for some time after the completion of this offering. As of March 31, 2018 , we had an accumulated deficit of $ $74.4 million .

We expect that our future financial results will depend primarily on our success in launching, selling and supporting Motiva Implants and other products that are part of our MotivaImagine platform. This will require us to be successful in a range of activities, including manufacturing, marketing, and selling Motiva Implants. We may not succeed in these activities and may never generate revenue that is sufficient to be profitable in the future. Even if we are profitable, we may not be able to sustain or increase profitability on a quarterly or annual basis. Our failure to achieve sustained profitability would depress the value of our company and could impair our ability to raise capital, expand our business, diversify our planned products, market our current and planned products, or continue our operations.

We may need additional funds to support our operations, and such funding may not be available to us on acceptable terms, or at all, which would force us to delay, reduce or suspend our planned development and commercialization efforts. Raising additional capital may subject us to unfavorable terms, cause dilution to our existing shareholders, restrict our operations, or require us to relinquish rights to our products and technologies.

Our operations have consumed substantial amounts of cash since our inception, and we expect to incur significant expenses in connection with our planned research, development and product commercialization efforts. We believe that our available cash, cash from operations, and the net proceeds from this offering will be sufficient to satisfy our liquidity requirements for at least the next 12 months. If our available cash resources, net proceeds from this offering and anticipated cash flow from operations are insufficient to satisfy our liquidity requirements, we may seek to sell equity or convertible debt securities, enter into a credit facility or another form of third-party funding, or seek other debt financing. Any failure to raise the funds necessary to support our operations may force us to delay, reduce or suspend our planned clinical trials, research and development programs, or other commercialization efforts.

To the extent that we raise additional capital through the sale of equity or convertible debt securities, your ownership may be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a shareholder. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take certain actions, such as incurring additional debt, making capital expenditures or declaring dividends.

On August 24, 2017, we entered into a credit agreement, or the Madryn Credit Agreement, with Madryn Health Partners, LP, or Madryn, as administrative agent, and a syndicate of lenders, or the Lenders. In January 2018, management made an assessment that we would likely default on the Madryn Credit Agreement due to our investment in our Brazilian subsidiary approaching the $5.0 million limit. We informed Madryn and the syndicate of lenders, or the Lenders, of the potential technical default event and started the process to obtain a forbearance agreement. We initially defaulted on the Madryn Credit Agreement on February 28, 2018 when our investment in our Brazilian subsidiary exceeded the $5.0 million threshold permitted under the Madryn Credit Agreement. As a result, on March 23, 2018 and subsequently on April 30, 2018, May 18, 2018 and again on June 8, 2018, we entered into a forbearance agreement with the Lenders, where the Lenders agreed to forebear from exercising certain rights and remedies through July 3, 2018 arising from certain disclosure and other technical defaults under the Madryn Credit Agreement, including those mentioned above with respect our Brazilian subsidiary. In accordance with certain cure rights under the Madryn Credit Agreement and the forbearance agreement, we will use best efforts to raise no less than $20.0 million of cash proceeds from equity

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issuances. Furthermore, the forbearance agreement increases the limit of the amount of investment in the Brazilian subsidiary an additional $5.0 million, and requires us to maintain the liquidity in accounts for which Madryn received a qualifying control agreement of no less than $2.0 million while we provide periodic reports on all investments in the Brazilian subsidiary. The forbearance agreement also prohibits the Lenders from exercising certain rights and remedies in the event of our failure to provide the report and opinion of an independent certified public accountant free from any “going concern” qualifications for the fiscal year ended December 31, 2017. We recorded the Madryn debt as a current liability on the consolidated balance sheet as of December 31, 2017. Effective June 15, 2018, the Madryn Credit Agreement was amended to remove the restrictive covenants that resulted in the technical defaults which allowed us to reclassify the arrangement as long-term as of March 31, 2018.

If we raise additional funds through collaborations, strategic collaborations or partnership, or marketing, distribution or licensing arrangements with third parties, we may be required to do so at an earlier stage than would otherwise be ideal and/or may have to limit valuable rights to our intellectual property, technologies, products, or future revenue streams, or grant licenses or other rights on terms that are not favorable to us. Furthermore, any additional fundraising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to develop and commercialize our products.

Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern.

We have experienced significant net losses and sustained negative cash flows from operations. In the three months ended March 31, 2017 , we incurred a net loss of $5.0 million and used cash for operating activities of $6.6 million . In the three months ended March 31, 2018 , we incurred a net loss of $6.5 million and used cash for operating activities of $5.9 million . We had an accumulated deficit of $67.9 million as of December 31, 2017 and $74.4 million as of March 31, 2018 . We expect to experience further significant net losses in 2018 and the foreseeable future. These factors raise substantial doubt about our ability to continue as a going concern for at least the next twelve months from the date of the issuance of the financial statements. As of and for the year ended December 31, 2017 , our independent registered public accounting firm has included an explanatory paragraph in their audit report raising substantial doubt about our ability to continue as a going concern. Our consolidated financial statements do not include any adjustments that may result from the outcome of this uncertainty. If we are unable to obtain adequate funding from this proposed offering or in the future, or if we are unable to grow our revenue substantially to achieve and sustain profitability, amongst other factors, we may not be able to continue as a going concern, and our shareholders may lose some or all of their investment in us.

Risks Related to Our Business and Our Industry

We rely on NuSil, as the sole supplier of medical-grade silicone used in our Motiva Implants as well as other products that we manufacture under contract to other customers. To our knowledge, NuSil is the only supplier of such raw materials with the appropriate filings with the FDA and other regulatory bodies to enable manufacture of products with our requirements. NuSil supplies our major competitors with raw material as well, and at least two of these are larger-volume customers of NuSil than we are.

If NuSil becomes unable or unwilling to supply sufficient quantities of medical-grade silicone of the specifications required for our products, we may not be able to replace this supply source quickly, or at all. Similarly, they may become unable or unwilling to manufacture our needed raw materials in compliance with regulatory requirements, or their manufacturing facilities may not be able to maintain compliance with regulatory requirements. Any replacement supplier would have to be qualified with the relevant regulatory authorities, which is an expensive and time-consuming process during which we may experience an interruption in our manufacturing operations. We may also be unsuccessful in negotiating favorable terms with such a supplier. Any of these contingencies would likely affect the financial results of our operations and may have a negative impact on our share price. In particular, if we are not able to establish a replacement vendor for our medical-grade silicone, we would be unable to manufacture our Motiva Implants as well as other products that we manufacture under contract to other customers until such time as a replacement vendor is identified, which would likely significantly affect the financial results of our operations and have significantly negative impact on our share price.

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Our current supply agreement with NuSil expires in December 2021. There can be no assurance that NuSil will agree to continue to supply us with medical-grade silicone following the expiration of our contract on terms that are acceptable to us, or at all. This would have a material adverse effect on our business, financial condition, and results of operations for the reasons set forth above.

In addition, our relationship with NuSil involves other risks, including but not limited to the following:


▪	it may not be able, or willing, to manufacture silicone raw materials with our agreed-upon specifications;


▪	it may not be able, or willing, to manufacture our needed raw materials in compliance with regulatory requirements, or our its manufacturing facilities may not be able to maintain compliance with regulatory requirements;


▪	it may not be able to supply sufficient quantities of each raw material quickly enough for us to respond to rapid increases in demand;


▪	it may unintentionally convey information to our competitors that is helpful in understanding our proprietary compositions and other trade secrets of our manufacturing processes;


▪	we may be subject to price fluctuations if we fail to meet certain minimum order requirements, or if our existing contract expires or is renegotiated;


▪	it may lose access to critical services and components, resulting in interruption in manufacture or shipment of medical-grade silicone;


▪	its facilities may be affected by earthquakes, wild fires, mud slides or other natural disasters, which could delay or impede production of our raw materials;


▪	we may be required to obtain regulatory approvals related to any change in our supply chain;


▪	NuSil may wish to discontinue supply of products to us due to its existing relationships with our competitors;


▪	NuSil may claim ownership of the intellectual property associated with our ProgressiveGel family of silicone gel rheologies; and


▪	NuSil or its parent entity may encounter financial or other hardships unrelated to our demand for products, which could negatively impact their ability to fulfill our orders and support our regulatory approvals.

Negative publicity concerning our products or our competitors’ products could harm our reputation and reduce demand for silicone breast implants, either of which could impact our financial results and/or share price.

The silicone breast implant industry has been the focus of significant regulatory and media scrutiny. Silicone breast implants were removed from the U.S. marketplace for a period in the 1990s and 2000s related to safety concerns. Certain patient advocacy groups exist to publicize real and perceived health risks associated with silicone breast implants and plastic surgery generally. The activities of legislative bodies, regulatory agencies, physician organizations, and other groups may lead to publicity around the real and perceived risks to patients from silicone implants. Any of these could reduce patient demand for our products, or could, even in the absence of a change in demand, negatively impact our share price. In addition, activity of this type could result in an increase in the number or size of product liability claims, which would adversely affect our business, financial results, and/or the price of our shares.

Recent studies have called into question the long-term safety of breast implants and there have also been reports of anaplastic large cell lymphoma linked to our competitors’ products. These events may lead to a reduction in the demand for silicone breast implants and could adversely affect our business.

Silicone breast implants have been associated with higher rates of anaplastic large cell lymphoma, or ALCL, a rare type of cancer affecting cells of the immune system. In January 2011, the FDA indicated that there was a possible association between saline and silicone gel-filled breast implants and higher rates of ALCL, with the causal links not yet understood. In March 2015, France’s National Cancer Institute, or NCI, noted that there is a clearly established link between ALCL and breast implants, which is referred to as breast implant-associated ALCL, or BIA-ALCL. The NCI noted in that report that most of the reported cases occurred in women with textured implants. In response, the Agence Nationale de Securite du Medicament et des Produits de Sante, or ANSM, the regulatory authority in France, has required manufacturers marketing breast implants in France, including us, to submit biocompatibility data for review, and this review is ongoing. While France by itself is a very small market for us, we anticipate that the results of this regulatory inquiry will influence other regulatory agencies in a variety of countries. It is possible that the BIA-ALCL risk factor will become highly publicized as a result, and this could negatively, and significantly, impact demand for breast implants globally.

In August 2017, the FDA updated its recommendations on BIA-ALCL and subsequently requested all breast implant manufacturers to revise their physician and patient labeling with the most up-to-date information. The August 2017

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update described BIA-ALCL as “rare” and stated “we have strengthened our understanding of this condition and concur with the World Health Organization designation of breast implant-associated anaplastic large cell lymphoma (BIA-ALCL) as a rare T-cell lymphoma that can develop following breast implants. The exact number of cases remains difficult to determine due to significant limitations in world-wide reporting and lack of global implant sales data. At this time, most data suggest that BIA-ALCL occurs more frequently following implantation of breast implants with textured surfaces rather than those with smooth surfaces.” The FDA noted it does not recommend prophylactic breast implant removal in a patient without symptoms or other abnormalities.

In March 2018, the FDA further updated its reporting on BIA-ALCL stating “w e are reporting that we are aware of 414 total cases of BIA-ALCL. Additionally, studies reported in medical literature estimate that the lifetime risk of developing BIA-ALCL for patients with textured breast implants ranges from 1 in 3,817 to 1 in 30,000.” The FDA noted that the update did not change the agency’s recommendation and that choosing to obtain a breast implant is a very personal decision that patients and providers should make with the most complete information available.

We do not produ ce the type of more rough textured implants that were involved in these reports, and, to date, no cases of BIA-ALCL have been reported in women with Motiva Implants. Future clinical studies or clinical experience may indicate that breast implants expose patients to greater risks of BIA-ALCL, which may reduce demand for silicone implants generally, expose us to product liability claims, as well as to class actions and other lawsuits. These impacts may occur in the absence of any specific linkage with our products. Moreover, if cases of BIA-ALCL or other complications are discovered in the future and/or are reported in patients with Motiva Implants, we could be subject to mandatory product recalls, suspension or withdrawal of our regulatory licensure for sale in one or more countries, and significant legal liability. Any of these may have an adverse effect on our business or operating results, or a negative impact on our share price.

Risks Related to Intellectual Property

The medical device industry is characterized by patent litigation and we could become subject to litigation that could be costly, result in the diversion of management's time and efforts, require us to pay damages or prevent us from marketing our existing or future products.

Patent litigation is prevalent in the medical device and diagnostic sectors. Our commercial success depends in part upon our ability and that of our distributors, contract manufacturers, and suppliers to manufacture, market, to sell our planned products, and to use our proprietary technologies without infringing, misappropriating or otherwise violating the proprietary rights or intellectual property of third parties. We may become party to, or be threatened with, future adversarial proceedings or litigation regarding intellectual property rights with respect to our products and technology. Third parties may assert infringement claims against us based on existing or future intellectual property rights. If we are found to infringe a third-party’s intellectual property rights, we could be required to obtain a license from such third-party to continue developing and marketing our products and technology. We may also elect to enter into such a license in order to settle pending or threatened litigation. However, we may not be able to obtain any required license on commercially reasonable terms, or at all. Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors access to the same technologies licensed to us, and could require us to pay significant royalties and other fees. We could be forced, including by court order, to cease commercializing the infringing technology or product. In addition, we could be found liable for monetary damages. A finding of infringement could prevent us from commercializing our planned products in commercially important territories, or force us to cease some of our business operations, which could harm our business. Many of our employees were previously employed at, and many of our current advisors and consultants are employed by, universities or other biotechnology, medical device or pharmaceutical companies, including our competitors or potential competitors. Although we try to ensure that our employees, advisors and consultants do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that we, or these employees, have used or disclosed intellectual property, including trade secrets or other proprietary information, of any such employee’s former employer. These and other claims that we have misappropriated the confidential information or trade secrets of third parties can have a similar negative impact on our business to the infringement claims discussed above.

Even if we are successful in defending against intellectual property claims, litigation or other legal proceedings relating to such claims may cause us to incur significant expenses, and could distract our technical and management personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our common shares. Such litigation or proceedings could substantially increase our operating losses and reduce our resources available for development activities. We may not have sufficient financial or other resources to adequately conduct such litigation or proceedings. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their

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substantially greater financial resources. Uncertainties resulting from the initiation and continuation of litigation or other intellectual property related proceedings could have a material adverse effect on our ability to compete in the marketplace.

If we fail to comply with our obligations in our intellectual property agreements, we could lose intellectual property rights that are important to our business.

We are a party, and expect to become party in the future, to certain intellectual property agreements that impose various diligence, milestone payment, royalty, insurance and other obligations on us. If we fail to comply with these obligations, any licensor may have the right to terminate such agreements, in which event we may not be able to develop and market any product that is covered by such agreements. Termination of such agreements, or reduction or elimination of our rights under such agreements, may result in our having to negotiate new or reinstated arrangements on less favorable terms, or our not having sufficient intellectual property rights to operate our business. The occurrence of such events could harm our business and financial condition.

The risks described elsewhere in this prospectus pertaining to our intellectual property rights also apply to any intellectual property rights that we may license, and any failure by us or any future licensor to obtain, maintain, defend and enforce these rights could have a material adverse effect on our business.

If we are not able to obtain and maintain intellectual property protection for our products and technologies, or if the scope of our patents is not sufficiently broad, we may not be able to effectively maintain our market leading technology position.

Our success depends in large part on our ability to obtain and maintain patent and other intellectual property protection in the United States and in other countries with respect to our proprietary technology and products.

The patent position of medical device and diagnostic companies generally is highly uncertain and involves complex legal and factual questions for which legal principles remain unresolved. In recent years, patent rights have been the subject of significant litigation. As a result, the issuance, scope, validity, enforceability and commercial value of the patent rights we rely on are highly uncertain. Pending and future patent applications may not result in patents being issued which protect our technology or products or which effectively prevent others from commercializing competitive technologies and products. Changes in either the patent laws or interpretation of the patent laws in the United States and other countries may diminish the value of the patents we rely on or narrow the scope of our patent protection. The laws of other countries may not protect our rights to the same extent as the laws of the U.S. Publications of discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until 18 months after filing, or in some cases not at all. Therefore, we cannot be certain that we were the first to make the inventions claimed in our patents or pending patent applications, or that we or were the first to file for patent protection of such inventions.

Even if the patent applications we rely on issue as patents, they may not issue in a form that will provide us with any meaningful protection, prevent competitors from competing with us or otherwise provide us with any competitive advantage. Our competitors may be able to circumvent our patents by developing similar or alternative technologies or products in a non-infringing manner. The issuance of a patent is not conclusive as to its scope, validity or enforceability, and the patents we rely on may be challenged in the courts or patent offices in the United States and abroad. Such challenges may result in patent claims being narrowed, invalidated or held unenforceable, which could limit our ability to stop or prevent us from stopping others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection of our technology and products. Given the amount of time required for the development, testing and regulatory review of new planned products, patents protecting such products might expire before or shortly after such products are commercialized. As a result, our patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours or otherwise provide us with a competitive advantage.

We may become involved in legal proceedings to protect or enforce our intellectual property rights, which could be expensive, time consuming, or unsuccessful.

Competitors may infringe or otherwise violate the patents we rely on, or our other intellectual property rights. To counter infringement or unauthorized use, we may be required to file infringement claims, which can be expensive and time-consuming. Any claims that we assert against perceived infringers could also provoke these parties to assert counterclaims against us alleging that we infringe their intellectual property rights. In addition, in an infringement proceeding, a court may decide that a patent we are asserting is invalid or unenforceable, or may refuse to stop the other party from using the technology at issue on the grounds that the patents we are asserting do not cover the technology in question. An adverse result in any litigation proceeding could put one or more patents at risk of being invalidated or

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interpreted narrowly. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation.

Interference or derivation proceedings provoked by third parties or brought by the U.S. Patent and Trademark Office, or USPTO, or any other patent authority may be necessary to determine the priority of inventions or other matters of inventorship with respect to patents and patent applications. We may become involved in proceedings, including oppositions, interferences, derivation proceedings inter partes reviews, patent nullification proceedings, or re-examinations, challenging our patent rights or the patent rights of others, and the outcome of any such proceedings are highly uncertain. An adverse determination in any such proceeding could reduce the scope of, or invalidate, important patent rights, allow third parties to commercialize our technology or products and compete directly with us, without payment to us, or result in our inability to manufacture or commercialize products without infringing third-party patent rights. Our business also could be harmed if a prevailing party does not offer us a license on commercially reasonable terms, if any license is offered at all. Litigation or other proceedings may fail and, even if successful, may result in substantial costs and distract our management and other employees. We may also become involved in disputes with others regarding the ownership of intellectual property rights. If we are unable to resolve these disputes, we could lose valuable intellectual property rights.

Even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses, and could distract our technical or management personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the market price of our common shares. Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. Uncertainties resulting from the initiation and continuation of intellectual property litigation or other proceedings could have an adverse effect on our ability to compete in the marketplace.

If we are unable to protect the confidentiality of our trade secrets, the value of our technology could be materially adversely affected, harming our business and competitive position.

In addition to our patented technology and products, we rely upon confidential proprietary information, including trade secrets, unpatented know-how, technology and other proprietary information, to develop and maintain our competitive position. Any disclosure to or misappropriation by third parties of our confidential proprietary information could enable competitors to quickly duplicate or surpass our technological achievements, thus eroding our competitive position in the market. We seek to protect our confidential proprietary information, in part, by confidentiality agreements with our employees and our collaborators and consultants. We also have agreements with our employees and selected consultants that obligate them to assign their inventions to us. These agreements are designed to protect our proprietary information, however, we cannot be certain that our trade secrets and other confidential information will not be disclosed or that competitors will not otherwise gain access to our trade secrets, or that technology relevant to our business will not be independently developed by a person that is not a party to such an agreement. Furthermore, if the employees, consultants or collaborators that are parties to these agreements breach or violate the terms of these agreements, we may not have adequate remedies for any such breach or violation, and we could lose our trade secrets through such breaches or violations. Further, our trade secrets could be disclosed, misappropriated or otherwise become known or be independently discovered by our competitors. In addition, intellectual property laws in foreign countries may not protect trade secrets and confidential information to the same extent as the laws of the United States . If we are unable to prevent disclosure of the intellectual property related to our technologies to third parties, we may not be able to establish or maintain a competitive advantage in our market, which would harm our ability to protect our rights and have an adverse effect on our business.

We may not be able to protect or enforce our intellectual property rights throughout the world.

Filing, prosecuting and defending patents on all of our planned products throughout the world may be prohibitively expensive to us. Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and, further, may export otherwise infringing products to territories where we have patent protection but where enforcement is not as strong as in the United States . These products may compete with our products in jurisdictions where we do not have any issued patents and our patent claims or other intellectual property rights may not be effective or sufficient to prevent them from so competing. Many companies have encountered significant problems in protecting and defending intellectual property rights in international jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property protection, which could make it difficult for us to stop the infringement of our patents or marketing

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of competing products in violation of our proprietary rights generally. Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial cost and divert our efforts and attention from other aspects of our business.

Obtaining and maintaining patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.

Periodic maintenance fees, renewal fees, annuity fees and various other governmental fees on patents or applications will be due to be paid by us to the USPTO and various governmental patent agencies outside of the United States in several stages over the lifetime of the patents or applications. The USPTO and various non-U.S. governmental patent agencies require compliance with a number of procedural, documentary, fee payment and other similar provisions during the patent application process. In many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules. However, there are situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, our competitors might be able to use our technologies and this circumstance would have a material adverse effect on our business.

Risks Related to Government Regulation

The regulatory approval process is expensive, time consuming and uncertain, and may prevent us from obtaining approvals for the commercialization of Motiva Implants or our planned products.

The research, testing, manufacturing, labeling, approval, selling, import, export, marketing and distribution of medical devices are subject to extensive regulation by the FDA and other regulatory authorities in the United States and other countries, where regulations differ from country to country. Our products are registered to be sold in over 60 countries, but we are not permitted to market our planned products in the United States until we receive the requisite approval or clearance from the FDA. We have not submitted an application or received marketing approval for Motiva Implants or any planned products in the United States. Obtaining PMA approval for sale for a medical device from the FDA can be a lengthy, expensive and uncertain process. In addition, failure to comply with FDA and other applicable U.S. and foreign regulatory requirements may subject us to administrative or judicially imposed sanctions, including the following:


▪	warning letters;


▪	civil or criminal penalties and fines;


▪	injunctions;


▪	suspension or withdrawal of regulatory approval;


▪	suspension of any ongoing clinical studies;


▪	voluntary or mandatory product recalls and publicity requirements;


▪	refusal to accept or approve applications for marketing approval of new devices or supplements to approved applications filed by us;


▪	restrictions on operations, including costly new manufacturing requirements; or


▪	seizure or detention of our products or import bans.

Prior to receiving approval to commercialize any of our planned products in the United States or abroad, we may be required to demonstrate with substantial evidence from preclinical and well-controlled clinical studies, and to the satisfaction of the FDA or other regulatory authorities abroad, that such planned products are safe and effective for their intended uses. Results from preclinical studies and clinical studies can be interpreted in different ways. Even if we believe the preclinical or clinical data for our planned products are promising, such data may not be sufficient to support approval by the FDA and other regulatory authorities. Administering any of our planned products to humans may produce undesirable side effects, which could interrupt, delay or cause suspension of clinical studies of our planned products and result in the FDA or other regulatory authorities denying approval of our planned products for any or all targeted indications.

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Regulatory approval from the FDA is not guaranteed, and the approval process is expensive and may take several years. The FDA also has substantial discretion in the approval process. Despite the time and expense exerted, failure can occur at any stage, and we could encounter problems that cause us to abandon or repeat clinical studies, or perform additional preclinical studies and clinical studies. The number of preclinical studies and clinical studies that will be required for FDA approval varies depending on the planned product, the indication that the planned product is designed to address and the regulations applicable to any particular planned product. The FDA can delay, limit or deny approval of a planned product for many reasons, including, but not limited to, the following:


▪	a planned product or one or more of its features may not be deemed safe or effective;


▪	FDA officials may not find the data from preclinical studies and clinical studies sufficient;


▪	the FDA might not approve our manufacturing or our third-party supplier’s processes or facilities; or


▪	the FDA may change its approval policies or adopt new regulations.

If Motiva Implants or any planned products fail to demonstrate safety and efficacy in preclinical and clinical studies or do not gain regulatory approval, our business and results of operations will be harmed.

Even if we receive regulatory approval for a planned product, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and subject us to penalties if we fail to comply with applicable regulatory requirements.

When a regulatory approval is obtained, the approved product and its manufacturer are subject to continual review by the FDA or non-U.S. regulatory authorities. Our regulatory approval for Motiva Implants, as well as any regulatory approval that we receive for Motiva Implants or for any planned products may be subject to limitations on the indicated uses for which the product may be marketed. Future approvals may contain requirements for potentially costly post-marketing follow-up studies to monitor the safety and efficacy of the approved product. In addition, we are subject to extensive and ongoing regulatory requirements by the FDA and other regulatory authorities with regard to the labeling, packaging, adverse event reporting, storage, advertising, promotion and recordkeeping for our products. In addition, we are required to comply with regulations regarding the manufacture of Motiva Implants, which include requirements related to quality control and quality assurance as well as the corresponding maintenance of records and documentation. Further, regulatory authorities must inspect these manufacturing facilities and determine they are in compliance with FDA good manufacturing practice requirements as set forth in the Quality System Regulation, or QSR, before the products can be approved. These facilities are subject to continual review and periodic inspections by the FDA and other regulatory authorities for compliance with QSR regulations. If we or a third party discover previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems with the facility where the product is manufactured, a regulatory authority may impose restrictions on that product, the manufacturer or us, including requiring withdrawal of the product from the market or suspension of manufacturing.

Health care reform measures could hinder or prevent our planned products’ commercial success.

In the United States , there have been, and we expect there will continue to be, a number of legislative and regulatory changes to the health care system in ways that could affect our future revenue and future profitability and the future revenue and future profitability of our potential customers. Federal and state lawmakers regularly propose and, at times, enact legislation, that could result in significant changes to the health care system, some of which are intended to contain or reduce the costs of medical products and services. For example, one of the most significant health care reform measures in decades, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or PPACA, was enacted in 2010. The PPACA contains a number of provisions, including those governing enrollment in federal health care programs, reimbursement changes and fraud and abuse measures, all of which will impact existing government health care programs and will result in the development of new programs. The PPACA, among other things, could result in the imposition of injunctions and imposes a tax of 2.3% on the retail sales price of medical devices sold after December 31, 2012. This tax may apply to Motiva Implants and some or all of our products which are in development. The excise tax has been temporarily suspended through the end of 2019, but will be reinstated in 2020 without additional Congressional action.

Some provisions of the PPACA have yet to be implemented, and t here have been judicial and Congressional challenges to certain aspects of the PPACA, as well as recent efforts by the Trump administration to repeal or replace certain aspects of the PPACA. While Congress has not passed comprehensive repeal legislation, we expect there will be additional challenges and amendments to the PPACA in the future as new administrations and politicians are elected . Since January 2017, two executive orders have been signed and other directives designed to delay, circumvent, or loosen certain requirements mandated by the PPACA. Concurrently, Congress has considered legislation that would repeal and replace all or part of the PPACA. While Congress has previously been successful at passing comprehensive repeal

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legislation through both Chambers of Congress, it had then been vetoed by former President Obama; however full repeal legislation is unlikely in the current political climate. Furthermore, the Tax Cuts and Jobs Act passed in December of 2017 included a provision that would repeal one of the primary pillars of the law, the PPACA’s individual mandate penalty that essentially assessed a monetary penalty or fine on certain individuals who fail to maintain qualifying health coverage for all or part of a year. Congress may consider other legislation to repeal or replace elements of the PPACA on a provision-by-provision basis. We cannot assure you that the PPACA, as currently enacted or as amended in the future, will not adversely affect our business and financial results and we cannot predict how future federal or state legislative or administrative changes relating to health care reform will affect our business. Furthermore, legislators continue efforts to repeal and replace other elements of the PPACA. While the result of these efforts is not yet known, any changes that result in price controls, reduce access to and reimbursement for care or add additional regulations may have an adverse effect on our financial condition and results of operations.

There likely will continue to be legislative and regulatory proposals at the federal and state levels directed at containing or lowering the cost of health care. We cannot predict the initiatives that may be adopted in the future or their full impact. The continuing efforts of the government, insurance companies, managed care organizations and other payors of health care services to contain or reduce costs of health care may adversely affect:


▪	our ability to set a price that we believe is fair for our products;


▪	our ability to generate revenue and achieve or maintain profitability; and


▪	the availability of capital.

If we fail to comply with health care regulations, we could face substantial penalties and our business, operations and financial condition could be adversely affected.

Even though we do not and will not control referrals of health care services or bill directly to Medicare, Medicaid or other third-party payors, certain federal and state health care laws and regulations pertaining to fraud and abuse and patients’ rights are and will be applicable to our business. If we are approved by the FDA to market our products in the United States, we could be subject to health care fraud and abuse and patient privacy regulation by both the federal government and the states in which we conduct our business. The regulations that may affect our ability to operate include, without limitation:

▪

the federal Anti-Kickback Statute, which prohibits, among other things, any person from knowingly and willfully offering, soliciting, receiving or providing remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal health care programs, such as the Medicare and Medicaid programs;

▪

the federal physician self-referral law, commonly known as the Stark Law, which prohibits, among other things, physicians who have a financial relationship, including an investment, ownership or compensation relationship with an entity, from referring Medicare and Medicaid patients to that entity for designated health services, unless an exception applies. Similarly, entities may not bill Medicare, Medicaid or any other party for services furnished pursuant to a prohibited referral. Unlike the federal Anti-Kickback Statute, the Stark Law is a strict liability statute, meaning that all of the requirements of a Stark Law exception must be met in order to be compliant with the law;


▪	the federal civil and criminal false claims and civil monetary penalties laws, including the federal False Claims Act, which prohibits, among other things, individuals or entities from knowingly presenting, or causing to be presented, false claims, or knowingly using false statements, to obtain payment from the federal government;


▪	HIPAA, which prohibits, executing a scheme to defraud any health care benefit program or making false statements relating to health care matters;


▪	the federal transparency requirements under the PPACA which requires certain manufacturers of drugs, devices, biologics and medical supplies to annual report to the HHS information related to physician payments and other transfers of value made to physicians and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members;

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


▪	state law equivalents of each of the above federal laws, such as anti-kickback, transparency and false claims laws which may apply to items or services reimbursed by any third-party payor, including commercial insurers, as well as state post-marketing compliance laws; and


▪	state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.

The PPACA, among other things, amended the intent requirement of the federal Anti-Kickback Statute and criminal health care fraud statutes. A person or entity no longer needs to have actual knowledge of this statute or specific intent to violate it. In addition, the PPACA provides that the government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the federal False Claims Act.

Similar regulations would also apply to our business in countries where we have started direct sales operations, like Brazil and several others within the European Union, where they have different regulations at European and national levels. There is a high degree of complication in complying with the different levels of regulation and the singular differences in the different countries and markets.

If our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we may be subject to penalties, including civil, criminal and administrative penalties, damages, fines, disgorgement, individual imprisonment, exclusion from participation in Medicare, Medicaid and other federal healthcare programs, individual imprisonment, additional reporting and government oversight, if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws and the curtailment or restructuring of our operations. Any such penalties or curtailment or restructuring of our operations could adversely affect our ability to operate our business and our financial results. Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business. Moreover, achieving and sustaining compliance with applicable federal, state or international privacy, security and fraud laws may prove costly.

We have obtained the authorization to distribute our products in regions/countries such as Europe and Brazil through the certification of our Quality System by the corresponding regulatory entities. Failing to demonstrate that our Quality System is in place, that consistently and systematically ensures compliance with regulations from such regions/countries might imply losing the certifications and as such, the rights to freely distribute the products which would adversely impact the company’s revenue and reputation.

French regulatory authorities at the ANSM are evaluating the biocompatibility of textured breast implants.

In February 2016, the ANSM set up a temporary scientific committee to assess the biocompatibility of implantable breast prostheses. Its objective is “to give an opinion on the documented demonstration of the biocompatibility of implantable breast implants from manufacturers.”

Accordingly, all manufacturers of breast implants marketed in France, including us, received correspondence from ANSM authorities during the first half of 2015, requesting certain biocompatibility compliance data on breast implants. A period of twelve months was set for all manufacturers to complete the demonstration of conformity with the enhanced biocompatibility requirements. During September 2016, we met with the ANSM to discuss conducting a testing plan to be completed during 2017, and have submitted information and responses to follow up requests to ANSM on multiple occasions from July 2017 to November 2017. The ANSM authorities have stated that they may suspend marketing of implants that do not demonstrate conformity within the timeframe given. While France by itself is a very small market for us, we anticipate that the results of this regulatory inquiry will influence other regulatory agencies in a variety of countries. It is possible that the ALCL risk factor will become highly publicized as a result, and this could negatively, and significantly, impact demand for breast implants globally. Any suspension of sale of our implants in France would adversely affect our business and sales in France and could negatively influence our sales in other countries.

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The Dutch Health Care Inspectorate, together with the RIVM, are evaluating silicone breast implants through a market surveillance study.

In 2015, the Netherlands National Institute for Public Health and the Environment, or RIVM, commissioned by the Dutch Health Care Inspectorate, initiated an assessment of the ten manufacturers that commercialize breast implants on the Dutch market, including us. The purpose was to investigate the quality of the silicone breast implants addressing a revision of the technical files, a physical-chemical characterization of the silicone materials, biocompatibility and identifying any concern related to the patient safety.

For this investigation, important parts of the technical files of each manufacturer of silicone breast implants were evaluated. In parallel, laboratory analyses were performed on the chemical composition and potentially harmful properties of the implants. Each manufacturer was evaluated based on the assessment of the technical files, and the information was published initially without identifying the results to the manufacturer.

Subsequently, each manufacturer presented an update of the findings and observations of this evaluation. In February 2018, the results of the updated assessment were published for the market surveillance study. In this reassessment, we corrected a typographical error in the name of our silicone gel. Laboratory analyses of the actual implants showed no deviations that could cause health damage. The Dutch Health Care Inspectorate has not revealed if they will continue with the assessments on a periodic basis or what other aspects they may evaluate. Any deficiencies of our implants in the Netherlands could adversely affect our business and sales in Europe and throughout the world.

Risks Related to This Offering and Ownership of Our Securities

Our share price may be volatile, and purchasers of our securities could incur substantial losses.

Our share price is likely to be volatile. The securities markets in general, and the market for biotechnology and medical device companies in particular, have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. As a result of this volatility, investors may not be able to sell their common shares at or above the initial public offering price. The market price for our shares may be influenced by many factors, including the following:


▪	our ability to successfully commercialize, and realize revenues from sales of, Motiva Implants, MotivaImagine Centers and Motiva branded surgeries;


▪	the success of competitive products or technologies;


▪	results of clinical studies of Motiva Implants or planned products or those of our competitors;


▪	regulatory or legal developments in the United States and other countries, especially changes in laws or regulations applicable to our products;


▪	introductions and announcements of new products by us, our commercialization partners, or our competitors, and the timing of these introductions or announcements;


▪	actions taken by regulatory agencies with respect to our products, clinical studies, manufacturing processes or sales and marketing terms;


▪	variations in our financial results or those of companies that are perceived to be similar to us;


▪	the success of our efforts to acquire or in-license additional products or planned products;


▪	developments concerning our collaborations, including but not limited to those with our sources of manufacturing supply and our commercialization partners;


▪	developments concerning our ability to bring our manufacturing processes to scale in a cost-effective manner;


▪	announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures or capital commitments;


▪	developments or disputes concerning patents or other proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our products;


▪	our ability or inability to raise additional capital and the terms on which we raise it;


▪	the recruitment or departure of key personnel;


▪	changes in the structure of health care payment systems;


▪	negative shifts in the economy effecting the number of aesthetic breast procedures;


▪	market conditions in the pharmaceutical and biotechnology sectors;


▪	actual or anticipated changes in earnings estimates or changes in securities analyst recommendations regarding our common shares, other comparable companies or our industry generally;


▪	trading volume of our common shares;

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▪	sales of our common shares by us or our shareholders;


▪	general economic, industry and market conditions; and


▪	the other risks described in this “Risk Factors” section.

These broad market and industry factors may harm the market price of our common shares, regardless of our operating performance. In the past, following periods of volatility in the market, securities class-action litigation has often been instituted against companies. Such litigation, if instituted against us, could result in substantial costs and diversion of management’s attention and resources, which could adversely affect our business, financial condition, results of operations and growth prospects.

CPH TU, LP, an entity affiliated with one of our directors, owns and will own after this offering a significant percentage of our common shares and will exercise significant influence over matters requiring shareholder approval.

Based upon the assumed number of shares to be sold in this offering and the assumed midpoint of the price range, each as set forth on the cover page of this prospectus, CPH TU, LP, or CPH, an entity affiliated with one of our directors, Nicholas Lewin, will beneficially own 48.0% of our outstanding common shares following this offering (assuming no exercise of the underwriters’ option to purchase additional shares). Nicholas Lewin and CPH will therefore have significant influence over management and significant control over matters requiring shareholder approval, including the annual election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets, for the foreseeable future. This concentrated control may limit shareholders’ ability to influence corporate matters and, as a result, we may take actions that our shareholders do not view as beneficial. As a result, the market price of our common shares could be adversely affected.

Future sales of our common shares, or the perception that future sales may occur, may cause the market price of our common shares to decline, regardless of our operating performance.

Sales of substantial amounts of our common shares in the public market after this offering, or the perception that these sales may occur, could materially and adversely affect the price of our common shares and could impair our ability to raise capital through the sale of additional equity securities. The common shares sold in this offering will be freely tradable, without restriction, in the public market, except for any shares sold to our affiliates.

In connection with this offering, we, our officers, directors, certain of our option holders, and holders of substantially all of our outstanding share capital have agreed, prior to the commencement of this offering, subject to specified exceptions, not to directly or indirectly sell or transfer any common shares for 180 days after the date of this prospectus without the consent of Jefferies LLC, or Jefferies, and Cowen and Company, LLC, or Cowen. However, Jefferies and Cowen may release these shares from any restrictions at any time. We cannot predict what effect, if any, market sales of shares held by any shareholder or the availability of shares for future sale will have on the market price of our common shares.

Approximately common shares may be sold in the public market by existing shareholders after the date of this prospectus and an additional common shares may be sold in the public market by existing shareholders 181 days after the date of this prospectus, subject to volume and other limitations imposed under the federal securities laws. Sales of substantial amounts of our common shares in the public market after the completion of this offering, or the perception that such sales could occur, could adversely affect the market price of our common shares and could materially impair our ability to raise capital through offerings of our common shares. See the section titled “Shares Eligible for Future Sale” for a more detailed description of the restrictions on selling shares of our common shares after this offering.

We are an “emerging growth company,” and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies will make our common shares less attractive to investors.

We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act, or the JOBS Act, which was enacted in April 2012. For as long as we continue to be an emerging growth company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We could be an emerging growth company for up to five years, although circumstances could cause us to lose that status earlier. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year following the fifth anniversary of the completion of this offering, (2) the last day of the fiscal year in which we have

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total annual gross revenue of at least $1.07 billion, (3) the date on which we are deemed to be a large accelerated filer, which means the market value of our common shares that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (4) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. We cannot predict if investors will find our common shares less attractive because we may rely on these exemptions. If some investors find our common shares less attractive as a result, there may be a less active trading market for our common shares and our share price may suffer or be more volatile.

We could be subject to securities class action litigation.

In the past, securities class action litigation has often been instituted against companies whose securities have experienced periods of volatility in market price. Securities litigation brought against us following volatility in the price of our ordinary shares, regardless of the merit or ultimate results of such litigation, could result in substantial costs, which would hurt our financial condition and results of operations and divert management’s attention and resources from our business.

After this offering, our executive officers, directors and principal shareholders will continue to maintain the ability to control or significantly influence all matters submitted to shareholders for approval.

Upon the closing of this offering, our executive officers, directors and shareholders who owned more than 5% of our outstanding common shares before this offering will, in the aggregate, beneficially own shares representing approximately % of our common shares, based on common shares outstanding as of the date of this offering, including the common shares issuable upon conversion of our convertible promissory notes upon the closing of this offering and after giving effect to the sale of shares in this offering. As a result, if these shareholders were to choose to act together, they would be able to control or significantly influence all matters submitted to our shareholders for approval, as well as our management and affairs. For example, these shareholders, if they choose to act together, will control or significantly influence the election of directors and approval of any merger, consolidation or sale of all or substantially all of our assets. This concentration of voting power could delay or prevent an acquisition of our company on terms that other shareholders may desire.

We will incur significant increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives.

As a public company, we will incur significant legal, accounting and other expenses that we did not incur as a private company. We will be subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, the other rules and regulations of the Securities and Exchange Commission, or SEC, and the rules and regulations of the Nasdaq Capital Market, or Nasdaq. The expenses that will be required in order to adequately prepare for being a public company will be material, and compliance with the various reporting and other requirements applicable to public companies will require considerable time and attention of management. For example, the Sarbanes-Oxley Act and the rules of the SEC and national securities exchanges have imposed various requirements on public companies, including requiring establishment and maintenance of effective disclosure and financial controls. Our management and other personnel will need to devote a substantial amount of time to these compliance initiatives. These rules and regulations will continue to increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, we expect these rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits on coverage or incur substantial costs to maintain the same or similar coverage. The impact of these events could also make it more difficult for us to attract and retain qualified personnel to serve on our board of directors, our board committees, or as executive officers.

The Sarbanes-Oxley Act requires, among other things, that we maintain effective internal control over financial reporting and disclosure controls and procedures. In particular, we must perform system and process evaluation and testing of our internal control over financial reporting to allow management to report on the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, beginning with our second annual report on Form 10-K. In addition, we will be required to have our independent registered public accounting firm attest to the effectiveness of our internal control over financial reporting beginning with our annual report on Form 10-K following the date on which we are no longer an emerging growth company. Our compliance with Section 404 of the Sarbanes-Oxley Act will require that we incur substantial accounting expense and expend significant management efforts. We currently

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do not have an internal audit group, and we will need to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge. If we are not able to comply with the requirements of Section 404 in a timely manner, or if we or our independent registered public accounting firm identify deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price of our shares could decline and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities, which would require additional financial and management resources.

Our ability to successfully implement our business plan and comply with Section 404 requires us to be able to prepare timely and accurate financial statements. We expect that we will need to continue to improve existing, and implement new operational and financial systems, procedures and controls to manage our business effectively. Any delay in the implementation of, or disruption in the transition to, new or enhanced systems, procedures or controls, may cause our operations to suffer and we may be unable to conclude that our internal control over financial reporting is effective and to obtain an unqualified report on internal controls from our auditors as required under Section 404 of the Sarbanes-Oxley Act. This, in turn, could have an adverse impact on trading prices for our common shares, and could adversely affect our ability to access the capital markets.

We have identified material weaknesses in our internal control over financial reporting as of December 31, 2017, and may identify additional material weaknesses in the future that may cause us to fail to meet our reporting obligations or result in material misstatements of our consolidated financial statements. If we fail to remedy our material weaknesses, or if we fail to establish and maintain effective control over financial reporting, our ability to accurately and timely report our financial results could be adversely affected.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. generally accepted accounting principles. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented or detected on a timely basis. Prior to the completion of this offering, we have been a private company with limited accounting and compliance personnel and other resources to address our internal control over financial reporting.

In connection with the preparation and audit of our 2016 financial statements, w e had two material weaknesses. First, we did not maintain a sufficient complement of resources with an appropriate level of accounting knowledge, U.S. GAAP experience and training commensurate with our structure and financial reporting requirements. Second, we did not have adequate separation of duties to provide for appropriate control of cash and other accounts.

We have hired additional personnel in our accounting department, and hired consultants with technical expertise to account for our complex financial instruments related to our debt agreements with CPH, and Perceptive Credit Holdings, L.P., or Perceptive, as well as other business combination and asset acquisition accounting.

Management determined that these material weakness were remediated as of December 31, 2017.

In connection with the preparation and audit of our 2017 financial statements, w e had the following material weaknesses. We did not perform adequate reviews of the accounting for each tranche of the debt outstanding under the Madryn Credit Agreement and the standard-to-actual inventory costing. Further, at our Brazilian subsidiary, we did not employ an adequate number of accounting and finance professionals with the requisite expertise in order to timely and accurately capture, record and review the high volume of transactions.

We are in the process of improving policies and procedures and designing more effective controls to remediate these material weaknesses, but our remediation efforts are not complete and are ongoing. If our remedial measures are insufficient to address the material weaknesses, or if additional material weaknesses or significant deficiencies in our internal control are discovered or occur in the future, it may materially adversely affect our ability to report our financial condition and results of operations in a timely and accurate manner and impact investor confidence in our Company.

The actions we have taken are subject to continued review, supported by confirmation and testing by management as well as audit committee oversight. While we have implemented a plan to remediate these material weaknesses we cannot assure you that we will be able to remediate them, which could impair our ability to accurately and timely report our consolidated financial position, results of operations, or cash flows. Our failure to remediate the material weaknesses identified above or the identification and remediation of additional material weaknesses in the future, could adversely affect our ability to report financial information, including our filing of quarterly or annual reports with the SEC on a timely and accurate basis. Moreover, our failure to remediate the material weakness identified above or the identification

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of additional material weaknesses, could prohibit us from producing timely and accurate consolidated financial statements, which may adversely affect our share price and we may be unable to maintain compliance with Nasdaq listing requirements.

Our ability to use net operating losses to offset future taxable income and certain other tax attributes may be subject to certain limitations.

Federal and California laws impose restrictions on the utilization of net operating loss carryforwards and research and development credit carryforwards in the event of a change in ownership of the company, which constitutes an “ownership change” as defined by Internal Revenue Code Sections 382 and 383. Generally, an ownership change occurs if the percentage of the value of the shares that are owned by one or more direct or indirect “five percent shareholders” increases by more than 50% over their lowest ownership percentage at any time during the applicable testing period. If we have experienced an “ownership change” at any time since our formation, we may already be subject to limitations on our ability to utilize our existing net operating losses and other tax attributes. We have not experienced an ownership change in the past that would materially impact the availability of its net operating losses and tax credits. Nevertheless, future changes in our share ownership, which may be outside of our control, may trigger an “ownership change” and, consequently, Section 382 and 383 limitations. We have not completed a Section 382 and 383 analysis to determine if an ownership change has occurred. Until such analysis is completed, we cannot be sure that the full amount of the existing net operating loss carryforwards will be available to us, even if we do generate taxable income before their expiration. In addition, under the newly enacted U.S. federal income tax law, federal net operating losses incurred in 2018 and in future years may be carried forward indefinitely, but the deductibility of such federal net operating losses is limited.

The recently passed comprehensive U.S. tax reform bill could adversely affect our business and financial condition.

On December 22, 2017, new legislation was passed that significantly revises the Internal Revenue Code of 1986, as amended. The newly enacted U.S. federal income tax law, among other things, contains significant changes to corporate taxation, including reduction of the corporate tax rate from a top marginal rate of 35% to a flat rate of 21%, limitation of the tax deduction for interest expense to 30% of adjusted earnings (except for certain small businesses), limitation of the deduction for net operating losses to 80% of current year taxable income and elimination of net operating loss carrybacks, one time taxation of offshore earnings at reduced rates regardless of whether they are repatriated, elimination of U.S. tax on foreign earnings (subject to certain important exceptions), immediate deductions for certain new investments instead of deductions for depreciation expense over time, and modifying or repealing many business deductions and credits. Notwithstanding the reduction in the corporate income tax rate, the overall impact of the new federal tax law is uncertain and our business and financial condition could be adversely affected. In addition, it is uncertain if and to what extent various states will conform to the newly enacted federal tax law. The impact of this tax reform on holders of our common shares is also uncertain and could be adverse. We urge our stockholders to consult with their legal and tax advisors with respect to this legislation and the potential tax consequences of investing in or holding our common shares.

Tax authorities may disagree with our positions and conclusions regarding certain tax positions, resulting in unanticipated costs, taxes or non-realization of expected benefits.

A tax authority may disagree with tax positions that we have taken, which could result in increased tax liabilities. For example, the U.S. Internal Revenue Service or another tax authority could challenge the amounts paid between our affiliated companies pursuant to our intercompany arrangements and transfer pricing policies. A tax authority may take the position that material income tax liabilities, interest and penalties are payable by us, in which case, we expect that we might contrast such assessment. Contesting such an assessment may be lengthy and costly and if we were unsuccessful in disputing the assessment, the implications could increase our anticipated effective tax rate, where applicable. In addition, we may be subject to additional tax liabilities, which could materially and adversely affect our business, financial condition and results of operations. The application, interpretation and enforcement value-added tax, or VAT, and other taxes and related regulations applicable to medical device companies is complex and evolving.

Discontinuation of preferential tax treatments we currently enjoy or other unfavorable changes in tax law could result in additional compliance obligations and costs.

Discontinuation of preferential tax treatments we currently enjoy or other unfavorable changes in tax law could result in additional compliance obligations and costs. We are currently the beneficiary of a tax holiday in Costa Rica pursuant to which we are subject to a tax at a 6% rate. We are in the process of applying for, and expect to receive, a tax holiday in Costa Rica under which we would be subject to tax at a 0% rate. However, there can be no assurance that we will

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continue to qualify for or receive such favorable tax treatment. If we fail to maintain such favorable tax treatment we may be subject to tax in Costa Rica at a significantly higher rate.

If a United States person is treated as owning at least 10% of our common shares, such holder may be subject to adverse U.S. federal income tax consequences.

If a United States person is treated as owning (directly, indirectly, or constructively) at least 10% of the value or voting power of our ordinary shares, such person may be treated as a “United States shareholder” with respect to each “controlled foreign corporation” in our group (if any). Because our group includes one or more U.S. subsidiaries, certain of our non-U.S. subsidiaries could be treated as controlled foreign corporations (regardless of whether or not we are treated as a controlled foreign corporation). A U.S. shareholder of a controlled foreign corporation may be required to report annually and include in its U.S. taxable income its pro rata share of “Subpart F income,” “global intangible low-taxed income,” and investments in U.S. property by controlled foreign corporations, regardless of whether we make any distributions. An individual that is a U.S. shareholder with respect to a controlled foreign corporation generally would not be allowed certain tax deductions or foreign tax credits that would be allowed to a U.S. shareholder that is a U.S. corporation. Failure to comply with these reporting obligations may subject a U.S. shareholder to significant monetary penalties and may prevent the statute of limitations with respect to such shareholder’s U.S. federal income tax return for the year for which reporting was due from starting. We cannot provide any assurances that we will assist investors in determining whether any of our non-U.S. subsidiaries is treated as a controlled foreign corporation or whether any investor is treated as a U.S. shareholder with respect to any such controlled foreign corporation or furnish to any U.S. shareholders information that may be necessary to comply with the aforementioned reporting and tax paying obligations. A U.S. investor should consult its advisors regarding the potential application of these rules to an investment in our common shares.

If you purchase our securities in this offering, you will incur immediate and substantial dilution in the book value of your investment.

The initial public offering price is substantially higher than the net tangible book value per share of our securities. Investors purchasing shares in this offering will pay a price per share that substantially exceeds the book value of our tangible assets after subtracting our liabilities. As a result, investors purchasing shares in this offering will incur immediate dilution of $ per share, based on an assumed initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover of this prospectus. Further, investors purchasing shares in this offering will contribute approximately % of the total amount invested by shareholders since our inception, but will own, as a result of such investment, only approximately % of common shares outstanding immediately following this offering.

The exercise of any of our outstanding options would result in additional dilution. As a result of the dilution to investors purchasing shares in this offering, investors may receive significantly less than the purchase price paid in this offering, if anything, in the event of our liquidation. Further, because we may need to raise additional capital to fund our clinical development programs, we may in the future sell substantial amounts of common shares or securities convertible into or exchangeable for common shares. These future issuances of equity or equity-linked securities, together with the exercise of outstanding options and any additional shares issued in connection with acquisitions, if any, may result in further dilution to investors.

No public market for our common shares currently exists and an active trading market may not develop or be sustained following this offering.

There is no established trading market for our securities, and the market for our securities may be highly volatile or may decline regardless of our operating performance. Prior to this offering, you could not buy or sell our securities publicly. An active public market for our securities may not develop or be sustained after this offering. We cannot predict the extent to which investor interest in our company will lead to the development of an active trading market in our common shares or how liquid that market might become. An active and liquid trading market may be further hindered to the extent certain of our existing investors purchase shares in this offering. If a market does not develop or is not sustained, it may be difficult for you to sell your securities at the time you wish to sell them, at a price that is attractive to you, or at all.

The initial public offering price per share has been determined through negotiation between us and representatives of the underwriters, and may not be indicative of the market prices that prevail after this offering. You may not be able to sell your common shares at or above the initial public offering price.

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If securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, our common share price and trading volume could decline.

The trading market for our common shares will depend, in part, on the research and reports that securities or industry analysts publish about us or our business. Securities and industry analysts do not currently, and may never, publish research on our company. If no securities or industry analysts commence coverage of our company, the trading price for our common shares would likely be negatively impacted. In the event securities or industry analysts initiate coverage, if one or more of the analysts who cover us downgrade our common shares or publish inaccurate or unfavorable research about our business, our share price would likely decline. In addition, if our operating results fail to meet the forecast of analysts, our share price would likely decline. If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, demand for our common shares could decrease, which might cause our share price and trading volume to decline.

Our management team may invest or spend the proceeds of this offering in ways with which you may not agree or in ways which may not yield a return.

Although we currently intend to use the net proceeds from this offering in the manner described in the section titled “Use of Proceeds,” our management will have broad discretion in the application of the balance of the net proceeds from this offering and could spend the proceeds in ways that do not improve our results of operations or enhance the value of our common shares. The failure by our management to apply these funds effectively could result in financial losses that could have a material adverse effect on our business, cause the price of our common shares to decline and delay the commercialization of Motiva Implants or other planned products. Pending their use, we may invest the net proceeds from this offering in a manner that does not produce income or that loses value.

Provisions in our amended and restated memorandum and articles of association and under British Virgin Islands law could make an acquisition of us more difficult and may prevent attempts by our shareholders to replace or remove our current management.

Provisions in our amended and restated memorandum and articles of association that will become effective upon the closing of this offering may discourage, delay or prevent a merger, acquisition or other change in control of us that shareholders may consider favorable, including transactions in which shareholders might otherwise receive a premium for their shares. These provisions could also limit the price that investors might be willing to pay in the future for our common shares, thereby depressing the market price of our common shares. In addition, these provisions may frustrate or prevent any attempts by our shareholders to replace or remove our current management by making it more difficult for shareholders to replace members of our board of directors. Because our board of directors is responsible for appointing the members of our management team, these provisions could in turn affect any attempt by our shareholders to replace current members of our management team. Among others, these provisions include the following:


▪	our board of directors will be divided into three classes with staggered three-year terms which may delay or prevent a change of our management or a change in control;


▪	our board of directors will have the right to elect directors to fill a vacancy created by the expansion of our board of directors or the resignation, death or removal of a director, which will prevent shareholders from being able to fill vacancies on our board of directors;


▪	our shareholders will not be able to act by written consent, as a result, a holder, or holders, controlling a majority of our shares would not be able to take certain actions other than at annual shareholders’ meetings or special shareholders’ meetings;


▪	our amended and restated memorandum and articles of association do not allow cumulative voting in the election of directors, which limits the ability of minority shareholders to elect director candidates;


▪	amendments of our amended and restated memorandum and articles of association will require the approval of shareholders holding 66 2/3% of our outstanding voting shares (unless amended by the board of directors);

▪

our shareholders will be required to provide advance notice and additional disclosures in order to nominate individuals for election to our board of directors or to propose matters that can be acted upon at a shareholders’ meeting, which may discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror’s own slate of directors or otherwise attempting to obtain control of our company; and


▪	our board of directors will be able to issue, without shareholder approval, preferred shares with voting or other rights or preferences that could impede the success of any attempt to acquire us.

Moreover, because we are incorporated in the British Virgin Islands, we are governed by the provisions of BVI Business Companies Act, 2004, as amended, or the BVI Act, which provide for different shareholder rights than a Delaware

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corporation. See, for example, the risk factor titled “Rights of shareholders under British Virgin Islands law differ from those under U.S. law, and, accordingly, you may have fewer protections as a shareholder.”

Our employment agreements with our executive officers may require us to pay severance benefits to any of those persons who are terminated in connection with a change in control of us, which could harm our financial condition or results.

Certain of our executive officers are parties to employment agreements that contain change in control and severance provisions providing for aggregate cash payments of up to approximately $ million for severance and other benefits and acceleration of vesting of share options in the event of a termination of employment in connection with a change in control of our company. The accelerated vesting of options could result in dilution to our existing shareholders and harm the market price of our common shares. The payment of these severance benefits could harm our financial condition and results. In addition, these potential severance payments may discourage or prevent third parties from seeking a business combination with our company.

Because we do not anticipate paying any cash dividends on our common shares in the foreseeable future, capital appreciation, if any, will be our shareholders’ sole source of gain.

We have in the past declared dividends on our share capital. Please see Note 8 to our annual consolidated financial statements for further information. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our business. In addition, the terms of existing or any future debt agreements may preclude us from paying dividends. For example, our credit agreement and guaranty with Madryn restricts our ability to pay dividends. As a result, capital appreciation, if any, of our common shares will be our shareholders’ sole source of gain for the foreseeable future.

Risks Related to Being a British Virgin Islands Company

Rights of shareholders under British Virgin Islands law differ from those under U.S. law, and, accordingly, you may have fewer protections as a shareholder.

Our corporate affairs are governed by our amended and restated memorandum and articles of association, the BVI Act, and the common law of the British Virgin Islands. The rights of shareholders to take legal action against our directors, actions by minority shareholders and the fiduciary responsibilities of our directors under British Virgin Islands law are to a large extent governed by the common law of the British Virgin Islands and by the BVI Act. The common law of the British Virgin Islands is derived in part from comparatively limited judicial precedent in the British Virgin Islands as well as from English common law, which has persuasive, but not binding, authority on a court in the British Virgin Islands. The rights of our shareholders and the fiduciary responsibilities of our directors under British Virgin Islands law are not as clearly established as they would be under statutes or judicial precedents in some jurisdictions in the United States. In particular, the British Virgin Islands has a less developed body of securities laws as compared to the United States , and some states (such as Delaware) have more fully developed and judicially interpreted bodies of corporate law. As a result of the foregoing, holders of our ordinary shares may have more difficulty in protecting their interests through actions against our management, directors or major shareholders than they would as shareholders of a U.S. company.

The laws of the British Virgin Islands provide limited protection for minority shareholders, so minority shareholders will have limited or no recourse if they are dissatisfied with the conduct of our affairs.

Under the laws of the British Virgin Islands, there is limited statutory law for the protection of minority shareholders other than the provisions of the BVI Act dealing with shareholder remedies, as summarized under “Description of Share Capital-Shareholders’ Rights Under British Virgin Islands Law Generally.” One protection under statutory law is that shareholders may bring an action to enforce the constituent documents of a British Virgin Islands company and are entitled to have the affairs of the company conducted in accordance with the BVI Act and the amended and restated memorandum and articles of association of the company. As such, if those who control the company have disregarded the requirements of the BVI Act or the provisions of our amended and restated memorandum and articles of association, then the courts will likely grant relief. Generally, the areas in which the courts will intervene are the following: (i) an act complained of which is illegal; (ii) acts that constitute oppression, unfair discrimination or unfair prejudice against the minority where the wrongdoers control the company; (iii) acts that infringe on the personal rights of the shareholders, such as the right to vote; and (iv) acts where we have not complied with provisions requiring approval of a special or extraordinary majority of shareholders, which are more limited than the rights afforded to minority shareholders under the laws of many states in the United States.

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British Virgin Islands law differs from the laws in effect in the United States, and U.S. investors may have difficulty enforcing civil liabilities against us, our directors or members of senior management named in this prospectus.

Under our amended and restated memorandum and articles of association, we may indemnify and hold our directors harmless against all claims and suits brought against them, subject to limited exceptions. Furthermore, to the extent allowed by law, the rights and obligations among or between us, any of our current or former directors, officers and employees and any current or former shareholder will be governed exclusively by the laws of the British Virgin Islands and subject to the jurisdiction of the British Virgin Islands courts, unless those rights or obligations do not relate to or arise out of their capacities as such. Although there is doubt as to whether U.S. courts would enforce these provisions in an action brought in the United States, under U.S. securities laws, these provisions could make judgments obtained outside of the British Virgin Islands more difficult to enforce against our assets in the British Virgin Islands or jurisdictions that would apply British Virgin Islands law.

British Virgin Islands companies may not be able to initiate shareholder derivative actions, thereby depriving shareholders of one avenue to protect their interests.

British Virgin Islands companies may not have standing to initiate a shareholder derivative action in a federal court of the United States . The circumstances in which any such action may be brought, and the procedures and defenses that may be available in respect of any such action, may result in the rights of shareholders of a British Virgin Islands company being more limited than those of shareholders of a company organized in the United States. Accordingly, shareholders may have fewer alternatives available to them if they believe that corporate wrongdoing has occurred. The British Virgin Islands courts are also unlikely to recognize or enforce judgments of courts in the United States based on certain liability provisions of U.S. securities law, or to impose liabilities based on certain liability provisions of the U.S. securities laws that are penal in nature, in original actions brought in the British Virgin Islands. There is no statutory recognition in the British Virgin Islands of judgments obtained in the United States, although the courts of the British Virgin Islands will generally recognize and enforce the non-penal judgment of a non-U.S. court of competent jurisdiction without retrial on the merits. This means that even if shareholders were to sue us successfully, they may not be able to recover anything to make up for the losses suffered.

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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

This prospectus, including the sections titled “Prospectus Summary,” “Risk Factors,” “Use of Proceeds,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Industry and Market Data,” “Business” and “Shares Eligible for Future Sale,” contains forward-looking statements. In some cases you can identify these statements by forward-looking words, such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “could,” “would,” “project,” “plan,” “potential,” “seek,” “expect,” “goal,” or the negative or plural of these words or similar expressions. These forward-looking statements include, but are not limited to, statements concerning the following:


▪	our expected uses of the net proceeds from this offering;


▪	the timing and the success of U.S. approval of our Motiva Implants pursuant to our clinical and regulatory efforts;


▪	our ability to successfully commercialize our Motiva Implants in the United States;


▪	our ability to maintain regulatory approval of Motiva Implants in jurisdictions outside the United States or to obtain and maintain regulatory approval of other future products in any jurisdiction;


▪	our expectation that our existing capital resources and the net proceeds from this offering will be sufficient to fund a PMA clinical trial for Motiva Implants in the United States;


▪	the benefits of the use of Motiva Implants and our other products, services and technologies;


▪	the rate and degree of market acceptance of Motiva Implants and our other current or future products;


▪	our expectations regarding government and third-party payor coverage and reimbursement;


▪	our ability to manufacture our products in conformity with FDA requirements and to scale up manufacturing of our products to commercial scale;


▪	our ability to successfully build our relationships with distributors and direct sales force and commercial infrastructures;


▪	our ability to effectively compete in our markets;


▪	our reliance on third parties to conduct clinical studies;


▪	our reliance on third-party suppliers for certain product components, some of which are single source suppliers;


▪	our reliance on our collaboration partners’ performance over which we do not have control;


▪	our ability to retain and recruit key personnel, including development of a sales and marketing function in Brazil;


▪	our ability to obtain and maintain intellectual property protection for Motiva Implants and our other current and future products;


▪	our estimates of our expenses, ongoing losses, future revenue, capital requirements and our needs for, or ability to, obtain additional financing;


▪	our financial performance; and


▪	developments and projections relating to our competitors or our industry.

These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in the section titled “Risk Factors.” Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this prospectus may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. We undertake no obligation to update publicly any forward-looking statements for any reason after the date of this prospectus to conform these statements to actual results or to changes in our expectations , except as required under applicable law .

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You should read this prospectus and the documents that we reference in this prospectus and have filed with the SEC as exhibits to the registration statement of which this prospectus forms a part with the understanding that our actual future results, levels of activity, performance and events and circumstances may be materially different from what we expect.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this prospectus, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.

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INDUSTRY AND MARKET DATA

We obtained the industry, market and similar data set forth in this prospectus from our own internal estimates and research, industry publications and surveys and studies conducted by third parties. These data involve a number of assumptions and limitations, and you are cautioned not to give undue weight to such information and estimates.

Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. In some cases, we do not expressly refer to the sources from which this data is derived. In that regard, when we refer to one or more sources of this type of data in any paragraph, you should assume that other data of this type appearing in the same paragraph is derived from the same sources, unless otherwise expressly stated or the context otherwise requires.

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USE OF PROCEEDS

We estimate that the net proceeds from our issuance and sale of our common shares in this offering will be approximately $ million, or approximately $ million if the underwriters exercise their option to purchase additional shares in full, assuming an initial public offering price of $ per common share, the midpoint of the price range set forth on the cover page of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

We intend to use the net proceeds from this offering as follows:


▪	approximately $ million to $ million to fund a PMA study in order to obtain regulatory approval to market and sell our Motiva Implants in the United States;


▪	approximately $5.0 million to fund the repayment of indebtedness due to former Class Z preferred shareholders pursuant to promissory notes we issued to such holders in exchange for such shares; and


▪	the remainder to fund working capital and other general corporate purposes.

This expected use of the net proceeds from this offering represents our intentions based upon our current plans and business conditions. The amounts and timing of our actual expenditures may vary significantly depending on numerous factors, including the progress of our development and commercialization efforts and the status of and results from clinical studies, as well as any collaborations that we may enter into with third parties and any unforeseen cash needs. As a result, our management will retain broad discretion over the allocation of the net proceeds from this offering.

Pending our use of the net proceeds from this offering, we intend to invest the net proceeds in a variety of capital preservation investments, including short-term, investment grade, interest bearing instruments such as money market funds, certificates of deposit, commercial paper and U.S. government securities.

DIVIDEND POLICY

We have in the past declared dividends on our share capital. We currently intend to retain all available funds and any future earnings for use in the operation of our business and do not anticipate paying any dividends in the foreseeable future. Future determination as to the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then existing conditions, including our operating results, financial conditions, contractual restrictions, capital requirements, business prospects and other factors our board of directors may deem relevant. In addition, our credit agreement with Madryn Health Partners, LP, or Madryn, as administrative agent, and a syndicate of lenders restricts our ability to pay dividends.

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CAPITALIZATION

The following table sets forth our cash and capitalization as of March 31, 2018 :


▪	on an actual basis;


▪	on a pro forma basis to reflect the conversion of our issued and outstanding ordinary shares into an aggregate of 14,771,383 common shares immediately prior to the completion of this offering ; and

▪

on a pro forma as adjusted basis to further reflect (i) the sale by us of common shares in this offering at an assumed initial public offering price of $ per common share, which is the midpoint of the price range set forth on the cover page of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us and (ii) the repayment of $5.0 million to fund the repayment of indebtedness due to former Class Z preferred shareholders pursuant to promissory notes we issued to such holders in exchange for such shares .

You should read this table together with the sections titled “Selected Consolidated Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our audited and unaudited consolidated financial statements and related notes included elsewhere in this prospectus.




	As of March 31, 2018
	Actual			Pro Forma	Pro Forma As Adjusted ⁽¹⁾
	(unaudited) (in thousands, except share and per share data)
Cash	$	6,613

Notes payable related party, including accrued interest	$	4,994
Note payable, Madryn, net of debt discount and issuance costs	19,908
Shareholders’ equity (deficit):
Ordinary shares - $1.00 par value (class A and B), 21,206,630 shares authorized, 13,575,809 shares issued, 12,354,599 shares outstanding, actual; shares authorized and shares issued and outstanding, pro forma and pro forma as adjusted	13,576
Ordinary shares - no par value (class C, D, E, F and G), 3,566,169 shares authorized, 2,416,784 shares issued and outstanding, actual; shares authorized and shares issued and outstanding, pro forma and pro forma as adjusted	29,449
Common shares - no par value, 84,050,000 shares authorized, zero shares issued and outstanding, actual; 84,050,000 shares authorized and 14,771,383 shares issued and outstanding, pro forma; shares authorized and shares issued and outstanding, pro forma as adjusted ⁽²⁾	—
Additional paid-in-capital	29,017
Treasury shares, at cost, 1,221,210 shares held	(6,465		)
Accumulated deficit	(74,407		)
Accumulated other comprehensive income	70
Total shareholders’ equity (deficit)	(8,760		)
Total capitalization	$	16,142

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(1)

Each $1.00 increase (decrease) in the assumed initial public offering price of $ per common share, the midpoint of the price range set forth on the cover page of this prospectus, would increase (decrease) each of our pro forma as adjusted cash, additional paid-in capital, total shareholders’ equity (deficit) and total capitalization by approximately $ million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting discounts and commissions and estimated offering expenses payable by us. Each increase (decrease) of 1,000,000 shares in the number of shares offered by us as set forth on the cover page of this prospectus, would increase (decrease) each of our pro forma as adjusted cash, additional paid-in capital, total shareholders’ equity (deficit) and total capitalization by approximately $ , assuming that the assumed initial public offering price of $ per common share, the midpoint of the price range set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. The pro forma as adjusted information set forth in the table above is illustrative only and will be adjusted based on the actual initial public offering price, number of shares offered and other terms of this offering determined at pricing.


(2)	The Common Shares currently have a par value of $1.00. We intend to amend our memorandum and articles of association such that prior to the effectiveness of this registration statement, the Common Shares shall have no par value.

The number of common shares to be outstanding after this offering is based on 14,771,383 shares outstanding as of March 31, 2018 and excludes:


▪	983,739 common shares issuable upon the exercise of share options outstanding as of March 31, 2018 granted under our 2015 Equity Incentive Plan with a weighted-average exercise price of $6.74 per share;


▪	145,000 common shares issuable upon the exercise of warrants outstanding as of March 31, 2018 with an exercise price of $3.80 per share;


▪	433,031 common shares issuable upon the vesting of restricted stock awards outstanding as of March 31, 2018, under our 2015 Equity Plan;


▪	625,000 Class G-1 ordinary shares issued to RTW Investments’ affiliated entities and 285,559 Class G ordinary shares issued to several investors after March 31, 2018;


▪	up to 100,000 common shares reserved for issuance in connection with acquisition-related obligations; and

▪

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DILUTION

If you invest in our common shares, your interest will be diluted to the extent of the difference between the amount per share paid by purchasers of common shares in this initial public offering and the pro forma as adjusted net tangible book value per common share immediately after this offering.

As of March 31, 2018 , our pro forma net tangible book value was approximately $ million, or $ per common share. Our pro forma net tangible book value per common share represents the amount of our total tangible assets reduced by the amount of our total liabilities and divided by the total number of common shares outstanding as of March 31, 2018 , after giving effect to the conversion of our issued and outstanding ordinary shares into an aggregate of 14,771,383 common shares immediately prior to the completion of this offering .

After giving effect to (i) the sale by us of common shares in this offering at an assumed initial public offering price of $ per common share, which is the midpoint of the price range set forth on the cover page of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us, and (ii) the repayment of $5.0 million of promissory notes held by former Class Z preferred shareholders, which repayment will occur in connection with this offering , our pro forma as adjusted net tangible book value as of March 31, 2018 would have been $ million, or $ per common share. This represents an immediate increase in pro forma as adjusted net tangible book value of $ per common share to our existing shareholders and an immediate dilution of $ per common share to investors purchasing shares in this offering.

The following table illustrates this dilution:




Assumed initial public offering price per common share		$
Pro forma net tangible book value per common share as of March 31, 2018	$
Increase in pro forma as adjusted net tangible book value per common share attributable to new investors in this offering
Pro forma net tangible book value per common share, as adjusted to give effect to this offering
Dilution per common share to new investors in this offering		$

The dilution information discussed above is illustrative only and will be adjusted based on the actual initial public offering price, the number of shares offered and other terms of this offering determined at pricing. Each $1.00 increase (decrease) in the assumed initial public offering price of $ per common share, the midpoint of the price range set forth on the cover page of this prospectus, would increase (decrease) our pro forma net tangible book value, as adjusted to give effect to this offering, by $ per common share, the increase (decrease) attributable to this offering by $ per common share, and the dilution in pro forma as adjusted net tangible book value per share to new investors in this offering by $ per common share, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions payable by us. Each increase (decrease) of 1,000,000 shares in the number of shares offered by us as set forth on the cover page of this prospectus would increase (decrease) our pro forma net tangible book value, as adjusted to give effect to this offering, by $ per common share, the increase (decrease) attributable to this offering by $ per common share, and the dilution in pro forma as adjusted net tangible book value per share to new investors in this offering by $ per common share, assuming that the assumed initial public offering price of $ per common share, the midpoint of the price range set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

If the underwriters exercise their option to purchase additional shares in full, the pro forma net tangible book value per common share after giving effect to this offering would be $ per common share, and the dilution in net tangible book value per common share to investors in this offering would be $ per common share.

The following table summarizes, as of March 31, 2018 on the pro forma as adjusted basis described above, the differences between the number of shares purchased from us, the total consideration paid to us in cash and the average price per share that existing stockholders and investors in this offering paid for such shares. The calculation below is

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based on the initial public offering price of $ per share, before deducting the underwriting discounts and commissions and estimated offering expenses payable by us.




	Shares Purchased		Total Consideration		Average Price Per Share
	Number	Percent	Amount	Percent	Average Price Per Share
Existing Shareholders		%	$	%	$
New Investors
Total		%	$	%	$

Each $1.00 increase (decrease) in the assumed initial public offering price of $ per common share, the midpoint of the price range set forth on the cover page of this prospectus, would increase (decrease) total consideration paid by new investors by approximately $ million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and increase (decrease) the percent of total consideration paid by new investors by %, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same. Each increase (decrease) of 1,000,000 shares in the number of shares offered by us as set forth on the cover page of this prospectus would increase (decrease) total consideration paid by new investors by approximately $ million, assuming that the assumed initial public offering price of $ per common share, the midpoint of the price range set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us, and increase (decrease) the percent of total consideration paid by new investors by %, assuming that the assumed initial public offering price of $ per common share, the midpoint of the price range set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

Except as otherwise indicated, the above discussion and tables assume no exercise of the underwriters’ option to purchase additional shares. After giving effect to the sale of shares in the offering by us, if the underwriters exercise their option to purchase additional shares in full, our existing shareholders would own % and new investors would own % of the total number of common shares outstanding upon the completion of this offering.

The number of common shares to be outstanding after this offering is based on 14,771,383 shares outstanding as of March 31, 2018 and excludes:


▪	983,739 common shares issuable upon the exercise of share options outstanding as of March 31, 2018 granted under our 2015 Equity Incentive Plan with a weighted-average exercise price of $6.74 per share;


▪	145,000 common shares issuable upon the exercise of warrants outstanding as of March 31, 2018 with an exercise price of $3.80 per share;


▪	433,031 common shares issuable upon the vesting of restricted stock awards outstanding as of March 31, 2018, under our 2015 Equity Plan;


▪	625,000 Class G-1 ordinary shares issued to RTW Investments’ affiliated entities and 285,559 Class G ordinary shares issued to several investors after March 31, 2018;


▪	up to 100,000 common shares reserved for issuance in connection with acquisition-related obligations; and

▪

To the extent that any outstanding options or warrants are exercised, or new options or warrants are issued, there will be further dilution to investors participating in this offering.

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SELECTED CONSOLIDATED FINANCIAL DATA

The following selected consolidated financial data should be read together with our consolidated financial statements and related notes and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and, which are included elsewhere in this prospectus. We have derived the consolidated statements of operations data for the years ended December 31, 2016 and 2017 and the consolidated balance sheet data as of December 31, 2017 from our audited consolidated financial statements included elsewhere in this prospectus. We have derived the consolidated statements of operations data for the year ended December 31, 2015 from our audited consolidated financial statements not included in this prospectus. We have derived the consolidated statements of operations data for the three months ended March 31, 2017 and 2018 and the balance sheet data as of March 31, 2018 from our unaudited condensed consolidated interim financial statements included elsewhere in this prospectus. Our historical results presented below are not necessarily indicative of financial results to be achieved in future periods.




	Years Ended December 31,									Three Months Ended March 31,
	2015			2016			2017			2017			2018
										(unaudited)
	(in thousands, except share and per share data)
Consolidated Statements of Operations Data:
Revenue	$	9,594		$	19,801		$	34,681		$	6,919		$	14,816
Cost of revenue	4,623			9,705			16,979			3,509			6,901
Gross profit	4,971			10,096			17,702			3,410			7,915
Operating expenses:
Sales, general and administrative	4,727			23,189			30,821			5,849			8,648
Research and development	604			2,740			6,864			1,503			2,147
Total operating expenses	5,331			25,929			37,685			7,352			10,795
Loss from operations	(360		)	(15,833		)	(19,983		)	(3,942		)	(2,880		)
Interest expense	(955		)	(3,413		)	(10,420		)	(927		)	(2,171		)
Change in fair value of derivative instruments	(182		)	(2,484		)	(2,428		)	(286		)	(1,305		)
Other income (expense), net	(97		)	(295		)	(1,961		)	161			(164		)
Loss before income taxes	(1,594		)	(22,025		)	(34,792		)	(4,994		)	(6,520		)
Provision for income taxes	—			(134		)	(105		)	(5		)	(10		)
Net loss	(1,594		)	(22,159		)	(34,897		)	(4,999		)	(6,530		)
Cumulative dividend relating to ordinary shares	(171		)	—			—			—			—
Dividend relating to ordinary shares	(623		)	—			—			—			—
Net loss attributable to ordinary shareholders	$	(2,388	)	$	(22,159	)	$	(34,897	)	$	(4,999	)	$	(6,530	)

Basic and diluted net loss per share attributable to non-participating ordinary shareholders	$	(0.54	)	$	(3.42	)	$	(3.41	)	$	(0.75	)	$	(0.45	)
Basic and diluted net loss per share attributable to participating ordinary shareholders	$	(0.81	)	$	—		$	—		$	—		$	—
Weighted average outstanding non-participating ordinary shares used for net loss per share attributable to ordinary shareholders	4,413,194			6,482,249			10,230,586			6,633,635			14,662,092
Weighted average outstanding participating ordinary shares used for net loss per share attributable to ordinary shareholders	2,173,663			—			—			—			—


(1)	See Note 13 to our consolidated financial statements and Note 12 to our condensed unaudited interim financial statements included elsewhere in this prospectus for an explanation of the method used to calculate net loss per share, basic and diluted, and the number of shares used in the computation of the per share amounts.

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	As of December 31,						As of March 31,
	2016			2017			2018
							(unaudited)
	(in thousands)
Consolidated Balance Sheet Data:
Cash	$	479		$	10,864		$	6,613
Working capital (deficit)	(42,052		)	(18,053		)	20,678
Total assets	29,562			57,095			59,016
Long-term debt, net of debt discount and issuance costs	—			—			19,908
Other liabilities, long term	1,425			4,673			26,970
Total liabilities	55,997			62,108			67,776
Total shareholders’ equity (deficit)	(26,435		)	(5,013		)	(8,760		)

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the section titled “Selected Consolidated Financial Data” and the consolidated financial statements and related notes thereto included elsewhere in this prospectus. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in the section titled “Risk Factors” included elsewhere in this prospectus.

Overview

We have devoted a majority of our resources since inception to developing our Motiva Implants, which we began selling in October 2010. We have incurred net losses in each year since inception, and we have financed our operations primarily through private equity financings and debt financings. Our revenue for the years ended December 31, 2016 and 2017 was $19.8 million and $34.7 million , respectively, an increase of $14.9 million , or 75% . Net losses increased from $22.2 million for the year ended December 31, 2016 to $34.9 million for the year ended December 31, 2017 . As of December 31, 2017 , we had an accumulated deficit of $67.9 million .

Our cash balance as of March 31, 2018 was $6.6 million . In multiple closings between April and June 2018, we issued an aggregate of $4.6 million of Class G ordinary shares at a purchase price of $16.00 per share to several investors. On May 17, 2018, we issued 625,000 shares of Class G-1 ordinary shares at a purchase price of $16.00 per share to entities affiliated with RTW Investments for an aggregate purchase price of $10.0 million.

We have made and continue to make significant investments in additional manufacturing capacity, marketing, customer service, and a direct sales force in certain territories like Brazil and several countries in Europe in order to drive and support further adoption of our Motiva Implants. We also intend to continue to make significant investments to conduct our PMA clinical trial in the United States, with the goal of obtaining FDA approval and commercializing our Motiva Implants in the United States, continue research and development of new and existing products and on programs to educate physicians about the benefits of our products. We also expect to incur significant additional expenditures as a public company.

As a result of these and other factors, we expect to continue to incur net losses in the intermediate term and may need to raise additional capital through equity and debt financings in order to fund our operations. Our operating results may fluctuate on a quarterly or annual basis in the future, and our growth or operating results may not be consistent with predictions made by securities analysts, if any. If we are unable to achieve our revenue growth objectives, we may not be able to achieve profitability.

We will continue to incur losses at least in the near term as we expand our organization to support planned sales growth, while also continuing to invest in research and development of our products, clinical trials to enable regulatory approval in the United States, and other commercialization efforts.

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Components of Results of Operations

Revenue

We commenced sales of our Motiva Implants in October 2010 and these products have historically accounted for the majority of our revenues. Sales of our Motiva Implants accounted for over 85% of our revenues for the years ended December 31, 2016 and 2017, and we expect our revenues to continue to be driven primarily by sales of these products. We primarily derive revenue from sales of our Motiva Implants to two types of customers: (1) medical distributors and (2) direct sales to physicians, hospitals, and clinics.

We recognize revenue related to the sales of products at the time of shipment, except for a portion of our direct sales revenue that is generated from the sale of consigned inventory maintained at physician, hospital, and clinic locations. For consignment sales, revenue is recognized at the time we are notified by the customer that the product has been implanted. Our contracts with distributors do not typically contain right of return or price protection and have no post-delivery obligations.

We expect our revenue to increase as we enter new markets, expand awareness of our products in existing markets, and grow our distributor network and direct sales force. We also expect our revenue to fluctuate from quarter to quarter due to a variety of factors, including seasonal fluctuations in demand for Motiva Implants. We are also affected by foreign currency fluctuations, however, to date, the net impact of foreign currency translation has been insignificant.

Cost of Revenue and Gross Margin

Our implants are manufactured at our two facilities in Costa Rica, one of which opened in 2017. Cost of revenue is primarily the cost of silicone but also includes other raw materials, packaging, components, quality assurance, labor costs, as well as manufacturing and overhead expenses. Cost of revenue also includes depreciation expense for production equipment, and amortization of certain intangible assets.

We calculate gross margin as revenue less cost of revenue for a given period divided by revenues . Our gross margin may fluctuate from period to period depending, in part, on the efficiency and utilization of our manufacturing facilities, targeted pricing programs, and sales volume based on geography, customer and product type.

Operating Expenses

Sales, General and Administrative

Sales, general and administrative, or SG&A, expenses primarily consist of compensation, including salary, share-based compensation and employee benefits for our sales and marketing personnel, and for administrative personnel that support our general operations such as information technology, executive management, financial accounting, customer service, and human resources personnel. SG&A expenses also includes costs attributable to marketing, sales support, travel, legal services, financial audit fees, insurance costs, and consulting services. We expect to incur additional SG&A expenses in connection with our becoming a public company, which may increase further when we are no longer able to rely on the “emerging growth company” exemption we are afforded under the JOBS Act.

We expect our SG&A expenses to continue to increase in absolute dollars for the foreseeable future as our business grows and we continue to invest in our sales, marketing, medical education, training and general administration resources to build our corporate infrastructure. However, we expect our SG&A expenses to decrease as a percentage of our revenue over the long term, although our SG&A expenses may fluctuate from period to period due to the timing of expenses related to our sales and marketing campaigns.

Research and Development

Our research and development, or R&D, activities primarily consist of engineering and research programs associated with our products under development, as well as R&D activities associated with our clinical development activities. Our R&D expenses primarily consist of compensation, including salary, share-based compensation and employee benefits for our R&D and clinical personnel. We also incur significant expenses for supplies, development prototypes, design and testing, clinical study costs and product regulatory and consulting expenses.

We expect our R&D expenses to continue to increase in absolute dollars and as a percentage of revenue for the foreseeable future as we continue to advance our products under development, as well as initiate and prepare for additional clinical studies. We received IDE approval from the FDA in March 2018 to initiate a clinical trial and enrolled the first patient during the first half of 2018. We estimate that total costs for this PMA clinical trial will be between $ million and $ million. We also have other products under development for which we may be required to conduct clinical trials in future periods in order to receive regulatory approval to market these products.

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Interest Expense

Interest expense consists primarily of cash and non-cash interest related to outstanding debt and amortization of debt discounts. As of March 31, 2018 , we had $45.0 million in outstanding principal and accrued interest.

Change in Fair Value of Derivative Instruments

Change in fair value of derivative instruments consists of changes in the fair value of our share warrants and put and call option liabilities, and fair value of our liability to issue shares.

Other Income (Expense), Net

Other income (expense), net consists of bank charges, interest income, other non-operating income (expense) and income tax provision.

Consolidated Results of Operations

The following tables set forth our results of operations for the periods presented, in dollars:




	Years Ended December 31,						Three Months Ended March 31,
	2016			2017			2017			2018
							(unaudited)
	(in thousands)
Revenue	$	19,801		$	34,681		$	6,919		$	14,816
Cost of revenue	9,705			16,979			3,509			6,901
Gross profit	10,096			17,702			3,410			7,915
Operating expenses:
Sales, general and administrative	23,189			30,821			5,849			8,648
Research and development	2,740			6,864			1,503			2,147
Total operating expenses	25,929			37,685			7,352			10,795
Loss from operations	(15,833		)	(19,983		)	(3,942		)	(2,880		)
Interest expense	(3,413		)	(10,420		)	(927		)	(2,171		)
Change in fair value of derivative instruments	(2,484		)	(2,428		)	(286		)	(1,305		)
Other income (expense), net	(295		)	(1,961		)	161			(164		)
Loss before income taxes	(22,025		)	(34,792		)	(4,994		)	(6,520		)
Provision for income taxes	(134		)	(105		)	(5		)	(10		)
Net loss	$	(22,159	)	$	(34,897	)	$	(4,999	)	$	(6,530	)

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Comparison of the Years Ended December 31, 2016 and 2017




	Years Ended December 31,
	2016			2017
	(in thousands)
Revenue	$	19,801		$	34,681
Cost of revenue	9,705			16,979
Gross profit	$	10,096		$	17,702
Gross margin	51		%	51		%

Revenue

Revenue increased $14.9 million , or 75% , to $34.7 million for the year ended December 31, 2017 as compared to $19.8 million for the year ended December 31, 2016 . The increase was primarily due to increased sales of Motiva Implants, with the increase driven by greater market penetration in existing geographies and commencement of sales in new geographies.

As of December 31, 2017, our sales organization included 46 employees and contractors, as compared to 8 employees as of December 31, 2016. The increase is primarily attributed to the start of the Brazil commercial operations.

Cost of Revenue and Gross Margin

Cost of revenue increased $7.3 million , or 75% , to $17.0 million for the year ended December 31, 2017 compared to $9.7 million for the year ended December 31, 2016 . The increase was due to higher sales volume of Motiva Implants.

The gross margin for the years ended December 31, 2016 and 2017 has remained consistent at 51% for both periods.

Operating Expenses




	Years Ended December 31,
	2016		2017
	(in thousands)
Operating expenses:
Sales, general and administrative	$	23,189	$	30,821
Research and development	2,740		6,864
Total operating expenses	$	25,929	$	37,685

Sales, General and Administrative Expense

SG&A expense increased $7.6 million , or 33% , to $30.8 million for the year ended December 31, 2017 , compared to $23.2 million for the year ended December 31, 2016 . These SG&A increases were, in part, related to our operations in Brazil which saw an increase in sales commissions and personnel costs of $1.8 million, and an increase in operating expenses of $1.9 million. Outside of Brazil, SG&A expenses increased $4.0 million in sales commissions and personnel costs as a result of the hiring of additional sales and administrative employees, offset by a decrease of $2.0 million in professional services costs. SG&A also increased due to an increase in rent expense of $0.5 million, an increase in depreciation and amortization of $0.7 million primarily related to our new facility in Costa Rica, and an increase in insurance costs of $0.5 million.

Research and Development Expense

R&D expense increased $4.1 million , or 151% , to $6.9 million for the year ended December 31, 2017 , compared to $2.7 million for the year ended December 31, 2016 . The increase in R&D expenses consisted primarily of $1.3 million

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share-based compensation expense, $2.3 million for outside consulting and advisory expenses, and $0.3 million related to the initiation of our PMA clinical study in the United States.

Interest Expense

Interest expense for the year ended December 31, 2017 was $10.4 million as compared to $3.4 million for the year ended December 31, 2016 . The increase in interest expense is primarily due to the extinguishment of outstanding debt with Perceptive and conversion of debt with CPH in August 2017, and interest related to outstanding debt and amortization of debt discounts on our Madryn Credit Agreement, which we entered into in August 2017.

Change in Fair Value of Derivative Instruments

Change in fair value of derivative instruments for the year ended December 31, 2017 was expense of $2.4 million as compared with $2.5 million for the year ended December 31, 2016 . The increase in change in fair value of derivative instruments is primarily due to changes in the fair value of Madryn derivatives embedded in the credit agreement we entered into in August 2017 and changes in our share warrant liability for warrants issued to CPH and to Perceptive in connection with the respective debt arrangements.

Comparison of the Three Months Ended March 31, 2017 and 2018




	Three Months Ended March 31,
	2017			2018
	(unaudited) (in thousands)
Revenue	$	6,919		$	14,816
Cost of revenue	3,509			6,901
Gross profit	$	3,410		$	7,915
Gross margin	49		%	53		%

Revenue

Revenue increased $7.9 million , or 114% , to $14.8 million for the three months ended March 31, 2018 as compared to $6.9 million for the three months ended March 31, 2017 . The increase was primarily due to increased sales of Motiva Implants, with the increase driven by greater market penetration in existing geographies and commencement of sales in new geographies including Brazil where we started generating revenue during the third quarter of fiscal 2017.

Cost of Revenue and Gross Margin

Cost of revenue increased $3.4 million , or 97% , to $6.9 million for the three months ended March 31, 2018 compared to $3.5 million for the three months ended March 31, 2017 . The increase was due to higher sales volume of Motiva Implants.

The gross margin increased to 53% for the three months ended March 31, 2018 compared to 49% for the three months ended March 31, 2017 due to an increase in production volume that spread our fixed manufacturing costs over a larger number of units.

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Operating Expenses




	Three Months Ended March 31,
	2017		2018
	(unaudited) (in thousands)
Operating expenses:
Sales, general and administrative	$	5,849	$	8,648
Research and development	1,503		2,147
Total operating expenses	$	7,352	$	10,795

Sales, General and Administrative Expense

SG&A expense increased $2.8 million , or 48% , to $8.6 million for the three months ended March 31, 2018 , compared to $5.8 million for the three months ended March 31, 2017 . These SG&A increases were, in part, related to our operations in Brazil which saw an increase of $1.4 million primarily related to sales commissions, personnel costs and operating expenses. Outside of Brazil, SG&A expenses increased by $0.5 million due to increase in consulting and audit fees and by $0.8 million due to increase in personnel costs as a result of the hiring of additional sales and administrative employees.

Research and Development Expense

R&D expense increased $0.6 million , or 43% , to $2.1 million for the three months ended March 31, 2018 , compared to $1.5 million for the three months ended March 31, 2017 . The increase in R&D expenses consisted primarily to the initiation of our PMA clinical study in the United States.

Interest Expense

Interest expense increased $1.2 million , or 134% , to $2.2 million for the three months ended March 31, 2018 as compared to $0.9 million for the three months ended March 31, 2017 . The increase in interest expense is primarily due to interest related to outstanding debt and amortization of debt discounts on our Madryn Credit Agreement, which we entered into in August 2017.

Change in Fair Value of Derivative Instruments

Change in fair value of derivative instruments for the three months ended March 31, 2018 was expense of $1.3 million as compared to an expense of $0.3 million for the three months ended March 31, 2017 . The increase in change in fair value of derivative instruments in fiscal 2018 was primarily due to changes in the fair value of Madryn derivatives embedded in the credit agreement we entered into in August 2017 while the change in fair value of derivative instruments in fiscal 2017 primarily related to changes in our share warrant liability for warrants issued to CPH and to Perceptive in connection with the respective debt arrangements.

Liquidity and Capital Resources

As of March 31, 2018 , we had an accumulated deficit of $74.4 million . Since our inception, we have generated losses and expect to continue to generate losses in the intermediate term. We have financed our operations through a combination of private equity financings and debt financings, and from cash generated from operations, primarily from the collection of accounts receivable resulting from sales. Our historical cash outflows have primarily been associated with cash used for operating activities such as expansion of our sales and marketing and distributor infrastructure, investing in inventory, R&D activities, asset acquisitions, capital improvements and other working capital needs. As of December 31, 2017 and March 31, 2018 , we had cash of $10.9 million and $6.6 million , respectively.

In 2017, we raised capital through a series of equity financing rounds with total gross aggregate proceeds of $27.8 million. Through debt funding we received $38.5 million through the Madryn Credit Agreement, in which we used $15.0 million to pay off the Perceptive debt. During the three months ended March 31, 2018 , the Company received $2.0 million from the issuance of Class G ordinary shares and exercise of stock options. Subsequent to March 31, 2018 , the Company received $14.6 million from the issuance of Class G and G-1 ordinary shares.

We believe that our available cash, cash from operations, and the net proceeds from this initial public offering will be sufficient to satisfy our liquidity requirements for at least the next twelve months from the date of the issuance of the

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financial statements. Our liquidity assumptions may prove to be incorrect, and we could utilize our available financial resources sooner than we currently expect. Our future capital requirements will depend on many factors, including:


▪	the degree and rate of market adoption of our products;


▪	the cost and timing of our regulatory activities, especially the PMA clinical trial to obtain regulatory approval for our Motiva Implants in the United States;


▪	the emergence of new competing technologies and products;


▪	the costs of R&D activities we undertake to develop and expand our products;


▪	the costs of commercialization activities, including sales, marketing and manufacturing;


▪	the level of working capital required to support our growth; and


▪	our need for additional personnel, information technology or other operating infrastructure to support our growth and operations as a public company.

We may need to raise additional capital to execute our business plan. If we are unable to raise additional capital when desired, or on terms acceptable to us, our business, results of operations, and financial condition would be adversely affected.

Cash Flows

The following table sets forth the primary sources and uses of cash for each of the periods presented below:




	Years Ended December 31,						Three Months Ended March 31,
	2016			2017			2017			2018
							(unaudited)
	(in thousands)
Net cash provided by (used in):
Operating activities	$	(14,266	)	$	(31,970	)	$	(6,604	)	$	(5,931	)
Investing activities	(10,756		)	(845		)	(730		)	(414		)
Financing activities	20,211			42,993			15,224			1,982
Effect of exchange rate changes on cash	—			207			(15		)	112
Net increase (decrease) in cash	$	(4,811	)	$	10,385		$	7,875		$	(4,251	)

Net Cash Provided by (Used in) Operating Activities

Net cash used in operating activities of $ 14.3 million for the year ended December 31, 2016 was comprised of net loss of $22.2 million , partially offset by $0.6 million of non-cash depreciation expense, $2.6 million change in fair value of financial instruments, $3.1 million of share-based compensation expense, and $3.1 million of non-cash interest expense due to accretion of debt discounts, as well as changes in operating assets and liabilities of $1.8 million .

Net cash used in operating activities of $32.0 million for the year ended December 31, 2017 was comprised of a net loss of $34.9 million , partially offset by non-cash expenses of $1.9 million of depreciation and amortization, $2.4 million change in fair value of financial instruments, $3.3 million of share-based compensation expense, and $7.1 million of interest expense due to accretion of debt discounts, as well as changes in operating assets and liabilities of $14.3 million , primarily driven by an increase in inventory of $6.4 million.

Net cash used in operating activities of $6.6 million for the three months ended March 31, 2017 was comprised of net loss of $5.0 million , partially offset by $0.3 million of non-cash depreciation expense, $0.3 million change in fair value of financial instruments, $1.1 million of share-based compensation expense, and $0.6 million of non-cash interest expense due to accretion of debt discounts, as well as changes in operating assets and liabilities of $4.1 million .

Net cash used in operating activities of $5.9 million for the three months ended March 31, 2018 was comprised of net loss of $6.5 million , partially offset by $0.6 million of non-cash depreciation expense, $1.3 million change in fair value of financial instruments, $0.7 million of share-based compensation expense, and $0.8 million of non-cash interest expense due to accretion of debt discounts, as well as changes in operating assets and liabilities of $3.3 million .

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Net Cash Provided by (Used in) Investing Activities

Net cash used in investing activities of $ 10.8 million for the year ended December 31, 2016 reflected $10.5 million in purchases of property and equipment primarily related to our second manufacturing facility and $0.1 million paid for business acquisitions.

Net cash used in investing activities of $ 0.8 million for the year ended December 31, 2017 primarily consisted of $0.9 million in purchases of property and equipment partially offset by changes in restricted cash of $0.1 million .

Net cash used in investing activities of $0.7 million for the three months ended March 31, 2017 primarily consisted of $0.8 million in purchases of property and equipment partially offset by changes in restricted cash of $0.1 million .

Net cash used in investing activities of $0.4 million for the three months ended March 31, 2018 primarily consisted of $0.4 million in purchases of property and equipment.

Net Cash Provided by (Used in) Financing Activities

Net cash provided by financing activities of $ 20.2 million for the year ended December 31, 2016 primarily reflected $9.2 million in convertible notes borrowing, net of debt issuance costs, under the CPH note agreement, and $14.4 million borrowings from Perceptive debt agreement, net of debt issuance costs and $1.5 million in short term notes borrowings offset by $2.0 million in payment for repurchase of treasury shares, $1.5 million in repayment of short term notes and $1.0 million for the settlement of our Magna put option liability.

Net cash provided by financing activities of $43.0 million for the year ended December 31, 2017 primarily reflected $38.5 million in borrowing, net of debt issuance costs, under the Madryn Credit Agreement and $27.8 million in proceeds received for issuance of ordinary shares partially offset by $15.0 million in repayment of Perceptive debt, $4.5 million in payment for repurchase of treasury shares, and $2.4 million in payment for repurchase of share warrants.

Net cash provided by financing activities of $15.2 million for the three months ended March 31, 2017 primarily reflected $14.7 million in proceeds received for issuance of ordinary shares and $1.0 million in proceeds received from a short-term note payable partially offset by $0.2 million in repayment of short-term notes payable and $0.3 million in payment of deferred offering costs.

Net cash provided by financing activities of $2.0 million for the three months ended March 31, 2018 primarily reflected $1.6 million in proceeds received for issuance of ordinary shares and $0.4 million from stock option exercises.

Indebtedness

Notes Payable Related Party

In August 2015, we entered into agreements with all of the Class Z redeemable convertible preferred shareholders to exchange their outstanding shares and accumulated dividends for notes payable with a principal balance of $4.3 million. The notes bear interest at a simple rate of 7% per annum with a maturity date of March 31, 2020. Annual payments are due based on achievement of certain annual sales milestones beginning in March 2017, which are accelerated upon the effectiveness of an initial public offering . During fiscal years 2016 and 2017 , we recorded non-cash interest expense of $0.3 million annually, to accrue for interest due on the notes. As of March 31, 2018 the balance of principal and accrued interest for the notes payable related party was $4.9 million .

Madryn Debt

On August 24, 2017, we entered into a credit agreement, or the Madryn Credit Agreement, with Madryn Health Partners, LP, or Madryn, as administrative agent, and a syndicate of lenders, or the Lenders. The Madryn Credit Agreement provides for up to $55.0 million credit facility, $30.0 million (Term A) of which became available upon signing. The Madryn Credit Agreement matures on June 30, 2023.

Terms B and C under the Madryn Credit Agreement become available to us for an additional $25.0 million, subject to us achieving certain revenue milestones. We met these milestones and borrowed an additional $5.0 million (Term B-1) on October 31, 2017 and $5.0 million (Term B-2) on December 15, 2017 bringing up the total outstanding principal balance to $40.0 million as of December 31, 2017. As of June 15, 2018, we were eligible to draw down an additional $5.0 million (Term B-3) under the amended Credit Agreement, and an additional $10.0 million (Term C) may become available on June 30, 2020 if the required milestones for this tranche are achieved.

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annum. No principal payments are due until 2021. Eight quarterly payments of 12.5% of the principal amounts borrowed under each tranche are due beginning September 30, 2021 through June 30, 2023.

The Madryn Credit Agreement contains put options related to liquidity events or an event of default and a call option related to voluntary repayment option. We valued these put options and the call option, and allocated a fair value of $15.1 million for these identified embedded derivatives as a debt discount on the original commitment date in August 2017. An additional $5.0 million debt discount was recorded on respective borrowing dates when we met the required milestones and borrowed an additional $10.0 million in the fourth quarter of fiscal 2017. We revalue the options as of each reporting period, and record the change in the fair value in the consolidated statement of operations as other income or expense. We also incurred legal expenses of $1.3 million , which were recorded as a debt discount and are being amortized over the term of the Madryn Credit Agreement.

The Madryn Credit Agreement contains customary affirmative and negative covenants, including, but not limited to, restrictions on the ability to incur additional indebtedness, create liens, make certain investments, make restricted payments, enter into or undertake certain liquidations, mergers, consolidations or acquisitions and dispose of assets or subsidiaries. In addition, the Madryn Credit Agreement requires us to maintain minimum revenues and liquidity.

We defaulted on the Madryn Credit Agreement on February 28, 2018 when our investment in our Brazilian subsidiary exceeded the allowable $5.0 million threshold permitted under the Madryn Credit Agreement. As a result, we entered into a forbearance agreement with the Lenders, where the Lenders agreed to forebear from exercising certain rights and remedies through May 18, 2018 and subsequently through July 3, 2018 arising from certain disclosure and other technical defaults under the Madryn Credit Agreement, including those mentioned above with respect our Brazilian subsidiary. Accordingly, as the forbearance agreement did not cover a period exceeding twelve months after the date of the annual financial statements, we recorded the Madryn debt as a current liability on the consolidated balance sheet as of December 31, 2017 (see Note 6). Effective June 15, 2018, Madryn Credit Agreement was amended to remove the restrictive covenants that resulted in the technical defaults which allowed the Company to reclassify the arrangement as long-term as of March 31, 2018.

Contractual Obligations and Commitments

The following table summarizes payments due by period for our contractual commitments and obligations as of December 31, 2017 :




	Total		Less Than 1 Year		1-3 Years		3-5 Years		More Than 5 Years
	(in thousands)
Capital lease obligations	$	1,046	$	335	$	546	$	165	$	—
Madryn debt obligations (principal)	40,000		40,000		—		—		—
Madryn debt obligations (interest) (1)	2,311		2,311		—		—		—
Notes payable related party	4,921		4,921		—		—		—
Purchase commitment	22,278		7,154		10,256		1,650		3,218
Operating lease obligations	5,011		738		1,190		1,534		1,549
Warrant repurchase liability	2,261		—		2,261		—		—
	$	77,828	$	55,459	$	14,253	$	3,349	$	4,767

(1)

In 2017, we entered into a credit agreement, or the Madryn Credit Agreement, with Madryn Health Partners, LP, or Madryn, as administrative agent, and a syndicate of lenders. We initially defaulted on the Madryn Credit Agreement on in January 2018 when we failed to put a Qualifying Control Agreement in place for certain bank deposit accounts and subsequently in February 2018 when our investment in our Brazilian subsidiary exceeded the allowable $5.0 million threshold. See discussion above regarding the forebearance and amendment that were undertaken in connection therewith.

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The following table summarizes our contractual commitments and obligations as of March 31, 2018 :




	Total		Less Than 1 Year		1-3 Years		3-5 Years		More Than 5 Years
	(in thousands)
Capital lease obligations	$	960	$	248	$	546	$	166	$	—
Madryn debt obligations (principal)	40,000		—		—		30,000		10,000
Madryn debt obligations (interest) (1)	22,554		3,893		10,310		7,870		481
Notes payable related party	4,994		4,994		—		—		—
Purchase commitment	20,490		5,366		10,256		1,650		3,218
Operating lease obligations	4,830		557		1,190		1,534		1,549
Warrant repurchase liability	2,261		—		2,261		—		—
	$	96,089	$	15,058	$	24,563	$	41,220	$	15,248


(1)	Effective June 15, 2018, Madryn Credit Agreement was amended to remove the restrictive covenants that resulted in the technical defaults which allowed the Company to reclassify the arrangement as long-term as of March 31, 2018.

Off-Balance Sheet Arrangements

As of December 31, 2017 and March 31, 2018 , we did not have any off-balance sheet arrangements.

JOBS Act Accounting Election

The JOBS Act permits an “emerging growth company” such as us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. We intend to take advantage of certain exemptions from various public company reporting requirements including following private company effective dates for new or revised accounting standards.

Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

We had cash of $10.9 million and $6.6 million as of December 31, 2017 and March 31, 2018 , respectively. We manage our cash portfolio for operating and working capital purposes. Our cash balances are held in bank checking and savings accounts, and we believe that we do not have any material exposure to changes in the fair value of our cash portfolio as a result of changes in interest rates.

Foreign Currency Exchange Risk

To date, the majority of our revenue has been denominated in U.S. dollars. Some of our operating expenses are subject to fluctuations due to changes in foreign currency exchange rates, particularly changes in the euro. Fluctuations in foreign currency exchange rates may cause us to recognize transaction gains and losses in our consolidated statements of operations. To date, foreign currency gains and losses have not been material to our consolidated financial statements, and we have not engaged in any foreign currency hedging activities. As our international operations grow, we will continue to reassess our approach to managing the risks relating to fluctuations in foreign currency exchange rates. During the years ended December 31, 2016 and 2017, the effect of an immediate 10% adverse change in foreign exchange rates on foreign-denominated accounts as of December 31, 2016 and 2017 would have had an impact of approximately 7% on revenues and would have impacted our net loss by a commensurate amount.

Inflation Risk

We do not believe that inflation had a significant impact on our results of operations for any periods presented in our consolidated financial statements.

Critical Accounting Policies, Significant Judgments and Use of Estimates

This discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, revenue and expenses, and the disclosure of contingent assets and liabilities. Our estimates are based on our historical

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experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities. Actual results may differ from these estimates. We believe that the critical accounting policies discussed below are essential to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s estimates and judgments.

Revenue Recognition

We recognize revenue related to sales of products to distributors or directly to customers in markets where we have regulatory approval, net of trade discounts and allowances. We recognize revenue when all of the following criteria are met:

▪ persuasive evidence of an arrangement exists;

▪ the sales price is fixed or determinable;

▪ collection of the relevant receivable is probable at the time of sale; and

▪ delivery has occurred or services have been rendered.

We recognize revenue related to the sales of products to distributors at the time of shipment of the product, which represents the point in time when the customer has taken ownership and assumed the risk of loss and the required revenue recognition criteria are satisfied. Our distributors are obligated to pay within specified terms regardless of when or if they sell the products. Our contracts with distributors do not typically contain rights of return or price protection and have no post-delivery obligations.

Appropriate reserves are established for anticipated sales returns based on historical experience, recent gross sales and any notification of pending returns. The Company recognizes revenue when title to the product and risk of loss transfer to customers, provided there are no remaining performance obligations required of the Company or any written matters requiring customer acceptance. The Company allows for the return of product from direct customers in certain regions within fifteen days after the original sale and records estimated sales returns as a reduction of sales in the same period revenue is recognized. Sales return provisions are calculated based upon historical experience with actual returns. Actual sales returns in any future period are inherently uncertain and thus may differ from the estimates. If actual sales returns differ significantly from the estimates, an adjustment to revenue in the current or subsequent period would be recorded. To date, sales returns have been de minimis. The Company will continue to monitor sales return activity and will record an allowance for sales returns against accounts receivable if deemed material.

A portion of our revenue is generated from the sale of consigned inventory maintained at physician, hospital, and clinic locations. For these products, revenue is recognized at the time we are notified by the customer that the product has been implanted, not when the consigned products are delivered to the customer’s warehouse.

We have a limited warranty to distributors for the shelf life of the product, which is five years from the time of manufacture. Estimated warranty obligations are recorded at the time of sale. We also offer a warranty to patients in the event of rupture and a replacement program for capsular contracture events provided certain registration requirements are met. Revenue for extended warranties are recognized ratably over the term of the agreement. To date, these warranty and program costs have been de minimis. We will continue to evaluate the warranty reserve policies for adequacy considering claims history.

Deferred revenue primarily consists of payments received in advance of meeting revenue recognition criteria. We have received payments from distributors to provide distribution exclusivity within a geographic area, and recognize deferred revenue on a ratable basis over the term of such contractual distribution relationship. Additionally, we have received payments from customers in direct markets prior to surgical implantation, and recognizes deferred revenue at the time we are notified by the customer that the product has been implanted. For all arrangements, any revenue that has been deferred and is expected to be recognized beyond one year is classified as long-term deferred revenue in the consolidated balance sheets.

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation and amortization.

Depreciation of property and equipment is computed using the straight-line method over the assets’ estimated useful lives of five to ten years. Leasehold improvements are amortized on a straight-line basis over the shorter of the estimated useful life of the asset or the remaining lease term after factoring expected renewal periods. Upon retirement or disposal of assets, the costs and related accumulated depreciation are eliminated from the accounts and any gain or loss is recognized in operations. Maintenance and repairs are expensed as incurred. Substantially all of our

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manufacturing operations and related property and equipment is located in Costa Rica.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable is stated at invoice value less estimated allowances for returns and doubtful accounts. We continually monitor customer payments and maintain an allowance for estimated losses resulting from customers’ inability to make required payments. In evaluating our ability to collect outstanding receivable balances, we consider various factors including the age of the balance, the creditworthiness of the customer, which is assessed based on ongoing credit evaluations and payment history, and the customer’s current financial condition. In cases where there are circumstances that may impair a specific customer’s ability to meet its financial obligations, an allowance is recorded against amounts due, which reduces the net recognized receivable to the amount reasonably believed to be collectible. Historical returns of products have been de minimis, and accordingly no allowance for returns was recorded as of December 31, 2017 and March 31, 2018 .

Inventory and Cost of Revenue

Inventory is stated at the lower of cost to purchase or manufacture the inventory or the net realizable value of such inventory. Cost is determined using the standard cost method which approximates actual costs using the first-in, first-out basis. We regularly review inventory quantities in consideration of actual loss experiences, projected future demand, and remaining shelf life to record a provision for excess and slow-moving inventory. No inventory allowance has been recorded as of December 31, 2017 and March 31, 2018 .

We recognize the cost of inventory transferred to the customer in cost of revenue when revenue is recognized.

Goodwill and Intangible Assets

We record the excess of the acquisition purchase price over the net fair value of the tangible and identifiable intangible assets acquired and liabilities assumed as goodwill. In accordance with Accounting Standards Codification, or ASC, 350, Intangibles - Goodwill and Other, we test goodwill for impairment annually during the fourth quarter of each year and whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. In connection with the annual impairment test for goodwill, we elected the option to perform a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If we determine that it was more likely than not that the fair value of the reporting unit is less than its carrying amount, then the impairment test is performed. Consistent with our assessment that it has only one reporting segment, we have determined that it has only one reporting unit and tests goodwill for impairment at the entity level using the two-step process required by ASC 350. In the first step, we compare the carrying amount of the reporting unit to the fair value of the enterprise. If the fair value of the enterprise exceeds the carrying value, goodwill is not considered impaired and no further testing is required. If the carrying value of the enterprise exceeds the fair value, goodwill is potentially impaired and the second step of the impairment test must be performed. In the second step, we compare the implied fair value of the goodwill, as defined by ASC 350, to its carrying amount to determine the impairment loss, if any.

We record purchased intangible assets at their respective estimated fair values at the date of acquisition. Purchased finite-lived intangible assets are being amortized using the straight-line method over their remaining estimated useful lives, which range from two to fifteen years. We evaluate the remaining useful lives of intangible assets on a periodic basis to determine whether events or circumstances warrant a revision to the remaining estimated amortization period. We test indefinite-lived intangible assets for impairment on at least an annual basis and whenever circumstances suggest the assets may be impaired. If indicators of impairment are present, we evaluate the carrying value of the intangible assets in relation to estimates of future undiscounted cash flows. We also evaluate the remaining useful life of an indefinite-lived intangible asset to determine whether events and circumstances continue to support an indefinite useful life.

During the years ended December 31, 2016 and 2017 , there has been no impairment of goodwill or intangible assets. As of March 31, 2018 , no triggering events have occurred which would indicate that the acquired intangible asset values may not be recoverable.

Long-Lived Assets

We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. When such an event occurs, management determines whether there has been impairment by comparing the anticipated undiscounted future net cash flows to the related asset group’s carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. There were no impairment charges, or changes in estimated useful lives recorded d uring the years ended December 31, 2016 and 2017. As of March 31,

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2018 , no triggering events have occurred which would indicate that the acquired intangible asset values may not be recoverable.

Debt and Embedded Derivatives

We apply the accounting standards for derivatives and hedging and for distinguishing liabilities from equity when accounting for hybrid contracts. We account for convertible debt instruments when we have determined that the embedded conversion options should not be bifurcated from their host instruments in accordance with ASC 470-20 Debt with Conversion and Other Options. We record, when necessary, discounts to notes payable for the intrinsic value of conversion and other options embedded in debt instruments as a beneficial conversion option based upon the differences between the fair value of the underlying shares at the commitment date of the note transaction and the effective conversion price embedded in the note.

We use option pricing valuation models to determine the fair value of embedded derivatives and records any change in fair value as a component of other income or expense in the consolidated statements of operations.

Debt Issuance Costs and Debt Discounts

Costs incurred in connection with the issuance of new debt are capitalized. Capitalizable debt issuance costs paid to third parties and debt discounts paid to creditors, net of amortization, are recorded as a reduction to the long-term debt balance on the consolidated balance sheets. Amortization expense on capitalized debt issuance costs and debt discounts related to loans are calculated using the effective interest method over the term of the loan commitment, and is recorded as interest expense in the consolidated statements of operations.

Share Warrant Liability

We have issued freestanding warrants to purchase shares of our ordinary shares in conjunction with certain debt arrangements. Prior to the adoption of ASU 2017-11 I. Accounting for Certain Financial Instruments With Down Round Features and II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests With a Scope Exception , we classified the fair value of these warrants as liabilities due to the existence of certain cash settlement features that were not within our sole control and/or existence of a variable settlement provision that caused these warrants not to be indexed to our own shares. At the end of each reporting period, changes in estimated fair value during the period were recorded in the consolidated statements of operations. We used the Monte-Carlo valuation model to determine the fair value of the warrants.

As a result of the complex valuation models used to determine the fair value of the warrants, the valuation of this derivative instrument is subjective because the models require the input of highly subjective assumptions, including the share price and expected volatility. Changes in these assumptions can materially affect the fair value estimate and, such impacts can, in turn, result in material non-cash charges or credits in the consolidated statements of operations as other income or expense. We will continue to adjust the liability for changes in fair value until the earlier of the expiration of the warrants, the reclassification of the warrants from a liability to equity, or their exercise.

After the adoption of ASU 2017-11, we are no longer required to classify the warrants issued as a liability. As a result, we recorded a reclassification of warrant liability to additional paid-in capital upon the adoption of the new guidance in the second quarter of 2017.

Income Taxes

We record income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in our consolidated financial statements or income tax returns. In estimating future tax consequences, expected future events, enactments or changes in the tax law or rates are considered. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized.

We operate in various tax jurisdictions and are subject to audit by various tax authorities.

We record uncertain tax positions based on a two-step process whereby (1) a determination is made as to whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold we recognize the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. Our policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. Significant judgment is required in the identification of uncertain tax positions and in the estimation of penalties and interest on uncertain tax positions.

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There were no uncertain tax positions in fiscal 2016 and 2017 and for the three months ended March 31, 2018.

Foreign Currency

The financial statements of our foreign subsidiaries whose functional currencies are the local currencies are translated into U.S. dollars for consolidation as follows: assets and liabilities at the exchange rate as of the balance sheet date, stockholders’ equity at the historical rates of exchange, and income and expense amounts at the average exchange rate for the month. Translation adjustments resulting from the translation of the subsidiaries’ accounts are included in “Accumulated other comprehensive income.” Transactions denominated in currencies other than the applicable functional currency are converted to the functional currency at the exchange rate on the transaction date. At period end, monetary assets and liabilities are remeasured to the functional currency using exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are remeasured at historical exchange rates. Gains and losses resulting from foreign currency transactions are included within “Other income (expense), net.”

Comprehensive Income (Loss)

Comprehensive income (loss) represents all changes in the shareholders’ equity (deficit) except those resulting from and distributions to shareholders. Our comprehensive income consists of net loss and foreign currency translation adjustments arising from the consolidation of our foreign subsidiaries.

Deferred Offering Costs

Deferred offering costs, consisting of legal, accounting and other fees and costs relating to our planned initial public offering, or IPO, are capitalized within “Other non-current assets” on the consolidated balance sheet. The deferred offering costs will be offset against the proceeds received upon the closing of the planned IPO. In the event the planned IPO is terminated, all of the deferred offering costs will be expensed within loss from operations. As of December 31, 2016 and 2017, $1.1 million and $0, respectively, of deferred offering costs were capitalized. Due to a delayed IPO process beyond 90 days, we expensed the previously deferred offering costs of $1.6 million during the year ended December 31, 2017.

Share-Based Compensation

We measure and recognize compensation expense for all share-based awards in accordance with the provisions of ASC 718, Stock Compensation . Share-based awards granted include stock options and restricted stock awards, or RSAs. Share-based compensation expense for stock options and RSAs granted to employees is measured at the grant date based on the fair value of the awards and is recognized as an expense ratably on a straight-line basis over the requisite service period. The fair value of options to purchase ordinary shares granted to employees is estimated on the grant date using the Black-Scholes option valuation model.

We account for stock options and RSAs issued to non-employees under ASC 505-50 Equity: Equity-Based Payments to Non-Employees , using the Black-Scholes option valuation model to value stock options. The fair value of such non-employee awards is remeasured at each quarter-end over the vesting period.

The calculation of share-based compensation expense requires that we make assumptions and judgments about the variables used in the Black-Scholes model, including the expected term, expected volatility of the underlying common shares, risk-free interest rate and dividends.

We have adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting , under which we will recognize forfeitures as they occur rather than applying a prospective forfeiture rate in advance

The assumptions used in our option-pricing model represent management’s best estimates. These estimates are complex, involve a number of variables, uncertainties and assumptions and the application of management’s judgment. If factors change and different assumptions are used, our share-based compensation expense could be materially different in the future. The assumptions and estimates that we use in the Black-Scholes model are as follows:

▪

Fair Value of Common Shares . As the ordinary shares are not publicly traded, we must estimate its fair value, as discussed under Common Share Valuations below. The fair value of ordinary shares was determined on a periodic basis by our board of directors, with the assistance of an independent third-party valuation firm. The board of directors intended all options granted to be exercisable at a price per share not less than the estimated per share fair value of the shares underlying those options on the date of grant.


▪	Risk-Free Interest Rate . We base the risk-free interest rate used in the Black-Scholes valuation model on the implied yield available on U.S. Treasury zero-coupon issues with a term equivalent to that of the expected term of the options for each option group.

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▪

Expected Term . The expected term represents the period that our share-based awards are expected to be outstanding. Because of the limitations on the sale or transfer of our shares as a privately held company, we do not believe our historical exercise pattern is indicative of the pattern it will experience as a publicly traded company. We have consequently used the Staff Accounting Bulletin 110, or SAB 110, simplified method to calculate the expected term, which is the average of the contractual term and vesting period. We plan to continue to use the SAB 110 simplified method until it has sufficient trading history as a publicly traded company.

▪

Volatility . We determine the price volatility based on the historical volatilities of industry peers as it has no trading history for its stock. Industry peers consist of several public companies in the medical device industry with comparable characteristics, including revenue growth, operating model and working capital requirements. We intend to continue to consistently apply this process using the same or a similar peer group of public companies until a sufficient amount of historical information regarding the volatility of our shares becomes available, or unless circumstances change such that the identified peer companies are no longer similar, in which case other suitable peer companies whose common share prices are publicly available would be utilized in the calculation.


▪	Dividend Yield . The expected dividend assumption is based on our current expectations about its anticipated dividend policy. We have no expectation t hat we will declare dividends on its ordinary shares, and therefore have used an expected dividend yield of zero.

We will continue to use judgment in evaluating the assumptions related to our share-based compensation on a prospective basis. As we continue to accumulate additional data, we may have refinements to our estimates, which could materially impact our future share-based compensation expense.

Common Share Valuations

The fair value of our common shares for purposes of share-based awards has historically been determined by our board of directors. Because there has been no public market for our common shares, and in the absence of arm’s-length transactions in our common shares with independent third parties, our board of directors has determined the fair value of our common shares with the support of independent third-party valuations prepared in accordance with the guidelines outlined in the American Institute of Certified Public Accountants Practice Aid, Valuation of Privately-Held-Company Equity Securities Issued as Compensation.

In the course of preparing our financial statements, we reassessed the fair value of our common shares on each grant date in light of all available information, including subsequently issued independent third-party valuations and other pertinent factors. In order to assess the fair value of our common shares, our business enterprise value, or BEV, is determined and then allocated to each element of our capital structure (ordinary shares, warrants and options). Our BEV is estimated using the income approach and the market approach. The discounted cash flow method, or DCF, estimates the enterprise value based on the estimated present value of future net cash flows the business is expected to generate over a forecasted period and an estimate of the present value of cash flows beyond that period, which is referred to as terminal value. The estimated present value is calculated using a discount rate known as the weighted average cost of capital, which accounts for the time value of money and the appropriate degree of risks inherent in the business. Under the market approach, the enterprise value is based on the multiples of comparable companies and transactions. The BEV is allocated using probability-weighted expected return method, or PWERM, which estimates the fair value of common shares based on an analysis of future values for the enterprise assuming various future outcomes. In assessing the fair value of our ordinary shares on each grant date, we considered numerous objectives and subjective factors, including, but not limited to, the following:


▪	independent third-party valuations as of June 30, 2017, September 30, 2017, December 31, 2017 and March 31, 2018;


▪	our current and expected operating and financial performance, including our levels of available capital resources;


▪	future revenue, free cash flow, and other capital requirements associated with such revenue;


▪	the discount rate used in the DCF model;


▪	the value of our tangible and intangible assets;


▪	rights and preferences of our ordinary shares;


▪	capital markets conditions affecting comparable public companies, as reflected in comparable companies’ market trading multiples, initial public offering valuations, comparable sales or merger transactions, and other metrics;


▪	the illiquidity of our ordinary shares by virtue of being a private company, and the resulting discount for lack of marketability;

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▪	the business risks we face;


▪	the likelihood of achieving a particular liquidity event, such as a sale, a merger, or an initial public offering, given prevailing medical device industry and capital markets conditions; and


▪	the experience of management and the members of our board of directors.

At March 31, 2018 , unrecognized compensation expense was $1.5 million related to stock options granted to employees and directors and $1.8 million related to stock options granted to consultants. The weighted-average period over which such compensation expense will be recognized is 3.0 years.

As of March 31, 2018 , we had unrecognized share-based compensation cost of approximately $4.4 million associated with unvested restricted stock awards. This cost is expected to be recognized over a weighted-average period of approximately 2.3 years.

Based on upon the assumed initial public offering price of $ per share, the midpoint of the price range set forth on the cover of this prospectus, the aggregate intrinsic value of options outstanding as of March 31, 2018 was $ million.

Following the closing of this offering, the fair value of our common shares will be determined based on the closing price of our common shares on the grant date.

Recent Accounting Standards

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act, or the JOBS Act, enacted in April 2012. We intend to take advantage of certain exemptions from various public company reporting requirements including following private company effective dates for new or revised accounting standards.

The following recent accounting pronouncements issued by the Financial Accounting Standards Board, or the “FASB, could have a material effect on our financial statements:

Recently Adopted Accounting Standards

In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities From Equity (Topic 480); Derivatives And Hedging (Topic 815): (Part I) Accounting For Certain Financial Instruments With Down Round Features, (Part II) Replacement Of The Indefinite Deferral For Mandatorily Redeemable Financial Instruments Of Certain Nonpublic Entities And Certain Mandatorily Redeemable Noncontrolling Interests With A Scope Exception. The standard simplifies the accounting for certain equity-linked financial instruments and embedded features with down round features by no longer requiring entities to consider a down round feature when determining whether a financial instrument is considered indexed to the entity’s own shares and thus can be classified as equity. The guidance must be applied using a full or modified retrospective approach. It is effective for public business entities for annual periods beginning after December 15, 2018, and interim periods therein. Early adoption is permitted for financial statements of fiscal years or interim periods that have not yet been issued or that have not yet been made available for issuance. We adopted the new guidance in July 2017. As a result, certain warrants that were previously classified as a liability due to an existence of down round features became qualified to be classified as equity. The adoption of this standard resulted in $1.0 million reclassification of warrant liability into additional paid in capital as of July 1, 2017.

In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting . This ASU provides amendments to the current guidance on determining which changes to the terms and conditions of share-based payment awards require the application of modification accounting. The effects of a modification should be accounted for unless there are no changes between the fair value, vesting conditions, and classification of the modified award and the original award immediately before the original award is modified. ASU 2017-09 became effective for non-public business entities for annual periods, including interim periods within those annual periods, beginning after December 15, 2017. The adoption of this ASU did not have a material impact on the financial statements.

Recently Issued Accounting Standards

to apply ASU 2014-09 to each prior reporting period presented. The second method would require us to retrospectively apply ASU 2014-09 with the cumulative effect recognized at the date of initial application. ASU 2014-09 is effective for public business entities beginning in fiscal 2018 as a result of ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, ” which was issued by the FASB in August 2015 and extended the original effective date by one year. In 2016, the FASB issued additional updates to the new revenue standard relating to reporting revenue on a gross versus net basis, identifying performance obligations and licensing arrangements, and narrow-scope improvements and practical expedients, respectively. The effective date of this additional update is the same as that of ASU 2014-09. We are currently evaluating the impact of adopting the available methodologies of ASU 2014-09 and the related updated revenue recognition guidance upon its financial statements in future reporting periods. We have not yet selected a transition method. We are in the process of evaluating the new standard against our existing accounting policies, including the timing of revenue recognition, and its contracts with customers to determine the effect the guidance will have on our consolidated financial statements and what changes to systems and controls may be warranted.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than twelve months regardless of their classification. Leases with a term of twelve months or less will be accounted for similar to existing guidance for operating leases today. ASC 842 supersedes the previous leases standard, ASC 840 Leases. The standard is effective for public business entities on January 1, 2019, with early adoption permitted. We are currently evaluating the effects, if any, that the adoption of this guidance will have on our consolidated financial statements.

We have considered all other recently issued accounting pronouncements and do not believe the adoption of such pronouncements will have a material impact on our consolidated financial statements.

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BUSINESS

Overview

Our revenue for 2015, 2016 and 2017 was $9.6 million, $19.8 million and $34.7 million , respectively, an increase of $10.2 million, or 106% in 2016 compared to 2015, and an increase of $14.9 million , or 75% in 2017 compared to 2016 . Net losses increased from $1.6 million in 2015 to $22.2 million in 2016 , and further increased to $34.9 million in 2017 , an increase of 57% compared to 2016. As of December 31, 2017 , we had an accumulated deficit of $67.9 million .

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Our Market Opportunity



Total Breast Augmentation Procedures
Rank *	Country	Procedures	% of World-Wide Total
1	United States	331,122	20.1%
2	Brazil	217,085	13.2%
3	Russia	84,235	5.1%
4	Mexico	62,206	3.8%
5	Italy	54,128	3.3%
6	Germany	52,209	3.2%
7	France	47,510	2.9%
8	Spain	46,493	2.8%
9	Columbia	44,080	2.7%
10	Turkey	38,484	2.3%
* Rankings are based solely on those countries from which a sufficient survey response was received and data were considered to be representative.

Traditional Breast Implants and Their Limitations




	Sientra 5-Year	Allergan 6-Year	Mentor 6-Year
Number of Patients	N=1,788 Patients	N=455 Patients ⁽¹⁾	N=1,008 Patients
Ruptures ⁽²⁾	1.8%	5.5%	3.7%
Capsular Contracture	9.0%	14.8%	13.4%
Reoperations	23.8%	28.0%	26.1%

Each of these prospective studies was conducted at multiple sites in the United States and submitted by each of these companies as their core study supporting approval, as that term is defined in the FDA Guidance on Breast Implants. Sientra, Inc., Mentor Worldwide LLC (a division of Johnson & Johnson), and Allergan plc studies commenced in 2002, 2000, and 1998, respectively, and the results described above were released in 2012, 2009, and 2007, respectively. Five-year and six-year data was chosen to increase comparability to our six-year data.
Kaplan-Meier risk rates were the primary method of analysis for the above data.
(1) Adverse events in the study were derived from the primary augmentation cohort. The overall patient population in the study was 715 patients.
(2) The total for Sientra is based on the total patient population in the study, and the totals for Allergan and Mentor are based on a substudy cohort of patients who underwent an MRI, which is lower than the overall number of patients participating in the study.

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Results from primary augmentations




	Sientra 10-Year	Allergan 10-Year	Mentor 10-Year
Number of Patients	N=1,116 Patients	N=455 Patients	N=552 Patients
Ruptures ⁽¹⁾	8.5%	9.3%	24.2%
Capsular Contracture	12.9%	18.9%	12.1%
Reoperations	24.0%	36.1%	25.5%

Kaplan-Meier risk rates were the primary method of analysis for the above data. This table represents the final data from the primary cohort of the same study referenced in the above five- and six-year PMA studies conducted by our competitors. This 10-year data for Sientra, Allergan and Mentor were released in 2018, 2018, and 2015, respectively.
(1) The rupture rates represent the MRI cohort only for each respective study, which consists of 571 patients for Sientra, 158 patients for Allergan and 202 patients for Mentor.

Our Competitive Strengths


▪	Patient-centric innovative implant technologies. We have developed our Motiva Implants by enhancing and creating novel product components for our implants, and then combining these components into products that deliver improved aesthetic outcomes, increased patient satisfaction and favorable safety profiles.

▪


▪	Dynamic worldwide sales platform. We sell our products both through exclusive arrangements with leading local distributors who have strong local surgeon relationships and our direct sales force in key markets such as Brazil and certain countries in Europe. Using this market specific approach, we have built an effective and efficient worldwide sales platform.


▪	Proven management team with expansive industry experience. We have a highly experienced management team that is comprised of leaders from the medical aesthetic market.

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Our Growth Strategy


▪	Expand revenues in existing markets. We believe we can continue to grow market share in our existing markets due to the favorable safety profile and improved aesthetic outcomes of our Motiva Implants.

▪


▪	Obtain FDA approval and enter the U.S. market. We are conducting our IDE clinical trial in the United States, with the goal of obtaining approval from the FDA for a premarket application, or PMA, and commercializing our Motiva Implants in the United States. The first patient in the study was enrolled in April 2018, and we anticipate completing enrollment in early 2019.

▪

Continue a high level of engagement with key opinion leaders. We promote Motiva Implants, in part, via an extensive and robust calendar of physician education events led by key opinion leaders in the field of aesthetic surgery. In 2018, we will conduct approximately 70 events through our MotivaEdge educational platform. We also collaborate actively with respected and influential key opinion leader surgeons to identify and develop new clinical applications for our existing products, as well as new product and strategic opportunities.

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Our Products and Technologies

The key characteristics of our primary products are described in the table below:



Product	Motiva Implants	Divina	Puregraft

Description	Soft silicone-gel filled breast implants with improved appearance, feel and safety	3D simulation device and proprietary tissue modeling software	Autologous graft of healthy, viable adipose (fat) cells for filling and contouring
Product Catalog	Available in more than 1,000 product variations, including four projection heights	For use with breast surgeries	Available in three graft volumes: 50cc, 250cc, and 850cc
Key Features	▪ SilkSurface/SmoothSilk shell surface ▪ ProgressiveGel PLUS, ProgressiveGel Ultima, Silicone filling gels ▪ Ergonomix design ▪ TrueMonobloc construction ▪ QInside Safety Technology RFID microtransponder ▪ BluSeal shell barrier layer	▪ Pre-operative 3D planning that enables patients and physicians to visualize post-surgical result and measure pre-existing breast volume to optimize implant selection ▪ May increase clinical consultation efficiency ▪ MotivaHybrid: fat grafting can be used in conjunction with Motiva Implants by measuring pre-existing volume of the breast and calculating the appropriate ratio between silicone implant and fat graft	▪ Purifies adipose tissue through selective filtration technology ▪ Self-contained purification process preserves sterility ▪ MotivaHybrid: can be used in conjunction with Motiva Implants ▪ We are the exclusive distributor outside of the United States and Canada
Sales Territories	Over 60 countries outside the United States including nine of the top ten markets by country for total breast augmentations in 2016

Motiva Implants

We launched Motiva Implants commercially in October 2010, and to date we have sold over 446,000 units in various countries outside the U.S. Motiva Implants incorporate a number of proprietary features that we believe contribute to Motiva Implants’ favorable safety profile as well as a natural appearance and feel. Our latest generation of Motiva Implants utilize our proprietary Ergonomix design, a round base implant that responds to gravity by shifting its maximum point of projection, offering the projection of a shaped implant without the malpositioning and rotation issues frequently associated with shaped implants. Furthermore, our ProgressiveGel family of silicone gel rheologies consists of four highly purified biocompatible gels with specific visco-elastic properties that we believe enables Motiva Implants to respond to the patient’s motion in ways that more closely mimic the appearance, feel and movement of natural breast tissue . Our catalog includes over 1,000 product variations, with round, oval and anatomical shapes, two different surfaces and volumes ranging from 105cc to 1,050cc, making it a wider range of options than those offered by our major competitors.

SilkSurface/SmoothSilk

The International Standard Organization, through the new April 2018 standard (ISO 14607:2018), created a classification of implant surface textures according to roughness. This standard includes an objective way of defining the difference between smooth, micro and macro surfaces based on roughness average. The topology of SilkSurface/SmoothSilk is characterized under the smooth category, having a low roughness value of 3.6 microns with approximately 49,000 contact features per square centimeter, with a mean feature height of 13 microns and a defined, narrow distribution of feature sizes.

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Our retrospective implant data shows that Motiva Implants have a lower rate of capsular contracture and seromas when compared to available published data from competitors. We believe that these results are due in large part to the proprietary surface texturing of our Motiva Implants. Our proprietary shell surfaces are smoother and have more regular surface features than those of our primary competitors based on several studies using methods such as scanning electron microscopy, profilometry testing and statistical parameters comparisons.

A study performed in mice at the Langer Lab, by Professor Robert Langer, Institute Professor at the MIT Department of Chemical Engineering indicated that our SmoothSilk/SilkSurface attracts fewer macrophages than a traditional smooth surface. A larger percentage of macrophages in the cell mix indicates an inflammatory response, which is an early step in capsule formation. We believe the more moderate inflammatory response observed on SmoothSilk/SilkSurface is responsible for improved biocompatibility and lower complication rates.

In addition, an abstract presented in 2017 by researchers at Montana State University showed less accumulation of both bacteria and biofilm on SmoothSilk/SilkSurface in vitro when compared to smoother and textured surfaces. Biofilm formed on implant surfaces increases the risk of bacteria accumulation and capsule formation.

The graph below shows how the size of our surface features compares with those of our competitors.

ProgressiveGel Family

The proprietary silicone chemistries that comprise our ProgressiveGel family allow for a high degree of cohesiveness and strength, but add characteristics such as softness and high ductility that enable movement dynamics more like that of natural breast tissue. We believe that the cohesive properties reduce the likelihood of silicone gel leakage in the event of a rupture in the shell. The strength of the gel is believed to contribute to a reduced frequency of gel fracture, a condition which leads to deformed implant shape and stress on the implant’s shell. While other manufacturers have claimed a “high strength” gel, ours combines a notably high elasticity (the ability to stretch without permanent deformation) with low viscosity, both of which reduce the susceptibility of the implant to rupture or breakage while improving their tactile feel and movement dynamics. Additionally, the improved adhesion of the gel to the shell structure avoids the appearance of separation spots, an aesthetic defect commonly seen in competitor products.

In addition to the safety advantages, our ProgressiveGel family provides for movement characteristics that resemble natural breast tissue. Our later generation Ergonomix products further mimic natural tissue, with a maximum point of projection that shifts downward to create a natural human breast shape when a patient is standing. This allows our Motiva Implants to provide the more natural aesthetics of “shaped” or “teardrop” implants without the risk of associated drawbacks such as breast deformation form rotation and unnaturally hard tactile feel. The images below illustrate the implants’ ability to change shape depending on the patient’s positioning.

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TrueMonobloc

Our TrueMonobloc technology, which is incorporated into all generations of Motiva Implants currently sold, combines proprietary chemistry with our proprietary manufacturing techniques to create a shell, gel and other components that are tightly bound to one another. This results in an implant that is more homogeneously elastic and resistant to separation of the gel from the shell, addressing one type of implant failure that can lead to shell ruptures and silicone leaks. This also enables Motiva Implants to be stretched and squeezed to a more significant degree, which we believe currently enables breast augmentation through incision sizes smaller than one inch, compared with the published industry norm of approximately two inches. A branded surgery that we are developing, which we call Motiva Minimally Invasive Natural Technique, or Motiva MINT, would utilize a next-generation implant to take advantage of these physical properties to enable a less-invasive procedure for the patient. The implants associated with Motiva MINT have been developed, and we plan to begin the CE marking process in 2018. Instruments and special devices for the Motiva MINT procedure are currently being prototyped and tested and will require regulatory approval prior to commercialization. The following image shows that TrueMonobloc enables significant manipulation of a Motiva Implant without separation of gel from shell.

QInside Safety Technology RFID Technology

We offer the QInside Safety Technology as an optional feature in our Motiva Implants. QInside Safety Technology provides a Radio-Frequency Identification Device, or RFID, microtransponder, specially manufactured and encapsulated for implantation in the human body, that is embedded in the gel of a Motiva Implant. The microtransponder contains only a unique 15 digit code that identifies the product, and does not contain any patient information . This microtransponder can be read with a simple pass from our non-invasive and inexpensive reading device, the QInside Safety Technology Reader, and the serial number corresponds with related information in our MotivaImagine database such as implant type, size and other characteristics. Patients can create a secure account, register the products and include applicable patient information either through the MotivaImagine application or our website, to access their implant information. Surgeons can access that implant-related information through our Motiva Implants website, but they can only view patient-specific information of patients that have been linked to them after the patient or the surgeon creates a secure account and registers the products and provide patient information. The MotivaImagine application and Motiva Implants website also allow the patient to access the implant warranty information. This traceability is intended to give patients comfort that any future recalls can be positively identified as applying, or not applying, to that patient’s particular implant. This addresses a key concern that often discourages women who are otherwise interested in implants from making the choice to move forward with surgery. Motiva Implants are currently the only breast implants on the international market with QInside Safety Technology; however, we believe there is an opportunity to sell these microtransponders to our competitors in the space.

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Each implant’s unique electronic serial number is encoded into the RFID circuitry as part of a three point authentication system: the microtransponder, the reader and the database. This authentication system prevents unauthorized access to any personal information of the patient and is compliant with FDA regulations .

We also believe that additional functionality can be added to this microtransponder platform. Future potential applications currently under development include temperature sensing as a means of infection detection or pressure sensing as a means of detection of shell rupture.

BluSeal

Our BluSeal technology embeds a visually distinct layer of blue silicone into the SilkSurface shell. This patent-pending manufacturing innovation is intended to highlight any imperfections in the barrier layer coverage with a distinct color. This provides the plastic surgeon with the ability to verify whether the barrier layer has coverage defects or other imperfections before implantation that might lead to post-implantation shell rupture or gel bleed. We believe this is another safety innovation that contributes to our substantially lower reported implant rupture rates as compared to reports for our primary competitors.

Divina 3D Simulation System

We sell our Divina 3D surgical simulation systems to distributors and plastic surgeons for use in pre-surgical patient consultations and planning. Divina utilizes a combination of 3D imaging hardware and proprietary Tissue Behavior Simulation software to give physicians and patients the ability to visualize the potential aesthetic result of a procedure and to explore various implant sizes in real time.

Current methodologies for choosing the base size and projection of an implant are highly subjective. The same size implant will yield very different aesthetic results depending on the patient’s existing breast mass, breast shape, and torso geometry. Divina improves this process in two key ways: for the physician, the simulation engine and software allows a rapid and precise way to narrow down the patient’s choices to a handful of Motiva Implant sizes that will yield the

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patient’s desired look, and for the patient, the ability to see a rendered simulation of her own body increases the level of confidence that a surgery will achieve her aesthetic goals.

We believe that the addition of a Divina system to a clinic can facilitate an increase in the number of patients who proceed from a consultation to a surgical procedure. We intend to make the sale of Divina systems a key component of our sales and marketing strategy going forward.

Puregraft and Tulip - Autologous Fat Augmentation

Adipose (fat) tissue removed from one area of a patient’s body can be re-injected under the skin of the face, breasts, or in other areas where augmentation and shaping are desired. In the breast augmentation context, there is an unmet need for predictable contouring around the edges of the breast, both with and without volume augmentation via silicone implants. Puregraft LLC’s line of products provides surgeons with a tool for additional contouring around breast implants, which we call MotivaHybrid when used in combination with Motiva Implants and a 3D pre-surgical scan using our Divina system or another 3D scanning system.

In an independent study by Gerth et al. reported in the peer-reviewed Aesthetic Surgery Journal in 2014 conducted between November 2010 and November 2012, 26 patients that had received autologous adipose tissue grafts for facial contouring processed via Puregraft had significantly higher long-term retention of volume when compared to 33 patients that had received grafts processed using conventional means, with statistical significance being determined by a p-value of 0.03. In another independent study conducted by Sforza et al. at Dolan Park Hospital published in the Aesthetic Surgery Journal in 2016, in the breast augmentation setting, a clinical study of 26 patients, whose implant procedures were subsequently enhanced with Puregraft-enabled grafts between April 2013 and October 2014, resulted in approximately 73% of fat volume being retained by patients at one year, and 96% of patients reported satisfaction with the outcome. We believe these results illustrate the benefits of Puregraft versus other conventional means of extracting and purifying this tissue.

In September 2016, we became the exclusive distributors, outside the United States and Canada, of the Puregraft line of products for autologous adipose tissue harvesting and redistribution. Puregraft LLC currently sells its products in the United States and Canada itself. These devices are CE Marked for sale outside the United States and Canada, and hold a 510(k) clearance for sale in the United States. The initial term of our distribution agreement with Puregraft ends in September 2019, but we have the ability to renew the agreement at the end of the initial term if we wish to do so and meet certain minimum purchase requirements.

These procedures require a cannula for tissue extraction and reinsertion, and we also sell a special cannula for this purpose made by Tulip Medical Products. This cannula is differentiated by its proprietary rounded shape and low-friction coating, which are aimed at reducing trauma to the patient or implant during the procedure.

MotivaImagine Centers


▪	either our Divina or AX3 3D simulator, or a third party cloud-based visualization software that we sell in partnership with Crisalix systems;


▪	access to the full suite of MotivaImagine products that complement Motiva Implants;


▪	surgical staff trained by Establishment Labs in the optimal use of MotivaImagine products; and


▪	branding and design elements, according to company guidelines, that are intended to create a more luxurious and reassuring experience for patients.

Branded Surgeries

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autologous adipose tissue grafts. The MotivaHybrid method is designed to enable surgeons to optimize silicone volume using Motiva Implants and balance the ratio of silicone to tissue with additional contouring using Puregraft for more natural balanced results and improved patient satisfaction. Our second branded surgery, Motiva MinimalScar, allows surgeons to significantly reduce the size of the surgical incision by using our proprietary MotivaImagine Ultralight LED Retractor in conjunction with the Motiva Insertion Sleeve. We are also developing Motiva Minimally Invasive Natural Technique, or Motiva MINT — a family of branded surgeries that we anticipate will allow breast augmentation through small incisions. We intend for Motiva MINT to allow breast augmentation procedures to be performed under local anesthesia rather than general anesthesia, with faster recovery times and a resulting reduction of surgical complications. The implants associated with Motiva MINT have been developed, and we currently intend to begin the CE marking process in 2018. Instruments and special devices for the Motiva MINT procedure are currently being prototyped and tested and will require regulatory approval prior to commercialization. We believe Motiva MINT will be able to attract new customers and expand the market for breast aesthetic procedures.

Our Clinical Data

7-Year Safety Postmarket Surveillance Data

Dating from the commercial launch of Motiva Implants in October 2010 through March 2018, we have sold approximately 446,000 breast implants in various countries outside the United States and Canada. We maintain a Quality Management System database to log all complaints received from patients or physicians. Since 2010, a total of 324 complaints have been reported, investigated and processed, representing less than 0.1% of the total patients receiving Motiva Implants as of March 2018. There were no reported cases of late seroma, double capsule formation or ALCL in this data set, and there were six cases of seroma. The table below shows the rates of rupture, capsular contracture and reoperation for adverse events of our Motiva Implants from data gathered through March 2018. In contrast to the above competitor data, our data is self-reported rather than collected at mandatory follow-ups and was generated solely for our post-market surveillance instead of in connection with an FDA PMA approval study. All of these patients were located outside the United States.




		Motiva Implants
Number of Implants		N=446,773 Implants ⁽¹⁾
Rupture		< 0.1%
Capsular Contracture		< 0.1%
Reoperation for Adverse Events		< 0.1%
Reoperation (All Causes)		N/A ⁽²⁾

(1) Data is internally tracked on an individual implant basis rather than by patient.
(2) Complaint database does not capture reoperations for reasons not related to safety.

Independent Clinical Experience

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(1) Name of FDA approved competitors have not been published.

10-Year Prospective Trial: 4- and 7-year Data

In addition to the review of safety data shown above, we are conducting a prospective study at a single clinical center in Costa Rica to assess patient safety with Motiva Implants. The study is being conducted by two board-certified plastic and reconstructive surgeons at a single plastic surgery center accredited by the American Association for Accreditation of Surgery Facilities. Both of the surgeons who conducted this study are related to our chief executive officer. The participants in the study received two Motiva Implants free of charge and the plastic surgery center received an additional two Motiva Implants for each patient enrolled as compensation for the study. This study measures outcomes similar to those that will be required in our planned, larger, clinical study to support U.S. marketing authorization. The current study has enrolled 233 patients in two groups: Group A (n=35 patients, with 30 currently evaluable for seven year follow-up) and Group B (n=198, with 47 currently evaluable through four year follow-up). Group B was an expansion cohort enrolled after sufficient initial safety had been demonstrated in Group A. All patients were elective primary augmentation cases. The protocol calls for follow-up evaluations at 24 hours, four days, two weeks, one month, three, six, twelve months, two years and three years, with yearly evaluations thereafter, and the final evaluation at ten years post-implantation. The table below shows patient adverse event rates from our prospective study of Motiva Implants.

Adverse Event Rates with Motiva Implants




Cohort Size	N=35 Patients 30 evaluable at 7 years	N=198 Patients 47 evaluable at 4 years
Ruptures	0.0%	0.0%
Capsular Contracture	0.0%	0.0%
Reoperations (Adverse Events)	0.0%	0.0%
Reoperations (All Causes)	9.4%	0.0%

In Group A, 32 patients have reached the seven year evaluation point. Two patients out of the 32 primary augmentation cases followed up for seven years did not attend the seven year follow-up visit. There have been no cases reported of implant rupture, capsular contracture, double capsule, late seroma, seroma, ALCL or reoperation for safety reasons. Two patients opted for reoperation to change the breast implant size, and one patient opted for a revision surgery with mastopexy (breast lift). The most common adverse events were changes in nipple sensation, ptosis (lengthening of the breasts), and post-operative pain.

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In Group B, 198 patients have been enrolled as of April 2018, with 47 Group B patients evaluable through the four year valuation point. Group B has not resulted in any cases of implant rupture, capsular contracture, double capsule, late seroma, seroma, ALCL or reoperation for safety reasons.

No serious illness were attributed to the implants in either Group A or Group B.

Study To Support a PMA

We have started conducting a prospective IDE clinical trial in the United States . Our IDE request was approved by the FDA on March 20, 2018 to perform a single open-label, multi-center trial, with follow-up visits available at the time of filing. We will continue to monitor patients for ten years post-implantation. The primary endpoints of the trial will be safety, effectiveness and patient satisfaction. In general, our trial design and patient enrollment are consistent with prior PMA studies conducted by Allergan, Mentor, and Sientra. Our first patient was enrolled in the clinical trial on April 6, 2018, and we anticipate completing enrollment in early 2019.

Sales and Marketing

We primarily derive revenue from sales of our Motiva implants from two types of customers: (1) medical distributors and (2) direct sales to physicians, hospitals, and clinics. We currently sell our products in over 60 countries through exclusive distributors, except in Brazil, France, Sweden, Denmark, Norway and the United Kingdom where we sell through our direct sales force. As of March 31, 2018 , our sales organization included 55 employees and contractors. All of these sales personnel are supported through a suite of tools, including marketing and training materials, mobile smartphone applications, and access to a robust schedule of physician education events. We also apply significant attention to helping our distributors maintain positive relationships with surgeons and clinics in their respective regions, and to positioning our product in the marketplace as a premium product with consequent premium pricing.

We demonstrate our confidence in Motiva Implants with the Motiva Always Confident Warranty, which offers patients a free replacement for any Motiva Implant that ruptures, for the life of the product. We also replace any implant which is replaced due to capsular contracture of Baker Grade III or IV severity at any time in the first 10 years post-implantation. We also offer an extra-cost extended warranty, which provides financial assistance of up to $2,500 to cover surgical costs resulting from rupture or capsular contracture.

We employ a multi-faceted marketing strategy that includes social media engagement, conferences, advertisements and education.

Intellectual Property

Our success depends at least in part upon our ability to protect our core technology and intellectual property. To accomplish this, we rely on a combination of intellectual property rights, including patents, trade secrets and trademarks, as well as customary contractual protections.

We have assembled a broad portfolio of intellectual property related to our medical device and aesthetics products. We believe this intellectual property, combined with proprietary manufacturing processes and the regulatory approvals we have successfully obtained outside of the United States , provides us with a strong market position. As of April 30, 2018, we own or have rights to three issued and seven pending patents in the United States related to various aspects of our Motiva implants (such as implant barrier layers, surface texture technology, minimally invasive implant delivery systems, and our QInside Safety Technology radio frequency identification devices). In addition, we have six pending foreign applications and six pending PCT applications. Our owned and licensed patents are expected to expire at various times between March 2026 and September 2034. Our owned and licensed pending applications, if granted, likely would expire between April 2027 and October 2037.

In addition to pursuing patents on our products, we have taken steps to protect our intellectual property and proprietary technology by entering into confidentiality agreements and intellectual property assignment agreements with our employees, consultants, corporate partners, and, when needed, our advisors. Such agreements may not be enforceable or may not provide meaningful protection for our trade secrets or other proprietary information in the event of unauthorized use or disclosure or other breaches of the agreements, and we may not be able to prevent such unauthorized disclosure. Monitoring unauthorized disclosure is difficult, and we do not know whether the steps we have taken to prevent such disclosure are, or will be, adequate. In addition, we intend to expand our international operations, and effective patent, copyright, trademark and trade secret protection may not be available or may be limited in foreign countries.

In general, the medical device industry is characterized by the existence of a large number of patents and frequent allegations and related litigation regarding patent and other intellectual property rights. Third parties, including our

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competitor companies, may assert patent, copyright, trademark and other intellectual property rights against us, our partners or our customers. Our standard license and other agreements may obligate us to indemnify our partners and customers against such claims. We could incur substantial costs and divert the attention of our management and technical personnel in defending against any such claims. Successful claims of infringement by a third party could prevent us from selling or distributing certain products or performing certain services, require us to expend time and resources to develop non-infringing products, or force us to pay substantial damages, including treble damages if we are found to have willfully infringed patents-royalties or other fees. We cannot assure you that we do not currently infringe, or that we will not in the future infringe, upon any third-party patents or other proprietary rights.

Research and Development

Our goal is to continue to improve the existing products on our MotivaImagine platform, as well as develop new products and new branded surgical techniques. We have a highly experienced team and deep customer and key opinion leader relationships. We also have sophisticated internal prototyping and testing equipment. These allow us to invent, develop, test, and commercialize products with in-house resources. As a result, we have introduced four distinct generations of Motiva Implant product since October 2010, with innovative features added to each successive generation.

We have and will continue to work with several institutions in our effort to advance implant technology, and generate additional scientific data to support the improved safety outcomes associated with our products, including:


▪	Massachusetts Institute of Technology (MIT)


▪	Medical University of Innsbruck


▪	Plastic and Reconstructive Research Center at the University of Manchester


▪	Center for Biofilm Engineering of Montana State University


▪	The Chair of Plastic Surgery at the School of Medicine and Psychology of Sapienza University of Rome


▪	Microscopic Structure Research Center of the University of Costa Rica

We have incurred, and expect to continue to incur, significant research and development expenses. For the years ended December 31, 2015, 2016 and 2017, our research and development expenses were $0.6 million, $2.7 million and $6.9 million , respectively. For the three months ended March 31, 2017 and 2018, our research and development expenses were $1.5 million and $2.1 million , respectively. Our research and development expenses consist of costs associated with our clinical and post-approval studies, regulatory activity and product development, including the development of Motiva Implants and other current and future aesthetic and reconstruction surgical devices on the MotivaImagine platform.

Implantable RFID Microtransponder Platform

The RFID technology platform that we use in the QInside feature of our Motiva Implants is independently cleared as a system via the FDA’s 510(k) pathway. We are developing more sophisticated functionality using this technology platform. We believe our RFID technology will be an attractive platform for a variety of other applications, including unique device identification for other types of implantable medical devices, functional implantable biosensors, and diagnostic monitoring. Future specific indications include detection of device life cycles (e.g. flexion/contraction cycles for artificial hip and knee joints) and monitoring of analytes such as circulating tumor cells and blood chemistry components. Some of these applications we may choose to develop and commercialize internally, while others may be more appropriately commercialized via partnerships with other medical device companies.

We control all the activities of the development and manufacturing of our QInside Safety Technology RFID transponders. This allows us for adapting to specific needs or new developments in our field.

Manufacturing and Suppliers

Facilities

We manufacture our products in ISO-13485-certified manufacturing facilities located in the Coyol Free Zone office park in Costa Rica, a park populated by a number of international medical device companies and granted tax-advantaged status by the government of Costa Rica. Our newest and largest manufacturing facility opened at the end of 2016 and we began shipping manufactured product from this facility in March 2017. This facility has more than 13,000 square feet of office space and production areas which are capable of producing over 400,000 implants a year, with state-of-the-art support systems for sustaining production, including an ice-bank system for cooling the controlled air in the clean room and support areas, water-lubricated air compressors for eliminating the presence of oil particulates, heat recovery systems for energy saving, and an energy micro-grid comprised of solar panels and energy-storage batteries. These energy efficient systems generate up to 80% of the total energy consumption of the building, which received LEED Gold

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Certification by the U.S. Green Building Council in August 2017. Our initial facility was established in 2009 and has about 3,000 square feet of production areas, capable of producing over 100,000 implants a year.

In July 2017, both facilities received the MDSAP regulatory certification. MDSAP was established by a coalition of international medical device regulatory authorities including Australia’s TGA, Brazil’s ANVISA, Health Canada, Japan’s MHLW and PMDA and the U.S. FDA. The goal of MDSAP is to allow a single regulatory audit of a medical device manufacturer’s Quality Management System to satisfy the needs of the participating regulatory jurisdictions. This program enables manufacturers to contract with an authorized third-party auditing organization, in our case the British Standards Institute, to conduct a single audit to satisfy the relevant regulatory requirements of the participating regulatory authorities including the FDA, which recognizes MDSAP audit reports as a substitute for FDA Establishment Inspection Reports.

We are also subject to periodic inspections and audits by various international regulatory and notified bodies, and we believe our past performance in these audits reflects the strength of our quality system and manufacturing controls. We consider this to be a key element of our risk management and business continuity strategies and a competitive advantage as we have full control of the product life-cycle. Our in-house manufacturing team includes over 200 employees, all of whom undergo well defined training programs throughout their period of employment. We believe our manufacturing experience, know-how, and process-related trade secrets are also a competitive advantage.

Process

We produce our shell surfaces using a novel 3D negative imprinting molding technique that allows much more precise control over feature size, a uniform distribution of features on the surface, no particles creation, and less unit-to-unit variation. Our primary competitors utilize the “salt-loss” technique or “polyurethane foam imprint” technique. The “salt-loss” technique blows crystals of salt or sugar onto the uncured silicone shell in order to produce surface texture and the “polyurethane foam imprint” technique uses a foreign material to press against the last uncured silicone layer to produce surface features. We believe our 3D negative imprinting technique is more efficient and consistent than the techniques used by our competitors because the application of our surface texture is integrated with the molding process, rather than requiring a separate, subsequent process.

Suppliers

We source manufacturing inputs from a number of outside suppliers. In particular, we obtain NuSil brand medical-grade silicone from Avantor (previously NuSil Technology LLC ), which is a sole-source supplier of such product to the entire silicone breast implant industry. In 2016, we entered into a new supply agreement with NuSil-Avantor, which provides for specified prices per unit of each relevant component through 2021, with potential extensions beyond that date.

Other critical materials are the silicone patches and other silicone components used for the assembly of our breast implants. All these components are also made with NuSil medical-grade silicone, and manufactured by specialized silicone contract manufacturing suppliers. All component suppliers undergo strict quality inspections to ensure these can meet our quality standard. Other important components are the primary packaging polycarbonate trays, the Tyvek sealing lids and packaging. All these components are also critical to maintain integrity of the product throughout its shelf-life and all these suppliers must be qualified and materials must be validated prior to being approved for manufacturing activities. Most suppliers are evaluated annually and we carry second source supplier activities to ensure business continuity and quality and costs improvement.

Competition

The market for silicone breast implants is relatively concentrated, with Allergan plc and Mentor Worldwide LLC, a division of Johnson & Johnson. In the United States , Sientra, Inc. is the only other company with an approved silicone implant product. Internationally, the market is more fragmented, with GC Aesthetics plc, Silimed, Inc., Groupe Sebbin SAS, Hans Biomed Crop., Polytech Health & Aesthetics, and Arion Laboratories.

Our major competitors in the silicone marketplace are either publicly-traded companies or divisions or subsidiaries of publicly-traded companies with significantly more market share and resources than we have. These companies have greater financial resources for sales, marketing and product development, broader established relationships with health care providers and third-party payors, and larger and more established distribution networks. In some instances, our competitors also offer products that include features that we do not currently offer in all geographies . Our competitors also have regulatory approval to market and sell their products in countries where we currently do not, notably the United States . In addition, our competitors may offer pricing programs with discounts across their non-breast aesthetic product portfolios.

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We also face potential future competition from a number of companies, medical researchers and existing medical device companies that may be pursuing new implant technologies. These include non-implant breast augmentation through injections of autologous adipose tissue, new material technologies such as synthetic fillers, and new methods of enhancing and reconstructing the breast.

We believe the primary competitive factors in our current and future markets include:


▪	safety and outcomes data generated in clinical studies;


▪	regulatory approvals;


▪	technological characteristics of products;


▪	complementary platforms of non-implant products, such as facial fillers and fat grafting technologies;


▪	product price;


▪	customer service; and


▪	support by key opinion leaders.

Federal Food, Drug, and Cosmetic Act

Breast implants are regulated as Class III medical devices in the United States , and are subject to the Federal Food, Drug, and Cosmetic Act as implemented and enforced by the FDA. The FDA administers requirements covering the design, development, testing, safety, effectiveness, manufacturing, labeling, promotion, advertising, distribution, and postmarket surveillance of medical devices. Medical devices are classified as Class I (lowest risk), II (moderate risk), or III (highest risk). Unless an exemption applies or the product is a Class I device, each medical device that we market must first receive either premarket notification clearance (by filing a 510(k) submission) or premarket approval (by filing a PMA) from the FDA. Breast implants are currently classified as Class III devices requiring an approved PMA for commercial distribution. In addition, certain modifications made to marketed devices also may require 510(k) clearance or approval of a PMA supplement.

The process of obtaining FDA clearance or approval of a medical device can be lengthy and costly. The FDA’s 510(k) clearance process usually takes from three to twelve months, but it can take longer. The process of obtaining PMA approval is much more costly, lengthy, and uncertain, and is generally preceded by the conduct of pre-clinical testing and a well-controlled clinical study. The FDA’s guidance document “Saline, Silicone Gel, and Alternative Breast Implants” currently recommends that a core study, which can be a single, open label, multi-center study, be conducted with ten years or more of prospective patient follow-up. To date, PMAs for silicone breast implants have been submitted for approval to the FDA with a minimum of three years of premarket core study data. Additionally, the FDA will not approve the PMA until it conducts a pre-approval inspection of our manufacturing facility and determines that it is in compliance with good manufacturing practices, as set forth in the FDA’s Quality System Regulation or QSR. The PMA review and approval process generally takes from one to three years, but may take longer. The FDA’s guidance document “Saline, Silicone Gel, and Alternative Breast Implants” also states that manufacturers seeking approval of breast implants will be subject to post-approval requirements, which may include, but are not limited to, long-term follow-up of the core clinical study patients, conduct of separate post-approval studies, participation in a patient registry or other studies, and training programs for physicians and surgeons, and periodic reporting requirements.

In addition to regulations governing 510(k) and PMA submissions, we are subject to regulations governing the conduct of clinical investigations, including regulations related to informed consent, Institutional Review Board review and approval, Good Clinical Practices, or GCPs, and labeling of investigational devices. Our clinical study sites are subject to possible inspection by the FDA. We received an IDE approval from the FDA in March 2018, to initiate a clinical trial and our first patient was enrolled in April 2018.

When we initiate commercial distribution of our devices in the United States , we will be subject to FDA device listing and establishment registration, good manufacturing practice requirements as set forth in the QSR, labeling requirements, reporting of adverse events and device malfunctions, post-approval restrictions or conditions, post-market surveillance requirements, and reporting requirements for product recalls, or corrections or removals in the field. Our manufacturing facilities, as well as those of certain of our suppliers, will be subject to periodic and for-cause inspections by the FDA to verify compliance with the QSR and other regulatory requirements.

HIPAA and Other Privacy Laws

The Health Insurance Portability and Accountability Act of 1996, or HIPAA, established for the first time comprehensive protection for the privacy and security of protected health information. HIPAA standards apply to three types of organizations, or “Covered Entities”: certain health plans, health care clearing houses, and health care providers which conduct certain health care transactions electronically. Covered Entities and their “Business Associates”: entities that

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perform services on behalf of a Covered Entity that involves the creation, use, maintenance or disclosure of protected health information, must have in place administrative, physical, and technical standards to guard against the misuse of protected health information. Some of the institutions and physicians from which we obtain biological specimens that we use in our research and validation work are Covered Entities and must obtain proper authorization from their patients for the subsequent use of those samples and associated clinical information. We may perform future activities that may implicate HIPAA, such as providing clinical laboratory testing services or entering into specific kinds of relationships with a Covered Entity or a Business Associate of a Covered Entity.

Additionally, the Health Information Technology for Economic and Clinical Health Act, enacted as part of the American Recovery and Reinvestment Act of 2009 amended HIPAA by increasing the civil and criminal penalties that may be imposed against Covered Entities, their Business Associates and possibly other persons, and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorney’s fees and costs associated with pursuing federal civil actions.

Our activities must also comply with other applicable privacy laws. For example, there are also international privacy laws that impose restrictions on the access, use, and disclosure of health information. All of these laws may impact our business. If we fail to comply with these privacy laws, or if significant changes in the laws restrict our ability to obtain tissue samples and associated patient information, this could significantly impact our business and our future business plans.

Federal and State Billing and Fraud and Abuse Laws

Antifraud Laws/Overpayments

As participants in national and state health care programs, we may be subject to numerous national and state antifraud and abuse laws in various countries. Many of these antifraud laws are broad in scope, and neither the courts nor government agencies have extensively interpreted these laws. Prohibitions under some of these laws include:


▪	the submission of false claims or false information to government programs;


▪	deceptive or fraudulent conduct;


▪	excessive or unnecessary services or services at excessive prices; and


▪	prohibitions in defrauding private sector health insurers.

One of these statutes, the federal False Claims Act, is a key enforcement tool used by the government to combat health care fraud. The federal False Claims Act imposes liability on any person who, among other things, knowingly presents, or causes to be presented, a false or fraudulent claim for payment by a federal health care program. In addition, violations of the federal physician self-referral laws, such as the Stark laws discussed below, may also violate false claims laws.

Numerous federal and state agencies enforce the antifraud and abuse laws. In addition, private insurers may also bring private actions. In some circumstances, private whistleblowers are authorized to bring fraud suits on behalf of the government against providers and are entitled to receive a portion of any final recovery.

Federal and State “Self-Referral” and “Anti-kickback” Restrictions

Self-Referral Law

We will be subject to a federal “self-referral” law, commonly referred to as the “Stark” law, which provides that physicians who, personally or through a family member, have ownership interests in or compensation arrangements with a laboratory are prohibited from making a referral to that laboratory for laboratory tests reimbursable by Medicare, and also prohibits laboratories from submitting a claim for Medicare payments for laboratory tests referred by physicians who, personally or through a family member, have ownership interests in or compensation arrangements with the testing laboratory. The Stark law contains a number of specific exceptions which, if met, permit physicians who have ownership or compensation arrangements with a testing laboratory to make referrals to that laboratory and permit the laboratory to submit claims for Medicare payments for laboratory tests performed pursuant to such referrals. The Stark law contains similar prohibitions and exceptions with respect to referrals by physicians for other designated health services to entities in which the referring physician has a financial interest.

We will be subject to comparable state laws, some of which apply to all payors regardless of source of payment, and do not contain identical exceptions to the Stark law. For example, we will be subject to a North Carolina self-referral law that prohibits a physician investor from referring to us any patients covered by private, employer-funded or state and federal employee health plans. The North Carolina self-referral law contains few exceptions for physician investors in securities that have not been acquired through public trading, but will generally permit us to accept referrals from physician investors who buy their shares in the public market.

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We have several shareholders who are physicians in a position to make referrals to us. We have included within our compliance plan procedures to identify requests for testing services from physician investors and we do not bill Medicare, or any other federal program, or seek reimbursement from other third-party payors, for these tests. The self-referral laws may cause some physicians who would otherwise use our laboratory to use other laboratories for their testing.

Anti-Kickback Statute

The federal Anti-Kickback Statute prohibits persons from knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, to induce either the referral of an individual, or the furnishing, recommending, or arranging for a good or service, for which payment may be made under a federal health care program, such as the Medicare and Medicaid programs. The term “remuneration” is not defined in the federal Anti-Kickback Statute and has been broadly interpreted to include anything of value, including for example, gifts, discounts, the furnishing of supplies or equipment, credit arrangements, payments of cash, waivers of payment, ownership interests and providing anything at less than its fair market value. The reach of the federal Anti-Kickback Statute was also broadened by the Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Reconciliation Act, or PPACA, which, among other things, amended the intent requirement of the federal Anti-Kickback Statute and certain criminal health care fraud statutes . Pursuant to the statutory amendment, a person or entity does not need to have actual knowledge of this statute or specific intent to violate it in order to have committed a violation. In addition, PPACA provides that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the federal False Claims Act or the civil monetary penalties statute, which imposes penalties against any person who is determined to have presented or caused to be presented a claim to a federal health program that the person knows or should know is for an item or service that was not provided as claimed or is false or fraudulent.

The OIG has criticized a number of the business practices in the clinical laboratory industry as potentially implicating the federal Anti-Kickback Statute, including compensation arrangements intended to induce referrals between laboratories and entities from which they receive, or to which they make, referrals. In addition, the OIG has indicated that “dual charge” billing practices that are intended to induce the referral of patients reimbursed by federal health care programs may violate the federal Anti-Kickback Statute.

Many states have also adopted laws similar to the federal Anti-Kickback Statute, some of which apply to the referral of patients for health care items or services reimbursed by any source, not only the Medicare and Medicaid programs, and do not contain identical safe harbors. For example, North Carolina has an anti-kickback statute that prohibits health care providers from paying any financial compensation for recommending or securing patient referrals. Penalties for violations of this statute include license suspension or revocation or other disciplinary action. Other states have similar anti-kickback prohibitions.

Both the federal Anti-Kickback Statute and the North Carolina anti-kickback law are broad in scope. The anti-kickback laws clearly prohibit payments for patient referrals. Under a broad interpretation, these laws could also prohibit a broad array of practices involving remuneration where one party is a potential source of referrals for the other.

Federal and State Transparency Laws

Beginning in August 2013, the Physician Payment Sunshine Act, enacted as part of PPACA, and its implementing regulations requires certain medical device manufacturers to track certain financial arrangements with physicians and teaching hospitals, including any “transfer of value” made or distributed to such entities, as well as any investment interests held by physicians and their immediate family members. Manufacturers are required to report this information to the U.S. Department of Health and Human Services, or HHS , on an annual basis. Various states have also implemented regulations prohibiting certain financial interactions with health care professionals or mandating public disclosure of such financial interactions. We may incur significant costs to comply with such laws and regulations now or in the future.

If we or our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we may be subject to penalties, including civil, criminal and administrative penalties, damages, fines, exclusion from participation in U.S. federal or state health care programs, additional reporting and government oversight, and the curtailment or restructuring of our operations. To the extent that any product we make is sold in a foreign country in the future, we may be subject to similar foreign laws and regulations, which may include, for instance, applicable post-marketing requirements, including safety surveillance, anti-fraud and abuse laws, and implementation of corporate compliance programs and reporting of payments or transfers of value to health care professionals. To reduce the risks associated with these various laws and governmental regulations, we have implemented a compliance plan. Although compliance programs can mitigate the risk of investigation and prosecution for violations of these laws, the risks cannot be entirely eliminated. Any action against us for violation of these laws, even if we

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successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business. Moreover, achieving and sustaining compliance with applicable federal and state privacy, security and fraud laws may prove costly.

International Medical Device Regulations

International marketing of medical devices is subject to foreign government regulations, which vary substantially from country to country. The European Commission is the legislative body responsible for directives, including Directive 93/42/EEC which, once implemented in each member state, must be complied with by manufacturers selling medical products in the EU and the European Economic Area, or EEA. The EU includes most of the major countries in Europe, while other countries, such as Norway and Switzerland, are part of the EEA and European Free Trade Area, or EFTA, respectively, and have voluntarily adopted laws and regulations that mirror those of the EU with respect to medical devices. The EU directives address regulation of the design, manufacture, labeling, clinical studies and post-market vigilance for medical devices. Devices that comply with the requirements of a relevant directive will be entitled to bear the CE conformity marking, indicating that the device conforms to the essential requirements of the applicable directives and, accordingly, can be marketed throughout the EU and EEA.

Outside of the EU, regulatory pathways for the marketing of medical devices vary greatly from country to country. In many countries, local regulatory agencies conduct an independent review of medical devices prior to granting marketing approval. For example, in China, approval by the SFDA must be obtained prior to marketing an medical device. In Brazil, the inspections and approvals of products and facilities carried out by the ANVISA and InMetro agencies are required prior to marketing a Class 3a medical device like our Motiva Implants. The process in such countries may be lengthy and require the expenditure of significant resources, including the conduct of clinical trials. In other countries, the regulatory pathway may be shorter or less costly. The timeline for the introduction of new medical devices is heavily impacted by these various regulations on a country-by-country basis, which may become longer and more costly over time.

U.S. Health Care Reform

In March 2010, the PPACA was enacted, which includes measures that have or will significantly change the way health care is financed by both governmental and private insurers. The PPACA contains a number of provisions, including those governing enrollment in federal health care programs, reimbursement changes and fraud and abuse measures, all of which will impact existing government health care programs and will result in the development of new programs. The PPACA, among other things, could result in the imposition of injunctions and imposes a tax of 2.3% on the retail sales price of medical devices sold after December 31, 2012. This tax may apply to Motiva Implants and some or all of our products which are in development. The excise tax has been temporarily suspended through the end of 2019 , but will be reinstated in 2020 without additional Congressional action.

Some provisions of the PPACA have yet to be implemented, and there have been judicial and Congressional challenges to certain aspects of the PPACA, as well as recent efforts to repeal or replace certain aspects of the PPACA. While Congress has not passed comprehensive repeal legislation, we expect there will be additional challenges and amendments to the PPACA in the future.

In addition, other legislative changes have been proposed and adopted since the PPACA was enacted. For example, the Budget Control Act of 2011, among other things, created the Joint Select Committee on Deficit Reduction to recommend proposals for spending reductions to Congress. The Joint Select Committee did not achieve a targeted deficit reduction of at least $1.2 trillion for the years 2013 through 2021, which triggered the legislation’s automatic reduction to several government programs, including aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, starting in 2013, which , due to subsequent legislative amendments to the statute, including the Bipartisan Budget Act of 2018, will remain in effect through 2027 unless additional Congressional action is taken. In January 2013, former President Obama signed into law the American Taxpayer Relief Act of 2012, or the ATRA, which delayed for another two months the budget cuts mandated by the sequestration provisions of the Budget Control Act of 2011. The ATRA, among other things, also reduced Medicare payments to several providers, including hospitals, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years. In March 2013, former President Obama signed an executive order implementing sequestration, and in April 2013, the 2% Medicare reductions went into effect. We cannot predict whether any additional legislative changes will affect our business.

The Foreign Corrupt Practices Act

The Foreign Corrupt Practices Act of 1977, as amended, or the FCPA, prohibits any U.S. individual or business from paying, offering or authorizing payment or offering of anything of value, directly or indirectly, to any foreign official, political party or candidate for the purpose of influencing any act or decision of the foreign entity in order to assist the individual or business in obtaining or retaining business. The FCPA also obligates companies whose securities are listed in the United States to comply with accounting provisions requiring us to maintain books and records that accurately and

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fairly reflect all transactions of the corporation, including international subsidiaries, and to devise and maintain an adequate system of internal accounting controls for international operations.

Employees

As of March 31, 2018 , we had 397 full-time employees. None of our employees are represented by a labor union or covered by collective bargaining agreements.

Facilities

Our principal executive offices are located in Alajuela, Costa Rica, where we occupy 34,750 square feet of office, laboratory and manufacturing space under two leases which expire in 2018 and 2026, respectively, and we are currently in the process of negotiating a four-year extension on the lease that expires in 2018. In order to increase our manufacturing capacity, we have constructed a new manufacturing facility of approximately 27,000 square feet, which began shipping manufactured product in March 2017. We have an option to purchase this manufacturing facility, and on May 11, 2016 we provided notice of our intent to exercise our purchase right and expect the transaction to complete by the end of 2018. We also have office and warehouse space in Wommelgem, Belgium, Sao Paulo, Brazil and Paris, France pursuant to leases that expire in August 2020, June 2023 and December 2026, respectively.

Scientific Advisory Board

The members of our scientific advisory board, none of whom are our officers or employees, provide us with advice and assistance on various matters regarding our breast implant products and the aesthetic surgical industry in general. We consider our scientific advisory board members to be opinion leaders in their respective fields, and they offer us advice and feedback regarding , among other things, the assessment of new technologies and their applications.

As of May 31, 2018 , our Scientific Advisory Board consisted of the following members:




Name		Position and Affiliation
Robert Langer, Ph.D.		David H. Koch Institute Professor, Massachusetts Institute of Technology
Ardeshir Bayat, M.D. & Ph.D.		Reader, School of Biological Sciences, University of Manchester
Brian Kinney, M.D.		Clinical Assistant Professor of Plastic Surgery at USC School of Medicine; Editorial board member of the Aesthetic Surgery Journal
Benjamin Lewin, Ph.D.		Founder of life sciences journal, Cell
John Hancock		Medical devices entrepreneur

We have entered into consulting agreements with all of the above advisors. Our advisory members are reimbursed for certain of their out-of-pocket expenses incurred in connection with company-related business, and certain of our advisory board members receive cash compensation for their services. In addition, we have granted share options to purchase common shares to certain advisory board members for their service.

Medical Advisory Board

The members of our medical advisory board, none of whom are our officers or employees, provide us with advice and assistance on medical and clinical topics regarding our breast implant products and the aesthetic surgical industry in general. We consider our medical advisory board members to be opinion leaders in their respective fields, and they offer us advice and feedback regarding, among other things, u nmet needs and opportunities, clinical feedback on existing products, and the assessment of new clinical applications.

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As of May 31, 2018, our Medical Advisory Board consisted of the following members:




Name		Position and Affiliation
Marcos Sforza, M.D.		Medical Director, The Hospital Group, UK
Alexandre Mendoca Munhoz, M.D.		Plastic Surgeon and Chief of Breast Reconstruction, Cancer Institute of Sao Paulo
Dennis Hammond, M.D.		Board Certified Plastic Surgeon; co-author of textbook Surgery of the Breast: Principles and Art
Manuel Enrique Chacon Quiros, M.D.		Attending Surgeon and Partner, Chacon Clinic
Niamh Corduff, M.D.		Past President of Australasian Society of Aesthetic Plastic Surgeons (ASAPS)

We have entered into consulting agreements with all of the above advisors and a clinical trial agreement with Dr. Chacon Quiros, who is the brother of our chief executive officer. Our advisory members are reimbursed for certain of their out-of-pocket expenses incurred in connection with company-related business, and certain of our advisory board members receive cash compensation for their services. In addition, we have granted share options to purchase common shares to certain advisory board members for their service.

Legal Proceedings

From time to time we may be involved in various disputes and litigation matters that arise in the ordinary course of business. We are not currently a party to any material legal proceedings, and we are not aware of any pending or threatened legal proceeding against us that we believe could have an adverse effect on our business, operating results or financial condition.

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MANAGEMENT

Directors, Executive Officers and Significant Employees

The following table sets forth information regarding our directors, executive officers and significant employees as of May 31, 2018:




Name	Age	Position
Executive Officers
Juan Jose Chacon Quiros	46	Chief Executive Officer and Director
Salvador Dada Santos	35	Chief Operating Officer
Renee Gaeta	37	Chief Financial Officer
Roberto De Mezerville	38	Chief Technology Officer
Significant Employees
Jeremy Livianu	37	General Counsel
Alberto Quesada	52	Vice President, Quality & OUS Regulatory Affairs
Non-Employee Directors
Lisa N. Colleran ⁽¹⁾⁽³⁾	60	Director
Ed Schutter ⁽¹⁾	66	Director
Allan Weinstein ⁽²⁾⁽³⁾	69	Director
David Hung, M.D. ⁽³⁾	60	Director
Nicholas Lewin ⁽¹⁾⁽²⁾	41	Director
Dennis Condon ⁽²⁾	69	Director


(1)	Member of the audit committee.


(2)	Member of the compensation committee.


(3)	Member of the nominating and corporate governance committee .

Executive Officers

Juan Jose Chacon Quiros . Mr. Chacon Quiros founded Establishment Labs, S.A. in 2004 and has been a director and the Chief Executive Officer of Establishment Labs Holdings Inc. since its inception in 2013. Mr. Chacon Quiros has been involved in several sectors of the aesthetics industry, including serving for almost a decade as General Manager of an aesthetic medical device distribution business in Latin America, and prior to that as Business Development Manager of a plastic and reconstructive surgery clinic in Costa Rica. He also served as President of the Rugby Federation of Costa Rica from 2009 to 2015. Mr. Chacón Quirós received his Baccalaureate at the Academie de Poitiers (Economics) and attended the University of Massachusetts at Amherst. He holds the MIT Sloan Advanced Certificate for Executives (ACE) in Management, Innovation and Technology.

We believe Mr. Chacon Quiros is qualified to serve on our board of directors due to his service as an executive officer of our company, extensive knowledge of aesthetic medical device company operations, and extensive experience working with companies, regulators and other stakeholders in the aesthetic medical device industry.

Salvador Dada Santos . Mr. Dada was appointed as our Chief Operating Officer in February 2016 and has served as a manager of operations and manufacturing since April 2009. Mr. Dada served in various engineering roles at Allergan Medical from 2007 to 2009 and in various production and manufacturing roles at Establishment Biotech, S.A. from 2004 to 2006. Mr. Dada received undergraduate and licentiate degrees in Industrial Engineering from the University of Costa Rica.

Renee Gaeta. Ms. Gaeta has been our Chief Financial Officer since July 2017. From August 2014 to June 2017, she was Vice President and Corporate Controller at Sientra, Inc., a global medical aesthetics company. Prior to that, from

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2004 to 2014, Ms. Gaeta held various positions at KPMG LLP, most recently as an Advisory Director in the Transactions & Restructuring Group. Ms. Gaeta received her Bachelor of Science, cum laude, from Loyola Marymount University.

Roberto De Mezerville . Mr. De Mezerville was appointed as our Chief Technology Officer in February 2018 and has held positions of increasing responsibility at our company since 2009 in the areas of quality management, research and development, regulatory and clinical affairs, and was our Vice President of Quality and R&D from June 2015 to February 2018. From 2006 to 2009, Mr. De Mezerville served in various engineering and quality management positions with Allergan Medical Costa Rica. He has a Bachelor’s Degree in Business Administration from Universidad Interamericana de Costa Rica and a Bachelor’s degree in Industrial Environmental Health and Safety Engineering from Instituto Tecnologico de Costa Rica.

Significant Employees

Jeremy Livianu . Mr. Livianu has been our General Counsel since April 2018. From February 2014 to March 2018, Mr. Livianu was the Global Director of Legal Affairs and Healthcare Compliance and Privacy Officer at Nevro Corp., a medical device company in Redwood City, California. From March 2010 to February 2014, Mr. Livianu supported Johnson & Johnson life science companies in their healthcare compliance Global Surgery Group. Mr. Livianu also served as Corporate Counsel for Tethys Bioscience and practiced intellectual property law at O’Melveny & Myers LLP and Paul, Hastings, Janofsky, & Walker LLP. Mr. Livianu received his J.D. with honors from The George Washington University Law School and his Bachelor of Science in Chemical Engineering from the University of California, San Diego.

Alberto Quesada . Mr. Quesada joined us in January 2017 as our Vice President of Quality and OUS Regulatory Affairs. From May 2010 to December 2016, Mr. Quesada was a Quality Director and Management Representative at Boston Scientific in Costa Rica, where he was a Quality Director at the company’s site in Heredia from May 2010 to June 2016, and then a Management Representative at the company’s site in Coyol from July 2016 to December 2016. Prior to that, Mr. Quesada was with Allergan Corporation from November 2000 to May 2010, where he served in senior quality management roles. He also previously held roles at Baxter Healthcare Corporation, Kativo Chemical Industries and GTE Sylvania. Mr. Quesada received his M.B.A. from Universidad Estatal a Distancia (UNED), Costa Rica and his undergraduate degree in Industrial Engineering from the University of Costa Rica.

Non-Employee Directors

Lisa N. Colleran . Ms. Colleran has served on our board of directors since November 2015. She served as Global President of LifeCell Corporation from August 2008 to January 2012 after the company was acquired by Kinetic Concepts, Inc. In January 2012, Ms. Colleran was appointed Chief Executive Officer and Director of LifeCell Corporation, a position she held until April 2013. Ms. Colleran originally joined LifeCell in 2002 as the Vice President of Marketing and Business Development and later served as Senior Vice President of Commercial Operations. Prior to joining LifeCell, Ms. Colleran spent 20 years at Baxter Healthcare Corporation in various sales, marketing, business development and general management roles with international experience. She was appointed Vice President, Marketing for Baxter's U.S. Renal business in 1997 and served in that role until 2001 when she was promoted to Vice President/General Manager of the company's Renal Pharmaceuticals business. Ms. Colleran received her Bachelor of Science from Molloy College and an M.B.A. from Loyola University of Chicago.

We believe Ms. Colleran is qualified to serve on our board of directors due to her years of international operational experience, including sales and marketing, surgeon education and new product launches, and her longitudinal experience at large, growing companies.

Ed Schutter . Mr. Schutter has served on our board of directors since January 2016. He has over thirty years of pharmaceutical industry experience and has served as the President and Chief Executive Officer of Arbor Pharmaceuticals, Inc. since April 2010. Prior to joining Arbor Pharmaceuticals, Mr. Schutter served in various roles at Sciele Pharma, Inc., a subsidiary of Shionogi & Co., Ltd., including as President and Chief Operating Officer from 2007 to 2009 and as Vice President of Global Business Development at Solvay S.A. in Basel, Switzerland from 2002 to 2006. He also held several senior management roles in commercial operations at the U.S. subsidiary of Solvay during his twenty years with the organization. Mr. Schutter began his pharmaceutical career with Reid-Provident Laboratories, Inc., a small entrepreneurial pharmaceutical company based in Atlanta, Georgia. He currently serves on the board of Knight Therapeutics, Inc., Vensun Pharmaceuticals, Inc., a privately held company, Mercer University and Georgia Bio, a privately held company. Mr. Schutter has a degree in Pharmaceutical Sciences from Mercer University and an M.B.A. from Kennesaw State University.

We believe Mr. Schutter is qualified to serve on our board of directors due to his experience as a chief executive officer and director in the health care industry.

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Allan Weinstein, M.D. Dr. Weinstein has served on our board of directors since January 2016. He is an independent entrepreneur focused on intellectual property in the life sciences and medical device industries. Currently, he is actively associated with the following companies: Chairman of Spiritus Pharmaceuticals, from 2012, a specialty pharmaceutical company devoted to improving the lives of those with respiratory diseases; Chairman of MinibarRx, LLC, from 2012 to 2017 until its acquisition, a privately held IoT platform company for managing vaccines and biologics with the foremost mission of disease prevention through increased vaccination rates; Chairman of ShareStream, from 2003, a leading online video platform and media-management solution provider for education worldwide; Chairman of InstantDx/OnCallData, from 2000, a pioneer in electronic prescribing and healthcare-transaction services; Chairman of Instant Medical Diagnostics, from 2008, a one-step rapid-diagnostic platform; and Co-founder of J-Med Pharmaceuticals, Inc., a 25-year-old privately held intellectual property pharmaceutical company, with a diversified patent portfolio that began with the licensing of both prescription and over-the-counter day/night (antihistamine/decongestant) products for cold, cough, and flu. In the past, Dr. Weinstein has served in academic functions including as an Assistant Clinical Professor of Medicine at Georgetown University and as a Consultant to the National Institutes of Health in Bethesda, Maryland, while practicing medicine in Washington, D.C. He received an A.B. in Biology from Lafayette College and an M.D. from the University of Kentucky. Dr. Weinstein is the author of the book Asthma: The Complete Guide to Self-Management of Asthma and Allergies for Patients and Their Families, published by McGraw-Hill and Random House. He is Board-certified in Internal Medicine and in Allergy and Clinical Immunology, and completed his medical training fellowship at National Jewish Health in Denver.

We believe Dr. Weinstein is qualified to serve on our board of directors due to his extensive experience in medicine, academics, research and at medical device companies.

David Hung, M.D . Dr. Hung has served on our board of directors since February 2016. He served as Chief Executive Officer of Axovant Biosciences Inc. from April 2017 to February 2018. He was a co-founder of Medivation, Inc. and served as President, Chief Executive Officer and director of its subsidiary, Medivation Neurology, Inc., from its inception in September 2003 until its acquisition by Medivation in December 2004, at which time he became President, Chief Executive Officer and director of Medivation. Dr. Hung served in those roles until Medivation was acquired by Pfizer, Inc. in September 2016. From 1998 to 2001, Dr. Hung served as Chief Scientific Officer (1998-1999) and as President, Chief Executive Officer and director (1999-2001) of Pro-Duct Health, Inc., a privately-held medical device company focused on breast cancer cytological diagnostics. From 1996 to 1998, Dr. Hung served in various senior positions at Chiron Corporation, most recently as Vice President of Lead Discovery and Development and Vice President of New Projects. Dr. Hung served as a member of the board of directors of Opexa Therapeutics, Inc., a biopharmaceutical company, from May 2006 to October 2011. Dr. Hung received an M.D. from the University of California, San Francisco, School of Medicine, and an A.B. in Biology from Harvard College.

We believe Dr. Hung is qualified to serve on our board of directors due to his extensive experience as a chief executive officer and director in the health care industry, including his oversight of the growth of a company from inception through its initial public offering to a multi-billion dollar market capitalization and sale.

Nicholas Lewin . Mr. Lewin has served on our board of directors since September 2015, and as Chairman since December 2017. He has been a Managing Partner at Crown Predator Holdings since 2000 and has been a private investor since 2000. He has invested across multiple industries, and throughout the capital structure, with a particular focus on companies with innovative technologies and strong intellectual property, including activist situations that require working with management. He has been a director of Halo Maritime Defense Systems, a privately held provider of maritime security product and solutions, since 2007, and Dura Medic, LLC a durable medical equipment provider, since 2006. Mr. Lewin holds a bachelor’s degree in Political Science from Johns Hopkins University.

We believe Mr. Lewin is qualified to serve on our board of directors due to his experience as an investor in, and director of, innovative companies, including health care companies.

Dennis Condon . Mr. Condon has served on our board of directors since December 2017. He was President and Chief Executive Officer of Merz Aethetics (formerly BioForm Medical) from July 2007 to January 2013. From March 2006 to May 2007, Mr. Condon was President and Chief Executive Officer of Aspara Medical, and was President and Chief Executive Officer of Reliant Technology from January 2005 to February 2006. Prior to joining Reliant Technology, Mr. Condon held various roles at Spa Medicus, The Plastic Surgery Company and Mentor Corporation. Mr. Condon holds a bachelor’s degree in Biological Science from University of California, Davis.

We believe Mr. Condon is qualified to serve on our board of directors due to his years of operational and executive leadership experience, and his experience at large, growing companies.

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Board Composition

Our business and affairs are managed under the direction of our board of directors, which currently consists of seven members including six non-employee directors and one executive director, our Chief Executive Officer, Juan Jose Chacon Quiros.

Following the completion of this offering, our amended and restated memorandum and articles of association will provide for a classified board of directors, with each director serving a staggered, three-year term. As a result, only one class of directors will be elected at each annual meeting of our shareholders, with the other classes continuing for the remainder of their respective three-year terms. The terms of the directors will expire upon the election and qualification of successor directors at the annual meeting of shareholders to be held during 2019 for the Class I directors, 2020 for the Class II directors and 2021 for the Class III directors. Our directors will be divided among the three classes as follows:


▪	the Class I directors will be and , and their terms will expire at the annual meeting of shareholders to be held in 2019;


▪	the Class II directors will be and , and their terms will expire at the annual meeting of shareholders to be held in 2020; and


▪	the Class III directors will be and , and their terms will expire at the annual meeti ng of shareholders to be held in 2021.

Upon expiration of the term of a class of directors, directors for that class will be elected for three-year terms at the annual meeting of shareholders in the year in which that term expires. Each director’s term shall continue until the election and qualification of his or her successor, or his or her earlier death, resignation or removal. Any additional directorships resulting from an increase in the number of authorized directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors.

The division of our board of directors into three classes with staggered three-year terms may delay or prevent a change of our management or a change of control. Under British Virgin Islands law and our amended and restated memorandum and articles of association, our directors may be removed for cause by the affirmative vote of the holders of a majority of our voting shares.

Director Independence

In connection with this offering, we intend to apply to list our common shares on the Nasdaq Capital Market, or Nasdaq. Under the listing requirements and rules of Nasdaq, independent directors must comprise a majority of a listed company’s board of directors within a specified period of time after this offering.

Our board of directors has undertaken a review of its composition, the composition of its committees, and the independence of each director. Based upon information requested from and provided by each director concerning his or her background, employment and affiliations, including family relationships, our board of directors has determined that Ms. Colleran, Drs. Hung and Weinstein and Messrs. Schutter and Condon have no relationships that would interfere with the exercise of independent judgment in carrying out the responsibilities of director and that each of these directors is “independent,” as that term is defined under the applicable rules and regulations of the Securities and Exchange Commission, or the SEC, and the listing requirements and rules of Nasdaq. In making this determination, our board of directors considered the current and prior relationships that each non-employee director has with our company, any other transactional relationships a non-employee director may have with our company, and all other facts and circumstances our board of directors deemed relevant in determining their independence, including the beneficial ownership of our capital shares held by each non-employee director and any of his and our respective affiliates.

Audit committee members must satisfy separate independence criteria set forth in Rule 10A-3, under the Exchange Act. To be considered independent for purposes of Rule 10A-3 and under the rules of Nasdaq, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, board of directors, or any other board committee: (1) accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries; or (2) be an affiliated person of the listed company or any of its subsidiaries.

Committee Independence Phase-In Provisions

Certain exemptions are available to us under the rules of Nasdaq and under Rule 10A-3 of the Exchange Act that allow companies a phase-in period for complying with committee independence requirements after an initial public offering. Under these exemptions, companies are permitted to phase in compliance with these rules and regulations as follows: (1) one member must satisfy the requirement at the time of listing; (2) a majority of members must satisfy the

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requirement within 90 days of listing; and (3) all members must satisfy the requirement within one year of listing. We intend to utilize these exemptions. Accordingly, you may not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements of Nasdaq or the Exchange Act.

There are no family relationships among any of our directors or executive officers.

Board Leadership Structure

Our board does not have a policy on whether the offices of Chairman of the Board and Chief Executive Officer should be separate and, if they are to be separate, whether the Chairman of the Board should be selected from among the independen t directors. Our board believes that it should have the flexibility to make these determinations at any given time in the way it believes best to provide appropriate leadership for us at that time. Our board has reviewed our current board leadership structure in light of the composition of the board, our size, the nature of our business, the regulatory framework under which we operates, and other relevant factors. Considering these factors, Mr. Chacon Quiros serves as our Chief Executive Officer, and Mr. Lewin serves as our Chairman and has authority, among other things, to preside over board of directors meetings, and to call special meetings of the board. However, no single leadership model is right for all companies and at all times. Our board of directors recognizes that depending on the circumstances, other leadership models might be appropriate in the future. As a result, our board of directors may periodically review its leadership structure.

Role of the Board in Risk Oversight

Our board of directors is primarily responsible for the oversight of our risk management activities and has delegated to the audit committee the responsibility to assist our board in this task. The audit committee also monitors our system of disclosure controls and procedures and internal control over financial reporting and reviews contingent financial liabilities. The audit committee, among other things, reviews and discusses with management reports regarding our enterprise risk management activities, including management’s assessment of our major risk exposures and the steps taken to monitor and manage those exposures.

While our board oversees our risk management, our management is responsible for day-to-day risk management processes. Our board of directors expects our management to consider risk and risk management in each business decision, to proactively develop and monitor risk management strategies and processes for day-to-day activities and to effectively implement risk management strategies adopted by the board of directors. We believe this division of responsibilities is the most effective approach for addressing the risks we face.

Board Committees

Our board of directors has the authority to appoint committees to perform certain management and administration functions. Our board of directors has an audit committee, a compensation committee and a nominating and corporate governance committee. The composition and responsibilities of each committee are described below. Members will serve on these committees until their resignation or until otherwise determined by our board of directors.

Audit Committee

Our audit committee consists of Ms. Colleran and Messrs. Schutter and Lewin, with Ms. Colleran serving as the committee chair. Each member of our audit committee can read and understand fundamental financial statements in accordance with audit committee requirements. In arriving at this determination, our board of directors has examined each audit committee member’s scope of experience and the nature of their employment in the corporate finance sector. Our board of directors has determined that each of Ms. Colleran and Messrs. Schutter and Lewin is an “audit committee financial expert” as defined by the rules promulgated by the SEC and satisfies the financial sophistication requirements of Nasdaq. The audit committee is responsible for, among other things:


▪	selecting and hiring our registered public accounting firm;


▪	evaluating the performance and independence of our registered public accounting firm;


▪	approving the audit and pre-approving any non-audit services to be performed by our registered public accounting firm;


▪	reviewing our financial statements and related disclosures and reviewing our critical accounting policies and practices;


▪	reviewing the adequacy and effectiveness of our internal control policies and procedures and our disclosure controls and procedures;


▪	overseeing procedures for the treatment of complaints on accounting, internal accounting controls or audit matters;

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▪	reviewing and discussing with management and the independent registered public accounting firm the results of our annual audit, our quarterly financial statements and our publicly filed reports; and


▪	reviewing and approving in advance any proposed related person transactions.

Compensation Committee

Our compensation committee consists of Messrs. Condon and Lewin and Dr. Weinstein, with Mr. Condon serving as the committee chair. The compensation committee is responsible for, among other things:


▪	reviewing and approving our Chief Executive Officer’s and other executive officers’ annual base salaries, incentive compensation plans, including the specific goals and amounts, equity compensation, employment agreements, severance arrangements and change in control agreements and any other benefits , compensation or arrangements;


▪	administering our equity compensation plans; and


▪	overseeing our overall compensation philosophy, compensation plans and benefits programs .

Nominating and Corporate Governance Committee

Our nominating and corporate governance committee consists of Dr. Hung, Ms. Colleran and Dr. Weinstein, with Dr. Hung serving as the committee chair. The nominating and corporate governance committee will be responsible for, among other things:


▪	evaluating and making recommendations regarding the composition, organization and governance of our board of directors and its committees;


▪	evaluating and making recommendations regarding the creation of additional committees or the change in mandate or dissolution of committees;


▪	reviewing and making recommendations with regard to our corporate governance guidelines and compliance with laws and regulations; and


▪	reviewing and approving conflicts of interest of our directors and corporate officers, other than related person transactions reviewed by the audit committee.

We intend to post the charters of our audit, compensation and nominating and corporate governance committees, and any amendments thereto that may be adopted from time to time, on our website at www.establishmentlabs.com. Information on or that can be accessed through our website is not part of this prospectus. Our board of directors may from time to time establish other committees.

Compensation Committee Interlocks and Insider Participation

None of the members of our compensation committee has ever been an officer or employee of us. None of our executive officers serve, or have served during the last fiscal year, as a member of a board of directors, compensation committee or other board committee performing equivalent functions of any entity that has one or more executive officers serving on our board directors or on our compensation committee.

A member of our board of directors and our compensation committee, Mr. Lewin, is affiliated with CPH TU, LP, which is a holder of more than 5% of our outstanding equity. CPH TU, LP purchased 1,646,714 shares of our ordinary shares for a total purchase price of $8,160,000 in August 2015 and, pursuant to a note and warrant purchase agreement, has been issued convertible promissory notes with an aggregate principal amount of $24.2 million as of August 24, 2017, including interest accrued on the convertible promissory notes since their issuance. Pursuant to an amendment to the note and warrant purchase agreement in September 2016, warrants that had been issued pursuant to the note and warrant purchase agreement were terminated. CPH had the option, at any time prior to the maturity date of September 1, 2017, to convert the convertible promissory notes held by CPH into our Class B common shares at a conversion price of $3.99 per share with respect to principal and $4.9143 per share with respect to accrued and unpaid interest. On August 24, 2017, CPH elected to convert the principal and the accrued interest outstanding into 5,869,417 shares of our Class B ordinary shares.

Code of Business Conduct and Ethics

We have adopted a code of business conduct and ethics that applies to all of our employees, officers and directors, including our Chief Executive Officer, Chief Financial Officer, and other executive and senior financial officers. Upon the completion of this offering, the full text of our code of business conduct and ethics will be available on the investor relations section of our website at www.establishmentlabs.com. We intend to post any future amendment to our code of business conduct and ethics, and any waivers of such code for directors and executive officers, on the same website. Information on or that can be accessed through our website is not part of this prospectus.

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Non-Employee Director Compensation

We do not currently have a formal policy with respect to compensating our non-employee directors for service as directors. During 2017, our non-employee directors did not receive any cash compensation. Our board of directors has, however, granted equity awards from time to time to non-employee directors as compensation for their service as directors. We also reimburse our non-employee directors for their reasonable out-of-pocket costs and travel expenses in connection with their service as members of our board of directors.

The table below shows the number of shares awarded as equity compensation to our non-employee directors to date:




Non-Employee Director	2016	2017
Lisa N. Colleran	36,780	—
Ed Schutter	36,780	—
Allan Weinstein	36,780	—
David Hung, M.D.	36,780	—
Nicholas Lewin	36,780	—
Dennis Condon	—	36,780

Following the completion of this offering, we will implement a formal policy pursuant to which our non-employee directors will be eligible to receive compensation for service on our board of directors and committees of our board of directors.

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EXECUTIVE COMPENSATION

Our named executive officers, or NEOs, for the year ended December 31, 2017, consisted of our chief executive officer and the next two most highly compensated executive officers, were:


▪	Juan Jose Chacon Quiros, our Founder and Chief Executive Officer;


▪	Salvador Dada Santos, our Chief Operating Officer; and


▪	Eddie De Oliveira, our Vice President of Sales, Brazil.

2017 Summary Compensation Table

The following table provides information regarding the total compensation for services rendered in all capacities that was or paid to our NEOs for the year ended December 31, 2017.




Name and Principal Position	Year	Salary		Non-equity Incentive Plan (2)		All Other Compensation	Total
Juan Jose Chacon Quiros	2017	$	295,773	$	—	27,688 ⁽³⁾	$	323,460
Chief Executive Officer
Salvador Dada Santos	2017	208,072 ⁽¹⁾		—		26,160 ⁽⁴⁾	234,232
Chief Operating Officer
Eddie De Oliveira	2017	212,580		82,781 ⁽²⁾		74,198 ⁽⁵⁾	369,559
Vice President of Sales, Brazil


(1)	Consists of $39,000 paid as an employee of Establishment Labs S.A., and the remainder paid for consultancy services to Establishment Labs Holdings Inc.


(2)	Consists solely of sales commissions paid upon the achievement of certain personal and Company performance objectives.


(3)	Comprised of a vehicle allowance in the aggregate amount of $16,835 and $10,853 for life insurance premiums.


(4)	Comprised of a vehicle allowance in the aggregate amount of $18,960 and $7,200 for life insurance premiums.


(5)	Comprised primarily of a housing allowance in the aggregate amount of $54,274 and a vehicle allowance in the aggregate amount of $12,392, as well as smaller payments for life insurance and vacation.

Outstanding Equity Awards at Fiscal 2017 Year-End

The following table sets forth information regarding outstanding equity awards held by our named executive officers as of December 31, 2017:




Named Executive Officer	Grant Date	Option Awards - Number of Securities Underlying Unexercised Options Exercisable (#)	Option Awards - Number of Securities Underlying Unexercised Options Unexercisable (#)	Option Awards - Option Exercise Price ($)	Option Awards - Option Expiration Date	Stock Awards - Number of Shares That Have Not Vested (#)	Stock Awards - Market Value of Shares or Units of Stock That Have Not Vested ($) (1)
Juan Jose Chacon Quiros	8/12/2016	—	—	—	—	85,815	874,456
Salvador Dada Santos	8/12/2016	—	—	—	—	42,915	437,304
Eddie De Oliveira	8/31/2016	17,621	19,159	4.11	8/31/2026	—	—


(1)	Stock award market value of shares or units of stock that have not vested is based on the estimated share value of $10.19 per share, as of December 31, 2017.

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Service Agreements

Juan Jose Chacon Quiros

In July 2016, we entered into an employment agreement with Mr. Chacon Quiros, our Chief Executive Officer. This employment agreement has no specific term but generally requires 30 days’ notice to terminate. This employment agreement provides for a base salary equivalent to $288,000 per year. Pursuant to this employment agreement, Mr. Chacon Quiros is eligible for annual incentive compensation up to 50% of his base salary upon achievement by Mr. Chacon Quiros and us of certain performance objectives. In the event that Mr. Chacon Quiros is not employed with us through the end of an applicable fiscal year, Mr. Chacon Quiros is eligible for a pro rata portion of such amount equal to the number of months that Mr. Chacon Quiros was employed with us in the applicable fiscal year divided by twelve.

Under the terms of his employment agreement, if Mr. Chacon Quiros’ employment is terminated by us without cause or by Mr. Chacon Quiros for good reason, Mr. Chacon Quiros will be eligible to receive the following benefits in exchange for a complete release of claims against us:


▪	severance payments equal to the amount of base salary paid to Mr. Chacon Quiros for the twelve month period preceding the termination date, payable over the twelve month period following the termination date in equal parts over the standard payroll pay periods;


▪	a pro rata portion of any annual incentive compensation accrued up to the termination date if the applicable goals and targets are actually achieved by us, payable within 90 days of the end of the applicable year; and


▪	continued health plan benefits for the 180-day period following his termination.

In August 2016, we granted Mr. Chacon Quiros 294,240 restricted common shares, of which 50% vested in September 2016, and the remainder of which vests in equal monthly installments over 36 months. In the event of a change in control during the vesting period, all of the restricted shares will immediately vest in full.

Salvador Dada Santos

In July 2016, Establishment Labs S.A., our wholly-owned subsidiary, entered into an employment agreement w ith Mr. Dada, our Chief Operating Officer. This employment agreement has no specific term but generally requires 30 days’ notice to terminate. This employment agreement provides for a base salary equivalent to $39,000 per year. This employment agreement also provides that Mr. Dada will receive $585 per month as advance severance.

Under the terms of his employment agreement, if Mr. Dada’s employment is terminated by Establishment Labs S.A. without cause or by Mr. Dada for good reason, Mr. Dada will be eligible to receive the following benefits in exchange for a complete release of claims against Establishment Labs S.A.:


▪	severance payments equal to the amount of base salary paid to Mr. Dada for the 3-month period preceding the termination date, payable over the 3-month period following the termination date in equal parts over the standard payroll pay periods; and


▪	continued health plan benefits for the 90-day period following his termination.

In July 2016, we entered into a consulting agreement with Mr. Dada. This consulting agreement has no specific term. The consulting agreement provides for a monthly consulting fee of $12,385 and an additional yearly payment of $12,385 that is payable in the first two weeks of December. Pursuant to this consulting agreement, Mr. Dada is eligible for annual incentive compensation up to $70,000 upon achievement by Mr. Dada and us of certain performance objectives.

In the event that Mr. Dada is not engaged through the end of an applicable year, Mr. Dada is eligible for a pro rata portion of such amount equal to the number of months that Mr. Dada provided services to us in the applicable year divided by twelve. Mr. Dada’s consulting agreement also provides that in the event the consulting agreement is terminated by us without cause or by Mr. Dada for good reason, subject to Mr. Dada providing a complete release of claims against us, Mr. Dada will be eligible to receive a pro-rata portion of any annual incentive compensation accrued up to the termination date if the applicable goals and targets are actually achieved by us, payable within 90 days of the end of the applicable fiscal year.

In August 2016, we granted Mr. Dada 147,120 restricted common shares, of which 50% vested in September 2016, and the remainder of which vests in equal monthly installments over 36 months. In the event of a change in control during the vesting period, all of the restricted shares will immediately vest in full.

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Eddie De Oliveira

In January 2016, Establishment Labs Produtos par Saude Ltda, our wholly-owned Brazil subsidiary, entered into an employment agreement with Mr. De Oliveira, our Vice President of Sales Brazil. This employment agreement has no specific term and provides for a base salary equivalent to Brazilian Real R$47,750 per month, or approximately US$13,370 per month. Pursuant to this employment agreement, Mr. De Oliveira is eligible for annual incentive compensation upon achievement by Mr. De Oliveira and us of certain performance objectives. In the event of termination without cause, Mr. De Oliveira is entitled to a dismissal indemnification, in addition to mandatory severance by law, in a gross amount equivalent to twelve monthly fix salaries at the time of termination. In addition, upon termination of Mr. De Oliveira’s employment for any reason, we will have the right to require him not to compete with us pursuant to the non-competition provision in the employment agreement for up to twelve months after his termination by paying him an amount equal to his last base salary for each month of non-competition.

In August 2016, we granted Mr. De Oliveira an option to purchase 36,780 Class A ordinary shares, of which 25% vested in January 2017, and the remainder of which vests in equal monthly installments over the following 36 months.

Benefits Under Applicable Laws

Costa Rican labor laws establish the payment of benefits in case of death, retirement or termination without cause. This compensation is calculated according to time served with us and the corresponding salary in the last six months of employment, and is equal to between 19.5 and 22 days salary for each year served, up to a maximum of 8 years.

Employee Benefit and Share Plans

2018 Equity Incentive Plan

Our board of directors adopted our 2018 Equity Incentive Plan, or our 2018 Plan, in 2018, and our shareholders approved the 2018 Plan, in 2018. The 2018 Plan will be effective on the business day immediately prior to the date of effectiveness of the registration statement of which this prospectus forms a part. Our 2018 Plan will provide for the grant of incentive share options, within the meaning of Section 422 of the Code, to our employees and any parent and subsidiary corporations’ employees, and for the grant of nonqualified share options, restricted shares, restricted share units, share appreciation rights, performance units and performance shares to our employees, directors and consultants and our parent and subsidiary corporations’ employees and consultants.

Authorized Shares. A total of common shares will be reserved for issuance pursuant to our 2018 Plan. In addition, the shares to be reserved for issuance under our 2018 Plan shall be increased by a number of shares equal to the number of Class A ordinary shares subject to awards granted under our 2015 Equity Incentive Plan, referred to as our 2015 Plan, that, after the date of effectiveness described above, expire or otherwise terminate without having been exercised in full and a number of shares equal to the number of Class A ordinary shares issued pursuant to awards granted under our 2015 Plan that, after the date of effectiveness described above, are forfeited to or repurchased by us (provided that the maximum number of shares that may be added to our 2018 Plan pursuant to this sentence is shares). The number of shares available for issuance under our 2018 Plan will also include an annual increase on the first day of each fiscal year beginning in fiscal 2019, equal to the least of:


▪	shares;


▪	% of the outstanding common shares as of the last day of the immediately preceding year; or


▪	such other amount as our board of directors may determine.

Shares issued pursuant to awards under our 2018 Plan that we repurchase or that are forfeited due to the failure to vest, shares subject to awards under our 2018 Plan that expire or become unexercisable without having been exercised in full or are surrendered under an exchange program, and shares used to pay the exercise price of an award or to satisfy the tax withholding obligations related to an award, will become available for future grant under our 2018 Plan. In addition, to the extent that an award is paid out in cash rather than shares, such cash payment will not reduce the number of shares available for issuance under our 2018 Plan.

Plan Administration. Our board of directors or one or more committees appointed by our board of directors will administer our 2018 Plan. In the case of awards intended to qualify as “performance-based compensation” within the meaning of Section 162(m) of the Code, such committee will consist of two or more “outside directors” within the meaning of Section 162(m) of the Code. In addition, to the extent we determine it is desirable to do so, we will structure transactions under our 2018 Plan to satisfy the requirements for exemption under Rule 16b-3 of the Exchange Act.

Subject to the provisions of our 2018 Plan, the administrator will have the power to administer the plan, including but not limited to, the power to interpret the terms of the 2018 Plan and awards granted thereunder; to create, amend and revoke

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rules relating to our 2018 Plan, including creating sub-plans; and to determine the terms of the awards, including the exercise price, the number of common shares subject to each such award, the exercisability of the awards, and the form of consideration, if any, payable upon exercise. The administrator will also have the authority to amend existing awards to reduce or increase their exercise price, to allow participants the opportunity to transfer outstanding awards to a financial institution or other person or entity selected by the administrator, and to institute an exchange program by which (i) outstanding awards may be surrendered or canceled in exchange for awards of the same type (which may have a higher or lower exercise price or different terms), awards of a different type and/or cash; (ii) participants may transfer outstanding awards to a financial institution or other person or entity selected by the administrator; and/or (iii) the exercise price of an outstanding award is increased or reduced.

Share Options. Share options may be granted under our 2018 Plan. The exercise price of share options granted under our 2018 Plan generally must be at least equal to the fair market value of our common shares on the date of grant. The term of an incentive share option may not exceed 10 years, except that with respect to any participant who owns more than 10% of the voting power of all classes of our outstanding shares, the term must not exceed five years and the exercise price must equal at least 110% of the fair market value on the grant date. The administrator will determine the methods of payment of the exercise price of an option. After the termination of service of an employee, director or consultant, he or she may exercise his or her option for the period of time stated in his or her award agreement. If his or her award agreement does not specify such a period, the option will remain exercisable for (i) twelve months following a termination due to death or disability or (ii) three months following any other termination of service. However, in no event may an option be exercised after the expiration of its term, except in certain circumstances where the exercise period is extended due to the exercise of the option being prevented by applicable laws.

Restricted Shares. Restricted shares may be granted under our 2018 Plan. Restricted share awards are grants of common shares that vest in accordance with terms and conditions established by the administrator. The administrator will determine the number of restricted shares granted to any employee, director or consultant and, subject to the provisions of our 2018 Plan, will determine the terms and conditions of such awards. The administrator may impose whatever conditions to vesting it determines to be appropriate. For example, the administrator may set restrictions based on the achievement of specific performance goals or continued service to us. The administrator, in its sole discretion, may accelerate the time at which any restrictions will lapse or be removed. Recipients of restricted share awards generally will have voting and dividend rights with respect to such shares upon grant without regard to vesting, unless the administrator provides otherwise. Restricted shares that do not vest are subject to our right of repurchase or forfeiture.

Restricted Share Units. Restricted share units may be granted under our 2018 Plan. Restricted share units are bookkeeping entries representing an amount equal to the fair market value of one of our common shares. Subject to the provisions of our 2018 Plan, the administrator will determine the terms and conditions of restricted share units, including the vesting criteria, which may include accomplishing specified performance criteria or continued service to us, and the form and timing of payment. The administrator will have the discretion to reduce or waive any vesting criteria.

Share Appreciation Rights. Share appreciation rights may be granted under our 2018 Plan. Share appreciation rights allow the recipient to receive the appreciation in the fair market value of our common shares between the exercise date and the date of grant. Subject to the provisions of our 2018 Plan, the administrator determines the terms of share appreciation rights, including when such rights become exercisable and whether to pay any increased appreciation in cash, common shares, or a combination of both. The per share exercise price of a share appreciation right will be no less than 100% of the fair market value per share on the date of grant, and share appreciation rights may not have a term exceeding ten years. After the termination of service of an employee, director or consultant, he or she may exercise his or her share appreciation right for the period of time stated in his or her award agreement. If his or her award agreement does not specify such a period, the share appreciation right will remain exercisable for (i) twelve months following a termination due to death or disability or (ii) three months following any other termination of service. However, in no event may a share appreciation right be exercised after the expiration of its term, except in certain circumstances where the exercise period is extended due to the exercise of the share appreciation right being prevented by applicable laws.

Performance Units and Performance Shares. Performance units and performance shares may be granted under our 2018 Plan. Performance units and performance shares are awards that will result in a payment to a participant only if performance goals established by the administrator are achieved or the awards otherwise vest. Performance units shall have an initial dollar value established by the administrator prior to the grant date. Performance shares shall have an initial value equal to the fair market value of our common shares on the grant date. The administrator may set performance objectives based on company-wide, divisional, business unit or individual performance goals, or any other basis the administrator determines in its discretion, which, depending on the extent to which they are met, will determine the number and/or the value of performance units and performance shares to be paid out to participants. After the grant of a performance unit or performance share, the administrator has the discretion to reduce or waive any

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performance criteria or other vesting provisions for such performance unit or performance share. The administrator, in its sole discretion, may pay earned performance units or performance shares in the form of cash, shares, or a combination of both.

Outside Directors. Our 2018 Plan will provide that all non-employee directors will be eligible to receive all types of awards, except for incentive share options, under our 2018 Plan. During any fiscal year, a non-employee director may not be granted (1) cash-settled awards with a grant date fair value (determined in accordance with U.S. generally accepted accounting principles) of more than $ , increased to $ in connection with his or her initial service, or (2) share-settled awards with a grant date fair value (determined in accordance with U.S. generally accepted accounting principles) of more than $ , increased to $ in connection with his or her initial service.

Non-Transferability. Unless the administrator provides otherwise, our 2018 Plan generally will not allow for the transfer of awards and only the recipient of an award may exercise an award during his or her lifetime.

Certain Adjustments. In the event of certain changes in our capitalization, to prevent diminution or enlargement of the benefits or potential benefits available under our 2018 Plan, the administrator will adjust the number and class of shares that may be delivered under our 2018 Plan; the number, class, and price of shares covered by each outstanding award; and the numerical share limits set forth in our 2018 Plan.

Dissolution or Liquidation . In the event of our proposed liquidation or dissolution, the administrator will notify participants as soon as practicable, and all awards will terminate immediately prior to the consummation of such proposed transaction.

Merger or Change in Control. Our 2018 Plan will provide that in the event of a merger or change in control, as defined under our 2018 Plan, each outstanding award will be treated as the administrator determines. The administrator is not required to treat all awards or participants similarly in the transaction.

If a successor corporation or its parent or subsidiary does not assume or substitute an equivalent award for any outstanding award, then such award will fully vest, all restrictions on such award will lapse, all performance goals or other vesting criteria applicable to such award will be deemed achieved at 100% of target levels, and such award will become fully exercisable, if applicable, for a specified period prior to the transaction. The award will then terminate upon the expiration of the specified period of time.

If an outside director’s awards are assumed and, on or following such assumption, his or her service as a director of ours or our successor for any reason other than a voluntary resignation that is not at the request of the acquirer, his or her options, restricted share units and share appreciation rights will vest fully and become immediately exercisable, all restrictions on his or her restricted shares will lapse, and all performance goals or other vesting requirements for his or her performance shares and units will be deemed achieved at 100% of target levels, and all other terms and conditions met.

Amendment, Termination. The administrator will have the authority to amend, suspend or terminate our 2018 Plan, provided such action does not impair the existing rights of any participant. Our 2018 Plan will automatically terminate in 2028, unless we terminate it sooner.

2018 Employee Share Purchase Plan

Prior to the effectiveness of this offering, our board of directors intends to adopt our 2018 Employee Share Purchase Plan, or our ESPP. If approved by our shareholders, we expect our ESPP to be effective on the business day immediately prior to the date of effectiveness of the registration statement of which this prospectus forms a part. Our ESPP includes a component that is intended to qualify as an “employee share purchase plan” under Section 423 of the Internal Revenue Code of 1986, as amended, referred to as the 423 Component, and a component that permits us to make offerings that do not comply with Section 423, referred to as the Non-423 Component. For purposes of this disclosure, a reference to the “ESPP” will mean the 423 Component. Unless determined otherwise by the administrator, only our non-U.S. subsidiaries designated by the administrator as eligible to participate in the ESPP will participate in a separate offering.

Authorized Shares . A total of common shares will be available for sale under our ESPP. The number of common shares available for sale under our ESPP also will include an annual increase on the first day of each fiscal year beginning in fiscal 2019, equal to the least of:


▪	shares;


▪	% of the outstanding common shares as of the last day of the immediately preceding fiscal year; or

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▪	such other amount as the administrator may determine.

Plan Administration . Our board of directors or a committee designated by our board of directors will administer the ESPP and have will have authority to administer the plan, such as full and exclusive authority to interpret the terms of our ESPP, delegate ministerial authority to any of our employees, designate separate offerings under the plan, designate subsidiaries and affiliates as participating in the 423 Component or the Non-423 Component, determine eligibility, adjudicate all disputed claims filed under our ESPP, and establish such procedures that it deems necessary for the administration of our ESPP (such as adopt procedures and sub-plans that are necessary or appropriate to permit the participation in our ESPP by employees who are foreign nationals or employed outside the United States , the terms of which sub-plans may take precedence over other provisions of our ESPP except with respect to our ESPP’s share reserve limits).

Eligibility . Generally, all of our employees will be eligible to participate if they are employed by us, or any participating subsidiary, for at least 20 hours per week and more than five months in any calendar year. However, an employee may not be granted rights to purchase common shares under our ESPP if such employee:


▪	immediately after the grant would own capital shares possessing 5% or more of the total combined voting power or value of all classes of our capital shares; or


▪	holds rights to purchase common shares under all of our employee share purchase plans that accrue at a rate that exceeds $25,000 worth of common shares for each calendar year.

Offering Periods and Purchase Periods . Our ESPP will provide for overlapping -month offering periods that are scheduled to start on the first trading day on or after and of each year and end on the first trading day on or after and of each year, except that (i) the first offering period will commence on the first trading day on or after the effective date of the registration statement of which this prospectus forms a part and will end on the first trading day on or after and (ii) the second offering period will commence on the first trading day on or after . The administrator may change the duration of future offering periods if the change is announced prior to the beginning of the first affected offering period.

Each offering period will include purchase periods, which will commence on and and end on and ; provided, however, that the first exercise date under the ESPP will be the first trading day on or after .

Contributions . Our ESPP will permit participants to purchase common shares through payroll deductions of up to % of their eligible compensation, which includes a participant’s base straight time gross earnings, commissions (to the extent such commissions are an integral, recurring part of compensation), payments for overtime but excludes of payments for incentive compensation, equity compensation and other similar compensation. The administrator may allow all employees participating in a separate offering to contribute amounts to our ESPP via cash, check or other means set forth in a participant’s subscription agreement prior to an exercise date in an offering period. If permitted by the administrator, a participant may decrease (but not increase) the rate of his or her contributions during an offering period.

Exercise of Purchase Right . Amounts deducted and accumulated by the participant will be used to purchase common shares at the end of each purchase period. A participant may purchase a maximum of common shares during a purchase period. The purchase price per share will be 85% of the lower of (i) the fair market value of a common share on the first trading day of the offering period or (ii) the fair market value of a common share on the exercise date of the purchase period. If the fair market value of our common shares on the exercise date of an offering period is less than the fair market value on the first trading day of that offering period, participants will be withdrawn from the current offering period following their purchase of shares of our common shares on the purchase date and will be automatically re-enrolled in a new offering period.

Non-Transferability . A participant may not transfer rights granted under our ESPP other than by will, the laws of descent and distribution or as otherwise provided under our ESPP.

Withdrawal . Participants may end their participation at any time during an offering period and will be paid their accrued contributions that have not yet been used to purchase shares of our common shares. Participation ends automatically upon termination of employment with us.

Certain Adjustments . In the event of certain changes in our capitalization as set forth in our ESPP, to prevent diminution or enlargement of the benefits or potential benefits available under our ESPP, the administrator will adjust the number and class of shares that may be delivered under our ESPP and/or the number, price of shares covered by each outstanding award, and the numerical share limits set forth in our ESPP.

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Dissolution or Liquidation . In the event of our proposed liquidation or dissolution, the offering period then in progress will be shortened, and a new exercise date occurring before the date of the proposed dissolution or liquidation, unless otherwise provided by the administrator. The administrator will notify each participant that the exercise date has been changed and that the participant’s option will be exercised automatically on the new exercise date unless prior to such date the participant has withdrawn from the offering period.

Merger or Change in Control . Our ESPP provides that in the event of a merger or change in control, as defined under our ESPP, a successor corporation may assume or substitute each outstanding purchase right. If the successor corporation refuses to assume or substitute for the outstanding purchase right, the offering period then in progress will be shortened, and a new exercise date will be set. The administrator will notify each participant that the exercise date has been changed and that the participant’s option will be exercised automatically on the new exercise date unless prior to such date the participant has withdrawn from the offering period.

Amendment; Termination . The administrator has the authority to amend, suspend or terminate our ESPP, except that, subject to certain exceptions described in our ESPP, no such action may adversely affect any outstanding rights to purchase common shares under our ESPP. Our ESPP will automatically terminate in 2038, unless we terminate it sooner.

2015 Equity Incentive Plan

In 2015, our board of directors adopted, and our shareholders approved, our 2015 Equity Incentive Plan, referred to as our 2015 Plan.

Authorized Shares. Our 2015 Plan will be terminated in connection with this offering and, accordingly, no shares will be available for issuance under our 2015 Plan after that time. Our 2015 Plan will continue to govern outstanding awards granted thereunder. A total of 2,650,000 Class A ordinary shares were reserved for issuance under our 2015 Plan. Our 2015 Plan provided for the grant of incentive share options, nonqualified share options, equity appreciation rights, restricted shares, restricted share units, performance awards, and other share-based awards. As of 2018 , options to purchase Class A ordinary shares remained outstanding, and Class A ordinary shares subject to outstanding restricted share units.

Plan Administration. Our board of directors or a committee appointed by the board of directors administers our 2015 Plan. Subject to the provisions of our 2015 Plan, the administrator is authorized to establish rules and regulations as it deems necessary or appropriate for the proper administration of the Plan and to make such determinations and interpretations and to take such action it deems necessary or advisable. The administrator may also implement an exchange program by which (i) outstanding awards may be surrendered or cancelled in exchange for awards of the same type (which may have a higher or lower exercise price or different terms), awards of a different type and/or cash; (ii) participants may transfer outstanding awards to a financial institution or other person or entity selected by the administrator; and/or (iii) the exercise price of an outstanding award is increased or reduced. All determinations and interpretations made by the administrator will be binding and conclusive on all participants and their legal representatives.

Share Options. The exercise price per share of all share options equals at least 100% of the fair market value per share of our Class A ordinary shares on the date of grant. The term of an option could not exceed 10 years. An incentive share option held by a participant who owned more than 10% of the total combined voting power of all classes of shares of ours, or any parent or subsidiary corporations of ours, could not have a term in excess of five years and must have an exercise price of at least 110% of the fair market value per share of our Class A ordinary shares on the date of grant. After the termination of a participant’s service, the participant may exercise his or her vested option for the period stated in his or her award agreement. The 2015 Plan requires that such period be no less than 30 days following a termination other than for cause (as defined in our 2015 Plan), death or disability or six months following a termination for death or disability. However, in no event may an option be exercised later than the expiration of its term. If a participant’s service is terminated for cause or the administrator determines that a participant, before or after termination, engaged in conduct that constitutes cause, then the option will be forfeited immediately.

Equity Appreciation Rights. Equity appreciation rights allowed the recipient to receive the appreciation in the fair market value of our Class A ordinary shares between the exercise date and the date of grant. The administrator determined the number of equity appreciation rights granted to any participant and the terms and conditions of such awards. The term of an equity appreciation right could not exceed ten years. After termination of service, the participant may exercise his or her vested equity appreciation right for the period stated in his or her award agreement. The 2015 Plan requires that such period be no less than 30 days following a termination other than for cause, death or disability or six months following a termination for death or disability. However, in no event may an equity appreciation right be exercised after the expiration of its term. Subject to the provisions of our 2015 Plan, the administrator determined the other terms of

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equity appreciation rights, including when such rights become payable, whether to pay any increased appreciation in cash or with Class A ordinary shares, or a combination thereof, and the applicable strike price for purposes of measuring appreciation.

Restricted Shares. The administrator determined the number of restricted shares granted to any participant and the terms and conditions of such awards. The administrator could impose whatever terms and conditions on restricted shares that it deemed appropriate, including restrictions on the sale or other disposition and restrictions requiring the forfeiture of shares upon termination of a participant’s service with us or our subsidiaries or affiliates before satisfying the vesting period determined by the administrator. The administrator determined whether a participant was entitled to receive dividends or vote with respect to restricted shares.

Restricted Share Units. Restricted share units are bookkeeping entries entitling a participant to receive Class A ordinary shares or cash after satisfying the period of service determined by the administrator. The administrator determined the number of Class A ordinary shares covered by each award of restricted share units. Subject to the provisions of our 2015 Plan, the administrator could impose other restrictions it deemed advisable or appropriate, including restrictions requiring the forfeiture of restricted share units upon termination of a participant’s service with us or our subsidiaries or affiliates before satisfying the specified period of service.

Other Share-Based Awards . Other share-based awards consisted of other types of equity-based or equity-related awards not otherwise in such amounts and subject to such terms and conditions, as the administrator determined. Such awards may have involved the transfer of actual Class A ordinary shares, or payment in cash or otherwise of amounts based on the value of Class A ordinary shares.

Performance Awards. Performance awards are awards that result in a payment to a participant depending on the extent to which performance goals set by the administrator are met. Performance awards could be granted in the form determined by the administrator, including cash, share options, restricted shares, restricted share units, or other share-based awards. The administrator determined the performance goals, which can be based upon company-wide, affiliate, divisional, project team, and/or individual performance. The administrator determined the number, amount and timing of performance awards, and whether performance awards would be paid in Class A ordinary shares or cash. The administrator and/or board of directors generally have the authority to make any adjustments to performance goals for a performance award it deems necessary or desirable.

Non- Transferability. Generally, our 2015 Plan does not allow for the transfer of awards and only the recipient of an award may exercise such award during his or her lifetime.

Repurchase of Shares. Upon termination of a participant’s employment or service, we generally will have the right to repurchase all or any of the Class A ordinary shares the participant received through awards under the 2015 Plan. The repurchase price will be the then-current fair market value of the shares, unless the participant is terminated for cause, in which case the repurchase will be the lesser of the fair market value of the shares as of the date of the participant’s termination or the exercise or purchase price of the shares.

Certain Adjustments. In the event of certain changes in our capitalization, the number, class, and price of shares covered by each outstanding award will be appropriately adjusted.

Change of Control. Our 2015 Plan provides that in the event of a change of control, as defined in our 2015 Plan, each outstanding award will be treated as determined by our board of directors or the administrator.

Amendment; Termination. Our board of directors may amend our 2015 Plan at any time. As noted above, in connection with this offering, our 2015 Plan will be terminated and no further awards will be granted thereunder. All outstanding awards under our 2015 Plan will continue to be governed by their existing terms.

Executive Incentive Compensation Plan

In December 2016, our Board adopted an Executive Incentive Compensation Plan, which we refer to as our Bonus Plan. Our Bonus Plan will allow its administrator to provide cash incentive awards to selected employees, including our NEOs, based upon performance goals established by the administrator. Pursuant to the Bonus Plan, the administrator, in its sole discretion, will establish a target award for each participant and a bonus pool, with actual awards payable from such bonus pool, with respect to the applicable performance period.

Under the Bonus Plan, the administrator, in its sole discretion, will determine the performance goals applicable to awards, which goals may include, without limitation, attainment of research and development milestones, bookings, business divestitures and acquisitions, cash flow, cash position, contract awards or backlog, customer renewals,

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customer retention rates from an acquired company, subsidiary, business unit or division, earnings (which may include earnings before interest and taxes, earnings before taxes, and net taxes), earnings per share, expenses, gross margin, growth in shareholder value relative to the moving average of the S&P 500 Index or another index, installs, internal rate of return, market share, net income, net profit, net sales, new product development, new product invention or innovation, number of customers, operating cash flow, operating expenses, operating income, operating margin, overhead or other expense reduction, product defect measures, product release timelines, productivity, profit, retained earnings, return on assets, return on capital, return on equity, return on investment, return on sales, revenue, revenue growth, sales results, sales growth, share price, time to market, total shareholder return, working capital, unadjusted or adjusted actual contract value, unadjusted or adjusted total contractual value, and individual objectives such as peer reviews or other subjective or objective criteria. As determined by the administrator, performance goals that include our financial results may be determined in accordance with GAAP, or such financial results may consist of non-GAAP financial measures and any actual results may be adjusted by the administrator for one-time items or unbudgeted or unexpected items and/or payments when determining whether the performance goals have been met. The goals may be on the basis of any factors the administrator determines relevant, and may be on an individual, divisional, business unit, segment, or company-wide basis. The performance goals may differ from participant to participant and from award to award.

The administrator may, in its sole discretion and at any time, increase, reduce or eliminate a participant’s actual award, or increase, reduce or eliminate the amount allocated to the bonus pool for a particular performance period. The actual award may be below, at or above a participant’s target award, in the administrator’s discretion. The administrator may determine the amount of any reduction on the basis of such factors as it deems relevant, and it is not required to establish any allocation or weighting with respect to the factors it considers.

Actual awards are paid in cash in a single lump sum as soon as practicable after the end of the performance period during which they are earned and after they are approved by the administrator, but in no event later than the later of March 15 of the following calendar year or the 15th day of the third month of the following fiscal year. Unless otherwise determined by the administrator, to earn an actual award, a participant must be employed by us (or an affiliate of ours) through the date the award is paid.

Our board of directors or the administrator, in their sole discretion, may alter, suspend, or terminate the Bonus Plan, provided such action does not, without the consent of the participant, alter or impair the rights or obligations under any award already earned by such participant.

Employee Benefit Plans

Our NEOs are eligible to participate in our employee benefit plans, including our medical, dental, vision, group life, and accidental death and dismemberment insurance plans, in each case, on the same basis as all of our other employees. We maintain a 401(k) plan for the benefit of our eligible employees, including our NEOs, as discussed in the section below titled “Employee Benefit Plans-401(k) Plan.”

401(k) Plan

We maintain a tax-qualified retirement plan, or our 401(k) plan, that provides eligible employees with an opportunity to save for retirement on a tax-advantaged basis. Participants are able to defer up their eligible compensation subject to applicable annual Internal Revenue Service limits. All participants’ interests in their deferrals are 100% vested when contributed. Our 401(k) plan permits us to make matching contributions and discretionary contributions to eligible participants.

Limitation on Liability and Indemnification Matters

The BVI Act and our amended and restated memorandum and articles of association provide for the indemnification of our directors against all losses or liabilities incurred or sustained by him or her as a director of our company in defending any proceedings, whether civil or criminal provided that this indemnity only applies if he or she acted honestly and in good faith with a view to our best interests and, with respect to any criminal action, he or she must have had no reasonable cause to believe his or her conduct was unlawful.

In addition to the indemnification required in our amended and restated memorandum and articles of association, we plan to enter into indemnification agreements with each of our current directors and officers before the completion of this offering. These agreements will provide indemnification for certain expenses and liabilities incurred in connection with any action, suit, proceeding, or alternative dispute resolution mechanism, or hearing, inquiry, or investigation that may lead to the foregoing, to which they are a party, or are threatened to be made a party, by reason of the fact that they are or were a director, officer, employee, agent, or fiduciary of our company, or any of our subsidiaries, by reason of any action or inaction by them while serving as an officer, director, agent, or fiduciary, or by reason of the fact that they were serving at our request as a director, officer, employee, agent, or fiduciary of another entity. In the case of an action or

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proceeding by, or in the right of, our company or any of our subsidiaries, no indemnification will be provided for any claim where a court determines that the indemnified party is prohibited from receiving indemnification. We believe that these article provisions and indemnification agreements are necessary to attract and retain qualified persons as directors and officers. We also maintain directors’ and officers’ liability insurance.

The limitation of liability and indemnification provisions in our amended and restated memorandum and articles of association may discourage shareholders from bringing a lawsuit against directors for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against directors and officers, even though an action, if successful, might benefit us and our shareholders. A shareholder’s investment may be harmed to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions. Insofar as we may provide indemnification for liabilities arising under the Securities Act to our directors, officers, and controlling persons pursuant to the foregoing provisions, or otherwise, we have been advised that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. There is no pending litigation or proceeding naming any of our directors or officers as to which indemnification is being sought, nor are we aware of any pending or threatened litigation that may result in claims for indemnification by any director or officer.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Other than compensation arrangements, we describe below transactions and series of similar transactions, since January 1, 2015, to which we were a party or will be a party, in which:


▪	the amounts involved exceeded or will exceed $120,000; and


▪	any of our directors, executive officers, or holders of more than 5% of our equity, or any member of the immediate family of the foregoing persons, had or will have a direct or indirect material interest.

Related Party Convertible Notes

Convertible Promissory Notes with CPH TU, LP

In August 2015, we issued $15.0 million in convertible promissory notes, or the CPH Notes, to CPH TU, LP, or CPH, pursuant to a Note and Warrant Purchase Agreement, or the Purchase Agreement. In January 2016, we amended the CPH Notes to increase the aggregate borrowing limit to $18.0 million, and, in July 2016, we further amended the CPH Notes to increase the aggregate borrowing limit to $19.8 million. The notes are collateralized by substantially all of our assets and bear interest at a simple rate of 10% per annum with a maturity date of September 1, 2017. Pursuant to the amendment to the Purchase Agreement entered into in September 2016, principal and accrued interest under the CPH Notes became convertible into our ordinary shares at the option of CPH at any time based on a price of $3.99 and $4.9143 per share, respectively. In addition, warrants to purchase ordinary shares were originally issued alongside the CPH Notes under the Purchase Agreement but were subsequently canceled. In addition, the amendment provided for the conversion of all interest due under the CPH Notes into a separate note. On August 24, 2017, CPH elected to convert the principal and the accrued interest outstanding under the CPH Notes into 5,869,417 shares of our Class B ordinary shares. CPH is a holder of more than 5% of our outstanding equity, and Nicholas Lewin is a managing partner of CPH and is the chairman of our board of directors.

Promissory Notes Held by Former Class Z Preferred Shareholders

In August 2015, we entered into agreements with all of the Class Z redeemable convertible preferred shareholders to exchange their outstanding shares and accumulated dividends for notes payable with a principal balance of $4.2 million . Per the original agreement, the notes bear interest at a simple rate of 7% per annum with the interest payments due annually starting March 30, 2017 and a note maturity date of March 31, 2020. Annual payments are due based on achievement of certain annual sales milestones beginning in March 2017. In March, 2017, we modified the agreement to defer the interest payments for an additional period, which will be thirty days after we successfully complete our planned IPO. Approximately $5.0 million of the net proceeds from this offering will be used to repay these amounts.




Name of Shareholder	Number of Class Z Preferred Shares	Total Purchase Price
Medical Device Holdings S.A.	858	$	501,577
Global Silicone SRL ⁽¹⁾	4,655	2,721,262
Premium Group Holdings LTD ⁽²⁾	1,199	700,922
Manuel Enrique Chacon Quiros ⁽³⁾	25	14,615
Salvador Dada Santos ⁽⁴⁾	66	38,583


(1)	Global Silicone SRL is a holder of more than 5% of our equity as of December 31, 2017. Olivier François Tourniaire, Sr., the father of one of our vice presidents of sales, exercises the voting and dispositive power over the shares owned by Global Silicone SRL.


(2)	Premium Group Holdings LTD is a holder of more than 5% of our equity as of December 31, 2017.


(3)	Dr. Chacon Quiros is the brother of our Chief Executive Officer.


(4)	Mr. Dada is our Chief Operating Officer.

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Madryn Credit Agreement

In August 2017, we entered into the Madryn Credit Agreement with Madryn and and a syndicate of lenders to borrow up to $55.0 million. See Management’s Discussion and Analysis, Indebtedness - Madryn Debt, for more information. As of March 31, 2018 there was an outstanding principal balance of $40.0 million borrowed under the Madryn Credit Agreement.

Products Sales to Herramientas Medicas, S.A.

During the years ended December 31, 2016 and 2017 , we recorded revenue of $0.6 million for product sales to Herramientas Medicas, S.A., a distribution company owned by a family member of our Chief Executive Officer, Juan Jose Chacon Quiros. During the three months ended March 31, 2017 and 2018 , the Company recorded revenue of $0.2 million and $0.3 million , respectively. Accounts receivable owed to us from this family member amounted to approximately $0.1 million and $0.2 million as of December 31, 2017 and March 31, 2018 , respectively.

Short-term Promissory Notes

In August 2016, we entered into a note purchase agreement to borrow $1.45 million for a period of 30 days via secured promissory notes. The interest rate on the notes was 10% per annum, and the notes were repaid in full in September 2016. In January 2017, we amended the note purchase agreement and issued secured promissory notes to borrow an additional $1.2 million. These promissory notes were repaid in January 2017 and April 2017. The interest rate on the notes was 10% per annum. The following table summarizes the total purchase price paid for such promissory notes by our related persons on each date:




Name of Shareholder	Total Purchase Price
Antoun Nabhan ⁽¹⁾	$	200,000
Juan Jose Chacon Quiros ⁽²⁾	250,000
CPH TU, LP ⁽³⁾	1,000,000
Juan Jose Chacon Quiros ⁽²⁾	200,000
CPT TU, LP ⁽³⁾	1,000,000


(1)	Mr. Nabhan was our Chief Financial Officer until May 2017.


(2)	Mr. Chacon Quiros is our Chief Executive Officer.


(3)	Nicholas Lewin is a managing partner of CPH TU, LP and is a member of our board of directors. CPH TU, LP is a holder of more than 5% of our equity as of March 31, 2018.

Consulting Agreements with Manuel Enrique Chacon Quiros

In May 2016, we entered into a scientific board advisory agreement with Dr. Manuel Enrique Chacon Quiros pursuant to which Dr. Chacon Quiros joined our Scientific Advisory Board, provides general scientific advice, and serves as a clinical investigator, among other services. In exchange for these services, Dr. Chacon Quiros was granted options to purchase 22,068 shares, vesting over four years in equal annual installments, provided that he continues to provide these services at such times. In September 2016, we entered into a separate agreement whereby Dr. Chacon Quiros will maintain his clinic in Costa Rica as a MotivaImagine Excellence Center and will host and train physicians in the use of our products in relevant procedures, among other services, in exchange for cash reimbursement of up to $4,500 per day that such services are rendered. Dr. Chacon Quiros is the brother of our Chief Executive Officer, Juan Jose Chacon Quiros. During the years ended December 31, 2016 and 2017, we paid Dr. Chacon Quiros $32,000 and $120,000 , respectively, for services rendered. During the three months ended March 31, 2017 and 2018, the Company paid Dr. Chacon Quiros approximately $30,000 and $38,000, respectively, for services rendered.

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Motiva Implants France Acquisition

In September 2016, we acquired all of the outstanding and issued shares of Motiva Implants France, a French private company in exchange for $0.1 million in cash and the assumption of all assets and liabilities. The distribution company was previously owned by Olivier Tourniare, our Vice President of Sales, Asia Pacific, Middle East and Africa, and one of our current shareholders.

Motiva Netherlands BV

During the year ended December 31, 2017, we recorded revenue of $0.3 million for product sales to Motiva Netherlands BV, a distribution company owned by Erick Vogelanzeng, our Vice President of Sales, Europe . Accounts payable due to this distribution company amounted to zero as of December 31, 2017.

Share Repurchases

In September 2016, we entered into a share repurchase agreement with Global Silicone SRL for the repurchase of 813,140 Class A ordinary shares owned by Global Silicone SRL in exchange for $3.7 million. In October 2016, we paid $2.0 million to Global Silicone to repurchase 440,040 Class A ordinary shares, and the remaining $1.7 million was paid in April 2017. In July 2017, we paid $2.8 million to repurchase an additional 406,570 Class A ordinary shares from Global Silicone SRL. Global Silicone SRL is a holder of more than 5% of our equity as of December 31, 2017. Olivier Francois Tourniaire, Sr., the father of one of our vice presidents of sales, exercises the voting and dispositive power over the shares owned by Global Silicone SRL.

Dividends

Holders of our ordinary shares are entitled to receive dividends, if any, as may be declared from time to time by our board of directors out of legally available funds. In accordance with our amended and restatedmemorandum and articles of association, upon the declaration and payment of consideration on Class Z preferred shares, certain holders of 2,173,663 ordinary shares had a preferential right to the same amount of consideration. In August 2015 in connection with the repurchase of Class Z preferred shares in exchange for a note payable, we accrued $0.6 million for consideration due to these certain ordinary shareholders in accordance with the right in effect at the time. We recorded this as an accrued liability in the consolidated balance sheets. As of December 31, 2015 the earned dividends had not been paid out to shareholders and was recorded as a accrued dividend payable on the consolidated balance sheet. In October 2016, we amended our memorandum and articles of association to remove the preferential rights of certain ordinary shareholders to receive distributions on their ordinary shares in advance of the preferred shares. As a result of the amendment to the memorandum and articles of association, we have de-recognized the accrued dividend payable on the consolidated balance sheet as of December 31, 2016. Because the transaction was between related parties, we recorded the reversal as a capital transaction through additional paid-in-capital on the consolidated balance sheet. We intend to seek a waiver of these rights from such shareholders, who are comprised of related parties CPH TU, LP, Sariel LLC, Global Silicone SRL, Florence Capital Advisors SPV, I LLC, and Madryn Health Partners LP, each of which are holders of 5% or more of our equity as of December 31, 2017. Nicholas Lewin, a member of our board of directors, is a managing partner at CPH with voting and dispositive power over the common shares owned by CPH. Olivier Tourniaire, Sr., the father of one of our vice presidents of sales, exercises the voting and dispositive power over the shares owned by Global Silicone SRL. Mr. Chacon Quiros, our Chief Executive Officer, is a shareholder of Sariel LLC and has voting and dispositive power over the common shares owned by Sariel LLC.

Indemnification Agreements

We have entered, and intend to continue to enter, into separate indemnification agreements with our directors and executive officers, in addition to the indemnification provided for in our amended and restated memorandum and articles of association. These agreements, among other things, require us to indemnify our directors and executive officers for certain expenses, including attorneys’ fees, judgments, fines and settlement amounts incurred by a director or executive officer in any action or proceeding arising out of their services as one of our directors or executive officers or as a director or executive officer of any other company or enterprise to which the person provides services at our request. For more information regarding these indemnification arrangements, see the section titled “Management - Limitation on Liability and Indemnification Matters.” We believe that these provisions in our amended and restated memorandum and articles of association and indemnification agreements are necessary to attract and retain qualified persons as directors and officers.

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successful, might benefit us and our shareholders. A shareholder’s investment may decline in value to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.

Employee Agreements

We have entered into employment agreements or offer letters and other arrangements containing compensation, termination and change of control provisions, among others, with certain of our executive officers as described in the section titled “Executive Compensation-Service Agreements” above.

Change in Control Arrangements

We have entered into change in control severance benefits arrangements with certain of our executive officers, as described in greater detail in the section titled “Executive Compensation-Named Executive Officer Employment Agreements.”

Policies and Procedures for Related Party Transactions

Effective upon the completion of this offering, we will have a formal written policy providing that our executive officers, directors, nominees for election as directors, beneficial owners of more than 5% of any class of our common shares and any member of the immediate family of any of the foregoing persons, is not permitted to enter into a related-party transaction with us without the consent of our audit committee, subject to the exceptions described below.

In approving or rejecting any such proposal, our audit committee is to consider the relevant facts and circumstances available and deemed relevant to our audit committee, including, whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances, and the extent of the related party’s interest in the transaction. Our audit committee has determined that certain transactions will not require audit committee approval, including certain employment arrangements of executive officers, director compensation, transactions with another company at which a related party’s only relationship is as a non-executive employee, director or beneficial owner of less than 10% of that company’s shares and the aggregate amount involved does not exceed $120,000 in any fiscal year, transactions where a related party’s interest arises solely from the ownership of our common shares, and all holders of our common shares received the same benefit on a pro rata basis and transactions available to all employees generally.

It is our intention to ensure that all future transactions between us and our officers, directors and principal shareholders and their affiliates, are approved by the audit committee of our board of directors and are on terms no less favorable to us than those that we could obtain from unaffiliated third parties.

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PRINCIPAL SHAREHOLDERS

The following table sets forth certain information with respect to the beneficial ownership of our common shares at June 5, 2018 and as adjusted to reflect the sale of common shares in this offering, for:


▪	each of our directors;


▪	each of our named executive officers;


▪	all of our current directors and executive officers as a group; and


▪	each person, or group of affiliated persons, who beneficially owned more than 5% of our common shares.

We have determined beneficial ownership in accordance with the rules of the SEC, and the information is not necessarily indicative of beneficial ownership for any other purpose. Except as indicated by the footnotes below, we believe, based on information furnished to us, that the persons and entities named in the table below have sole voting and sole investment power with respect to all common shares that they beneficially owned, subject to applicable community property laws.

Applicable percentage ownership is based on 15,726,479 common shares outstanding at June 5, 2018 . In computing the number of common shares beneficially owned by a person and the percentage ownership of such person, we deemed to be outstanding all common shares subject to options held by the person that are currently exercisable or exercisable within 60 days of June 5, 2018 . However, we did not deem such shares outstanding for the purpose of computing the percentage ownership of any other person. In computing the number of common shares beneficially owned by a person and the percentage ownership of such person, we included shares owned by a spouse, minor children and relatives sharing the same home, as well as other entities owned or controlled by the named person.

Unless otherwise indicated, the address of each beneficial owner listed in the table below is c/o Establishment Labs Holdings Inc., P.O. Box 3140, Commerce House, Wickhams Cay 1, Road Town, Tortola VG1110, British Virgin Islands.




	Shares Beneficially Owned Prior to the Offering		Shares Beneficially Owned After the Offering ⁽¹⁴⁾
Name of Beneficial Owner	Number of Shares	%	Number of Shares	%
Greater than 5% Shareholders
CPH TU, LP ⁽¹⁾	7,516,131	47.79
Sariel LLC ⁽²⁾	1,128,264	7.17
Kilowatt Capital Funds ⁽³⁾	894,999	5.69
Global Silicone SRL ⁽⁴⁾	813,140	5.17

Named Executive Officers and Directors:
Juan Jose Chacon Quiros ⁽⁵⁾	1,365,290	8.68
Salvador Dada Santos ⁽⁶⁾	118,513	*
Eddie De Oliveira ⁽⁷⁾	28,233	*
Dennis Condon	—	*
Ed Schutter ⁽⁸⁾	24,520	*
David Hung, M.D. ⁽⁹⁾	24,520	*
Lisa N. Colleran ⁽¹⁰⁾	50,752	*
Allan Weinstein ⁽¹¹⁾	24,520	*
Nicholas Lewin ⁽¹²⁾	7,540,651	47.95
All current directors and executive officers as a group (10 Persons)	9,176,999	58.35


*	Represents beneficial ownership of less than one percent (1%).

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(1)

The business address of CPH TU, LP, or CPH, is Corporation Service Company, 2711 Centerville Road, Suite 400, Wilmington DE 19808. Nicholas Lewin is a managing partner at CPH with voting and dispositive power over the common shares owned by CPH as described in footnote (12) below. The underlying beneficial owners of the common shares held by CPH that own more than 5% of our shares prior to the Offering on an as-if CPH distributed basis as of June 5, 2018, are as follows: (a) Crown Predator Holdings, LLC, an affiliate of CPH, owning 5.07% of our outstanding shares beneficially owned prior to the Offering; (b) Perceptive Life Sciences Master Fund Ltd. owning 5.12% of our outstanding shares beneficially owned prior to the Offering; and (c) JW Partners, LP and JW Opportunities, LLC owning 20.48% of our outstanding shares beneficially owned prior to the Offering .


(2)	The business address for Sariel LLC is Ajeltake Road, Ajeltake Island, Majuro MH 96960, Marshall Islands .


(3)	Consists of (a) 63,200 Class A Ordinary Shares held by KW-Venus II, LP, (b) 536,000 Class D Ordinary Shares held by KW-Venus II, LP, (c) 17,699 Class D Ordinary Shares held by Fifth Set Ventures LLC, and (d) 278,100 Class E Ordinary Shares held by KW-Venus II, LP. The business address for Kilowatt Capital Funds is 580 California Street, Suite 2040, San Francisco, California 94104.


(4)	The business address of Global Silicone SRL is Santa Ana, Via Lindora Business Center, 4th floor, Radial Santa Ana, San Antonio de Belén, Kilometer 3, Costa Rica, San José. Olivier Tourniaire, Sr., the father of one of our vice presidents of sales, exercises the voting and dispositive power over the shares owned by Global Silicone SRL.


(5)	Consists of (a) 237,026 restricted common shares held by Mr. Chacon Quiros, and (b) 1,128,264 common shares held by Sariel LLC. Mr. Chacon Quiros, our Chief Executive Officer, is a shareholder of Sariel LLC and has voting and dispositive power over the common shares owned by Sariel LLC.


(6)	Consists of 118,513 restricted common shares.


(7)	Consists of (a) 22,987 common shares issuable pursuant to outstanding share options exercisable within 60 days of June 5, 2018 and (b) 5,246 Class C Ordinary Shares.


(8)	Consists of 21,455 common shares issuable pursuant to outstanding share options exercisable within 60 days of June 5, 2018.


(9)	Consists of 24,520 common shares issuable pursuant to outstanding share options exercisable within 60 days of June 5, 2018.


(10)	Consists of 24,520 common shares issuable pursuant to outstanding share options exercisable within 60 days of June 5, 2018.


(11)	Consists of 24,520 common shares issuable pursuant to outstanding share options exercisable within 60 days of June 5, 2018.


(12)	Consists of (a) the shares held by CPH described in footnote (1) above because Mr. Lewin is a member of our board of directors and is a managing partner at CPH with voting and dispositive power over the common shares owned by CPH, and (b) 24,520 common shares issuable pursuant to outstanding share options exercisable within 60 days of June 5, 2018.

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DESCRIPTION OF SHARE CAPITAL

General

We are incorporated as a British Virgin Islands company, and our affairs are governed by our amended and restated memorandum and articles of association and the laws of the British Virgin Islands.

The following description summarizes the most important terms of our share capital, as they are expected to be in effect upon the closing of this offering. We will adopt amended and restated memorandum and articles of association in connection with this offering, and this description summarizes the provisions that are included therein. Because it is only a summary, it does not contain all the information that may be important to you. For a complete description of the matters set forth in “Description of Share Capital,” you should refer to our amended and restated memorandum and articles of association, which are included as exhibits to the registration statement of which this prospectus forms a part.

Immediately prior to the completion of this offering, all of our outstanding ordinary shares will convert into common shares based on the consent of each holder of our outstanding ordinary shares, which we have obtained. Our common shares will have the rights and restrictions described below.

Key Provisions of our Amended and Restated Memorandum and Articles of Association and British Virgin Islands Law Affecting our Common Shares

The following are summaries of material terms and provisions of our amended and restated memorandum and articles of association and the BVI Business Companies Act, or the BVI Act, insofar as they relate to the material terms of our common shares. Unless otherwise stated, the following summaries are of the terms of our share capital upon closing of this offering. This summary is not intended to be complete, and you should read the forms of our amended and restated memorandum and articles of association, which will be filed as an exhibit to our registration statement on Form S-1.

Meetings of Shareholders

If our shareholders want us to hold a meeting of our shareholders, they may requisition the directors to hold one upon the written request of shareholders entitled to exercise at least 30% of the voting rights in respect of the matter for which the meeting is requested. Under British Virgin Islands law, we may not increase the required percentage to call a meeting above 30%.

Subject to our amended and restated memorandum and articles of association, a meeting of our shareholders will be called by not less than seven days’ notice in writing. Notice of every meeting of shareholders will be given to all of our shareholders. However, the inadvertent failure of the convener or conveners of a meeting of shareholders to give notice of the meeting to a shareholder, or the fact that a shareholder has not received the properly given notice, does not invalidate the meeting.

A meeting may be called by shorter notice than that mentioned above, but, subject to our amended and restated memorandum and articles of association, it will be deemed to have been duly called if shareholders holding at least 90% of the total voting rights on all the matters to be considered at the meeting have waived notice of the meeting and, for this purpose, the presence of a shareholder at the meeting shall constitute a waiver in relation to all the shares which that shareholder holds.

A meeting of shareholders is duly constituted if, at the commencement of the meeting, there are present in person or by proxy not less than 50% of the votes of the shares entitled to vote at the meeting. A quorum may be comprised of a single shareholder or proxy and then such person may pass a Resolution of Shareholders and a certificate signed by such person accompanied where such person is a proxy by a copy of the proxy instrument shall constitute a valid Resolution of Shareholders.

Voting Rights

Under the BVI Act, the common shares are deemed to be issued when the name of the shareholder is entered in our register of members. Our register of members will be maintained by our transfer agent, , which will enter the name of our shareholders in our register of members on the closing of the offering. If (a) information that is required to be entered in the register of shareholders is omitted from the register or is inaccurately entered in the register, or (b) there is unreasonable delay in entering information in the register, a shareholder of ours, or any person who is aggrieved by the omission, inaccuracy or delay, may apply to the British Virgin Islands courts for an order that the register be rectified, and the court may either refuse the application or order the rectification of the register, and may direct us to pay all costs of the application and any damages the applicant may have sustained.

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Subject to any rights or restrictions attached to any shares, at any general meeting on a show of hands every shareholder of record who is present in person (or, in the case of a shareholder being a corporation, by its duly authorized representative) or by proxy shall have one vote and on a poll every shareholder present in person (or, in the case of a shareholder being a corporation, by its duly appointed representative) or by proxy shall have one vote for each share which such shareholder is the holder. Voting at any meeting of the shareholders is by show of hands unless a poll is demanded. A poll may be demanded by shareholders present in person or by proxy if the shareholder disputes the outcome of the vote on a proposed resolution and the chairman shall cause a poll to be taken.

No shareholder shall be entitled to vote or be reckoned in a quorum, in respect of any share, unless such shareholder is registered as our shareholder at the applicable record date for that meeting. Shareholders of record may also pass written resolutions without a meeting.

There is nothing under the laws of the British Virgin Islands which specifically prohibits or restricts the creation of cumulative voting rights for the election of our directors, but cumulative voting for the election of directors is permitted only if expressly provided for in the memorandum or articles of association. We have not made provisions in our amended and restated memorandum and articles of association for cumulative voting for such elections.

Protection of Minority Shareholders

Under the laws of the British Virgin Islands, there is little statutory law for the protection of minority shareholders other than the provisions of the BVI Act dealing with shareholder remedies. One protection under statutory law is that shareholders may bring an action to enforce the BVI Act or our amended and restated memorandum and articles of association. Shareholders are entitled to have our affairs conducted in accordance with the BVI Act and the amended and restated memorandum and articles of association.

There are common law rights for the protection of shareholders that may be invoked, largely dependent on English common law, since the common law of the British Virgin Islands is limited. Under the general rule pursuant to English common law known as the rule in Foss v. Harbottle, a court will generally refuse to interfere with the management of a company at the insistence of a minority of its shareholders who express dissatisfaction with the conduct of our affairs by the majority or the board of directors. However, every shareholder is entitled to have our affairs conducted properly according to British Virgin Islands law and our constituent documents. As such, if those who control the company have disregarded the requirements of applicable law or the provisions of our amended and restated memorandum and articles of association, then the courts may grant relief. Generally, the areas in which the courts will intervene are the following: (1) an act complained of which is illegal; (2) acts that constitute oppression, unfair discrimination or unfair prejudice against the minority; (3) acts that infringe or are about to infringe on the personal rights of the shareholders, such as the right to vote; and (4) where we have not complied with provisions requiring approval of a special or extraordinary majority of shareholders, which are more limited than the rights afforded minority shareholders under the laws of many states in the United States .

Preemption Rights

British Virgin Islands law does not make a distinction between public and private companies and some of the protections and safeguards (such as statutory preemption rights, save to the extent that they are expressly provided for in our amended and restated memorandum and articles of association) that investors may expect to find in relation to a public company are not provided for under British Virgin Islands law. There are no preemption rights applicable to the issuance of new shares under either British Virgin Islands law or our amended and restated memorandum and articles of association.

Liquidation Rights

As permitted by British Virgin Islands law and our amended and restated memorandum and articles of association, we may be voluntarily liquidated under Part XII of the BVI Act by resolution of directors and resolution of shareholders if our assets are greater than our liabilities and we are able to pay our debts as they fall due.

Modification of Rights

As permitted by British Virgin Islands law, and our amended and restated memorandum and articles of association, if our shares are divided into more than one class of shares, we may vary the rights attached to any class only with the consent in writing of or by a resolution passed at a meeting by the holders of not less than 50% of the issued shares of that class.

Transfer of Shares

Subject to any applicable restrictions set forth in our amended and restated memorandum and articles of association, any of our shareholders may transfer all or any of his or her shares by a written instrument of transfer in the usual or common form or in any other form which our directors may approve.

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Our board of directors may, in its absolute discretion, resolve to refuse or delay the registration of any transfer of any share without assigning any reasons therefor. If our directors refuse or delay the registration of a transfer they shall, as soon as practicable, send to each of the transferor and the transferee notice of such refusal or delay in the agreed form.

Share Repurchase

As permitted by the BVI Act and our amended and restated memorandum and articles of association, shares may be repurchased, redeemed or otherwise acquired by us.

Registration Rights

Shareholder Registration Rights

We are party to an investor rights agreement which provides that certain holders have certain registration rights with respect to their ownership of ordinary shares and ordinary shares currently subject to outstanding warrants and options, with such rights as set forth below. The registration of common shares pursuant to the exercise of registration rights described below would enable the holders to sell these shares without restriction under the Securities Act, when the applicable registration statement is declared effective. We will pay the registration expenses, other than underwriting discounts and commissions, of the shares registered pursuant to the demand, piggyback and Form S-3 registrations described below.

Warrantholder Registration Rights

In connection with the Note and Warrant Purchase Agreement we entered with CPH , we issued warrants to purchase an aggregate of 145,000 ordinary shares. To the extent these warrants are outstanding at the time we complete an initial public offering, such warrants provide the holders with certain registration rights with respect to their ownership of the warrants.

Generally, in an underwritten offering, the managing underwriter, if any, has the right, subject to specified conditions, to limit, or exclude entirely, the number of shares such holders may include. The demand, piggyback and Form S-3 registration rights described below terminate upon the earliest to occur of: (i) the date that is five years after the closing of this offering; (ii) with respect to each shareholder, at such time as all such shares can be sold in a three-month period without registration in compliance with Rule 144; (iii) with respect to each shareholder, the date that the shareholder no longer holds any shares that carry these registration rights; (iv) following termination of the investor rights agreement; or (v) the closing of a Deemed Liquidation Event, as such term is defined in our amended and restated memorandum and articles of association.

Demand Registration Rights

As of June 5, 2018 , the holders of an aggregate of 14,158,113 common shares, issuable upon the conversion of outstanding ordinary shares and ordinary shares currently subject to outstanding warrants and options, will be entitled to certain demand registration rights. At any time beginning six months after the closing of our initial public offering, the holders of a majority of these shares may, on not more than one occasion, request that we file a registration statement having an aggregate offering price to the public of not less than $5,000,000 to register all or a portion of their shares.

Piggyback Registration Rights

As of June 5, 2018 , the holders of an aggregate of 14,158,113 common shares, issuable upon the conversion of outstanding ordinary shares and ordinary shares currently subject to outstanding warrants and options, were entitled to, and the necessary percentage of holders waived, their rights to include their shares of registrable securities in this offering. In the event that we propose to register any of our securities under the Securities Act, either for our own account or for the account of other security holders, the holders of these shares will be entitled to certain “piggyback” registration rights allowing them to include their shares in such registration, subject to certain marketing and other limitations. As a result, whenever we propose to file a registration statement under the Securities Act, including a registration statement on Form S-3 as discussed below, other than with respect to a demand registration or a registration statement on Forms S-4 or S-8, the holders of these shares are entitled to notice of the registration and have the right, subject to limitations that the underwriters may impose on the number of shares included in the registration, to include their shares in the registration. However, in no event shall the amount of securities of the selling shareholders included in the offering be reduced below twenty percent of the total amount of securities included in such offering, unless the offering is the initial public offering of our securities, in which case all shares may be excluded entirely.

Form S-3 Registration Rights

As of June 5, 2018 , the holders of an aggregate of 14,158,113 common shares, issuable upon the conversion of outstanding ordinary shares and ordinary shares currently subject to certain outstanding warrants and options, will be entitled to certain Form S-3 registration rights, provided that we have not already effected two such registrations within

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the twelve-month period preceding the date of such request. Such holders may make a request that we register their shares on Form S-3 if we are qualified to file a registration statement on Form S-3. Such request for registration on Form S-3 must cover securities the aggregate offering price of which is at least $3,000,000.

Dividends

Subject to the BVI Act and our amended and restated memorandum and articles of association, our directors may, by resolution, authorize a distribution to shareholders at such time and of such an amount as they think fit, if they are satisfied, on reasonable grounds, that, immediately after the distribution, we will satisfy the ‘solvency test’. A company will satisfy the solvency test if (i) the value of our assets exceeds our liabilities; and (ii) we are able to pay our debts as they fall due. Where a distribution is made to a shareholder at a time when we did not, immediately after the distribution, satisfy the solvency test, it may be recovered by the company from the shareholder unless (i) the shareholder received the distribution in good faith and without knowledge of our failure to satisfy the solvency test; (ii) the shareholder has altered his position in reliance on the validity of the distribution; and (iii) it would be unfair to require repayment in full or at all.

Board of Directors

We are managed by a board of directors which currently consists of seven directors. Our amended and restated memorandum and articles of association provide that upon the closing of this offering the board of directors shall consist of not less than seven directors.

There are no share ownership qualifications for directors.

Meetings of our board of directors may be convened at any time deemed necessary by any of our directors.

A meeting of our board of directors will be competent to make lawful and binding decisions if at least a majority of the directors are present or represented. At any meeting of our directors, each director, whether by his or her presence or by his or her alternate, is entitled to one vote.

Questions arising at a meeting of our board of directors are required to be decided by simple majority votes of the directors present or represented at the meeting. In the case of a tie vote, the chairman of the meeting shall have a second or deciding vote. Our board of directors may also pass unanimous written resolutions without a meeting.

The remuneration to be paid to the directors shall be such remuneration as the directors shall determine. Under our amended and restated memorandum and articles of association, the independent directors shall also be entitled to reimbursement of out-of-pocket expenses in connection with the performance of his or her duties as director.

Staggered Board of Directors

Our amended and restated memorandum and articles of association will provide for a staggered board of directors consisting of three classes of directors. Directors of each Class are chosen for three year terms upon the expiration of their current terms and each year one class will be elected by our shareholders.

The terms of the Class I, Class II and Class III directors will expire in 2019, 2020 and 2021, respectively. Beginning in 2019, our shareholders will elect directors for three-year terms upon the expiration of their current terms. Our shareholders will elect only one class of directors each year. We believe that classification of our board of directors will help to ensure the continuity and stability of our business strategies and policies as determined by our board of directors. There is no cumulative voting in the election of directors. As such, this classified board provision could have the effect of making the replacement of incumbent directors more time-consuming and difficult. At least two annual meetings of shareholders, instead of one, will generally be required to effect a change in a majority of our board of directors. Thus, the classified board provision could increase the likelihood that incumbent directors will retain their positions. The staggered terms of directors also may delay, defer or prevent a tender offer or an attempt to change control of us, even though a tender offer or change in control might be believed by our shareholders to be in their best interest.

Duties of Directors

British Virgin Islands law provides that each of our directors, in exercising his powers or performing his duties, shall act honestly and in good faith and in what the director believes to be in the best interests of the company. Additionally, the director shall exercise the care, diligence, and skill that a reasonable director would exercise in the same circumstances taking into account the nature of the company, the nature of the decision and the position of the director and his responsibilities. In addition, British Virgin Islands law provides that a director shall exercise his powers as a director for a

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proper purpose and shall not act, or agree to the company acting, in a manner that contravenes British Virgin Islands law or the memorandum or articles of association of the company.

Issuance of Additional Ordinary Shares

Our amended and restated memorandum and articles of association authorize our board of directors to issue additional common shares from time to time as our board of directors shall determine, to the extent of available authorized but unissued shares.

Changes in Authorized Shares

We are authorized to issue an unlimited number of common shares which will be subject to the same provisions with reference to the payment of calls, lien, transfer, transmission, forfeiture and otherwise as the shares in issue. We may by resolution:


▪	combine all of our shares into shares of larger par value than our existing shares;


▪	divide all of our shares into shares of smaller par value than our existing shares; or


▪	create new classes of shares with preferences to be determined by the board of directors at the time of authorizati on.

Inspection of Books and Records

Under British Virgin Islands law holders of our common shares will be entitled, on giving written notice to us, to inspect and make copies or take extracts of our: (a) amended and restated memorandum and articles of association; (b) register of shareholders; (c) register of directors; and (d) minutes of meetings and resolutions of shareholders and those classes of shareholders of which he is a shareholder.

Subject to our amended and restated memorandum and articles of association, our directors may, if they are satisfied that it would be contrary to our interest to allow a shareholder to inspect any document, or part of a document as referenced in (b), (c) or (d) above, refuse to permit the shareholder to inspect the document or limit the inspection of the document, including limiting the making of copies or the taking of extracts from the records. Where our directors exercise their powers in these circumstances, they shall notify the shareholder as soon as reasonably practicable.

Differences in Corporate Law

We were incorporated under, and are governed by, the laws of the British Virgin Islands. The flexibility available under British Virgin Islands law has enabled us to adopt the amended and restated memorandum and articles of association that will provide shareholders with rights that do not vary in any material respect from those they enjoyed under the Delaware Corporate Law.

Conflicts of Interest

Pursuant to the BVI Act and our amended and restated memorandum and articles of association, a director of a company who has an interest in a transaction and who has declared such interest to the other directors, may:


▪	vote on a matter relating to the transaction;


▪	attend a meeting of directors at which a matter relating to the transaction arises and be included among the directors present at the meeting for the purposes of a quorum; and


▪	sign a document on our behalf, or do any other thing in his capacity as a director, that relates to the transaction.

Anti-money Laundering Laws

In order to comply with legislation or regulations aimed at the prevention of money laundering we may require subscribers to provide evidence to verify their identity.

We reserve the right to request such information as is necessary to verify the identity of a subscriber. In the event of delay or failure on the part of the subscriber in producing any information required for verification purposes, we may refuse to accept the application, in which case any funds received will be returned without interest to the account from which they were originally debited.

If any person resident in the British Virgin Islands knows or suspects that another person is engaged in money laundering or terrorist financing and the information for that knowledge or suspicion came to their attention in the course of their business, the person will be required to report his belief or suspicion to the Financial Investigation Agency of the British Virgin Islands, pursuant to the Proceeds of Criminal Conduct Act 1997 (as amended). Such a report shall not be treated

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as a breach of confidence or of any restriction upon the disclosure of information imposed by any enactment or otherwise.

Anti-takeover Provisions

The BVI Act does not prevent companies from adopting a wide range of defensive measures, such as staggered boards, blank check preferred shares, removal of directors only for cause and provisions that restrict the rights of shareholders to call meetings and submit shareholder proposals. Our amended and restated memorandum and articles of association contain the following provisions which may be regarded as defensive measures: (i) a requirement of the affirmative vote of two-thirds or more of the shares entitled to vote on special matters such as mergers or acquisitions; (ii) the prevention of ‘‘business combinations’’ with ‘‘interested shareholders’’ for a period of three years after the date of the transaction in which the person became an interested shareholder, unless the business combination is approved in accordance with our amended and restated memorandum and articles of association by a general meeting of our shareholders or satisfies other requirements specified in our amended and restated memorandum and articles of association; (iii) directors’ ability, in their absolute discretion, to decline to register any transfer of shares without assigning any reason; (iv) our board of directors’ ability to issue, from time to time, one or more classes of preferred shares and, with respect to each such class, to fix the terms thereof by resolution; (v) restrictions on the ability of shareholders to call meetings and bring proposals before meetings; (vi) elimination of the ability of shareholders to act by written consent; and (vii) the requirement of the affirmative vote of two-thirds of the shares entitled to vote to amend certain provisions of our amended and restated memorandum and articles of association.

Interested Directors

The BVI Act provides that a director shall, after becoming aware that he is interested in a transaction entered into or to be entered into by the company, disclose that interest to our board of directors. The failure of a director to disclose that interest does not affect the validity of a transaction entered into by us or the director, so long as the director’s interest was disclosed to the board prior to our entry into the transaction or was not required to be disclosed (for example where the transaction is between us and the director himself or is otherwise in the ordinary course of business and on usual terms and conditions). As permitted by British Virgin Islands law and our amended and restated memorandum and articles of association, a director interested in a particular transaction may vote on it, attend meetings at which it is considered, and sign documents on our behalf which relate to the transaction.

Voting Rights and Quorum Requirements

Under British Virgin Islands law, the voting rights of shareholders are regulated by our amended and restated memorandum and articles of association and, in certain circumstances, the BVI Act. Our amended and restated memorandum and articles of association will govern matters such as quorum for the transaction of business, rights of shares, and majority votes required to approve any action or resolution at a meeting of the shareholders or board of directors. Unless the amended and restated memorandum and articles of association otherwise provide, the requisite majority is usually a simple majority of votes cast.

Mergers and Similar Arrangements

Under the BVI Act, two or more companies may merge or consolidate in accordance with the statutory provisions. A merger means the merging of two or more constituent companies into one of the constituent companies, and a consolidation means the uniting of two or more constituent companies into a new company. In order to merger or consolidate, the directors of each constituent company must approve a written plan of merger or consolidation which must be authorized by a resolution of shareholders.

Shareholders not otherwise entitled to vote on the merger or consolidation may still acquire the right to vote if the plan or merger or consolidation contains any provision which, if proposed as an amendment to the memorandum of association or articles of association, would entitle them to vote as a class or series on the proposed amendment. In any event, all shareholders must be given a copy of the plan of merger or consolidation irrespective of whether they are entitled to vote at the meeting or consent to the written resolution to approve the plan of merger or consolidation.

Shareholder Suits

We are not aware of any reported class action or derivative action having been brought in a British Virgin Islands court.

Under the BVI Act, if a company or a director of a company engages in, or proposes to engage in, conduct that contravenes the BVI Act or the memorandum of association or articles of the company, the BVI Court may, on the application of a shareholder or a director of the company, make an order directing the company or director to comply with, or restraining the company or director from engaging in that conduct.

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In addition, under the BVI Act, the BVI Court may, on the application of a shareholder of a company, grant leave to that shareholder to bring proceedings in the name and on behalf of that company or to intervene in proceedings to which the company is a party for the purpose of continuing, defending or discontinuing the proceedings on behalf of the company. In determining whether to grant leave for such derivative actions, the Court must take into account certain matters, including whether the shareholder is acting in good faith, whether the derivative action is in the interests of the company taking account of the views of the company’s directors on commercial matters and whether an alternative remedy to the derivative claim is available.

A shareholder of a company may bring an action against the company for breach of a duty owed by the company to him as a shareholder. The BVI Act also includes provisions for actions based on oppression, and for representative actions where the interests of the claimant are substantially the same as those of other shareholders.

Corporate Governance

British Virgin Islands laws do not restrict transactions with directors, requiring only that directors exercise a duty to act honestly, in good faith and in what the directors believe to be in the best interests to the companies for which they serve.

Indemnification

British Virgin Islands law and our amended and restated memorandum and articles of association provide for the indemnification of our directors against all losses or liabilities incurred or sustained by him or her as a director of our company in defending any proceedings, whether civil or criminal and this indemnity only applies if he or she acted honestly and in good faith with a view to our best interests and, with respect to any criminal action, he or she must have had no reasonable cause to believe his or her conduct was unlawful.

Transfer Agent and Registrar

The transfer agent and registrar for our common shares is , and their address is .

Listing

We intend to apply for listing of our common shares on the Nasdaq Capital Market under the symbol “ESTA.”

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MATERIAL BRITISH VIRGIN ISLAND AND U.S. FEDERAL INCOME TAX CONSIDERATIONS

The following is a general summary of certain British Virgin Islands and U.S federal income tax consequences relevant to an investment in our common shares. The discussion is not intended to be, nor should it be construed as, legal or tax advice to any prospective purchaser. This discussion is based on laws and relevant interpretations thereof in effect as of the date of this prospectus, all of which are subject to change or different interpretations, possibly with retroactive effect. This discussion does not address U.S. state or local tax laws, or tax laws of jurisdictions other than the British Virgin Islands and the United States. You should consult your own tax advisors with respect to the consequences of acquisition, ownership, and disposition of our common shares.

British Virgin Islands Taxation

The British Virgin Islands currently does not impose any income, corporate or capital gains tax, estate duty, inheritance tax, gift tax or withholding tax upon us or our security holders.

The company, and all distributions, interest and other amounts paid by the company to shareholders, are exempt from any income, withholding or capital gains taxes in the British Virgin Islands, with respect to the shares in the company owned by them and dividends received on such shares, nor will they be subject to any estate or inheritance taxes in the British Virgin Islands.

No estate, inheritance, succession or gift tax, rate, duty, levy or other charge is payable by shareholders with respect to any shares, debt obligations or other securities of the company.

All instruments relating to transactions in respect of the shares, debt obligations or other securities of the company and all instruments relating to other transactions relating to the business of the company are exempt from the payment of stamp duty in the British Virgin Islands, provided that they do not relate to real estate situated in the British Virgin Islands.

The British Virgin Islands is not party to any double tax treaties which are applicable to any payments made by or to our company. There are no exchange control regulations in the British Virgin Islands applicable to us or our security holders.

Material U.S. Federal Income Tax Considerations

The following discussion sets forth the material U.S federal income tax consequences relating to the acquisition, ownership, and disposition of our common shares by U.S. Holders (as defined below) that will hold our common shares as “capital assets” (generally, property held for investment) under the U.S. Internal Revenue Code, as amended, or the “Code.” The discussion below of U.S. federal income tax consequences to "U.S. Holders" will apply to you if you are a beneficial owner of our common shares and you are, for U.S. federal income tax purposes:


▪	an individual citizen or resident of the United States;


▪	a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia;


▪	an estate the income of which is subject to U.S. federal income taxation regardless of its source; or


▪	a trust if it (1) is subject to the primary supervision of a U.S. court and one or more U.S. persons that have the authority to control all substantial decisions of the trust or (2) has a valid election in effect under applica ble Treasury regulations to be treated as a U.S. person.

This summary applies only to U.S. Holders, and it does not describe all of the U.S. federal income tax consequences that may be relevant to U.S. Holders subject to special rules, such as:


▪	banks and other financial institutions;


▪	insurance companies;


▪	regulated investment companies;


▪	real estate investment trusts;


▪	government organizations;


▪	dealers and traders in securities that use mark-to-market accounting for U.S. federal income tax purposes;


▪	U.S. Holders who are accrual method taxpayers subject to special tax accounting rules under Section 451(b) of the Code;


▪	U.S. Holders holding common shares as part of a hedging transaction, straddle, conversion transaction or other integrated transaction;

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▪	U.S. Holders whose functional currency for U.S. federal income tax purposes is not the U.S. dollar;


▪	U.S. Holders liable for the alternative minimum tax;


▪	tax-exempt organizations or entities, including an "individual retirement account" or "Roth IRA" as defined in Section 408 or 408A of the Code, respectively;


▪	U.S. Holders that received the common shares as compensation for the performance of services;


▪	U.S. Holders holding common shares that own or are deemed to own 10% or more of our value or voting shares; or


▪	former citize ns and residents of the United States subject to tax as expatriates.

The discussion below is based upon applicable provisions of the Code, Treasury Regulations promulgated thereunder, pertinent judicial decisions, interpretive rulings of the Internal Revenue Service, or IRS, and such other authorities as we have considered relevant, all of which are subject to change, possibly with retroactive effect. In addition, significant changes in U.S. federal income tax laws were recently enacted. You should consult with your tax advisor with respect to such changes in U.S. tax law as well as potential conforming changes in state tax laws.

If you are a partner in a partnership or other entity treated as a partnership for U.S. federal income tax purposes that holds our common shares, your tax treatment will generally depend upon your status and the activities of the partnership. Prospective investors who are partners in a partnership should consult their tax advisers as to the particular U.S. federal income tax consequences of purchasing, owning and disposing of common shares in their particular circumstances.

In addition, this discussion does not address any non-U.S., state, local or any U.S. federal estate, gift or alternative minimum tax considerations. Each U.S. Holder should, and are urged to, consult its own tax adviser concerning the U.S. federal, state, local, and non-U.S. income and other tax consequences of an investment in our common shares.

This discussion is not a complete analysis or listing of all of the possible tax consequences and does not address all tax considerations that may be relevant to investors in light of their particular circumstances.

Taxation of Dividends

Subject to the discussion below under the subsection titled “Passive Foreign Investment Company”, the gross amount of distributions paid on common shares will be taxable as dividends, to the extent paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). Such income (including taxes withheld) will be includible in your gross income as ordinary income on the day actually or constructively received by you. Such dividends received from the common shares will be treated as foreign source income and will not be eligible for the dividends received deduction allowed to U.S. corporations under the Code. The following discussion assumes that all dividends will be paid in U.S. dollars. As used below, the term "dividend" means a distribution that constitutes a dividend for U.S. federal income tax purposes.

With respect to non-corporate U.S. Holders, certain dividends received from a qualified corporation may be subject to reduced rates of taxation applicable to “qualified dividend income (‘QDI’),” provided that certain conditions are satisfied. A U.S. Holder may receive QDI if the foreign corporation is treated as a qualified foreign corporation. A foreign corporation should be a qualified corporation if its shares, with respect to dividends received from the corporation, are readily tradable on an established U.S. securities market. Additionally, a U.S. Holder is required to (i) hold such common shares for 61 days or more during the 121-day period beginning on the date which is 60 days before the date on which such shares become ex-dividend with respect to such dividends and (ii) the U.S. Holder is not under an obligation (whether pursuant to a short sale or otherwise) to make related payments with respect to existing or substantially similar or related property. Our common shares are expected to be readily tradable on Nasdaq after this offering. However, such reduced rate will not apply if we are a for the taxable year in which we pay a dividend or were a PFIC for the preceding taxable year. See the subsection below titled “Passive Foreign Investment Company”.

To the extent that the amount of any distribution exceeds our current and accumulated earnings and profits for the taxable year, as determined under U.S. federal income tax principles, the distribution will first be treated first as a non-taxable return of capital, causing a reduction in the adjusted basis of the common shares (thereby increasing the amount of gain, or decreasing the amount of loss, to be recognized by you on the subsequent disposition of common shares), and the balance in excess of the adjusted basis will be taxed as capital gain recognized on a sale or exchange, as described below under “Taxation of Capital Gains.” Because we do not maintain calculations of our earnings and profits under U.S. federal income tax principles, it is expected that distributions generally will be reported to U.S. Holders as dividends. Distributions of additional common shares to U.S. Holders that are part of a pro rata distribution to all of our shareholders generally will not be subject to U.S. federal income tax. The amount of any distribution of property other than cash will be the fair market value of such property on the date of distribution.

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Taxation of Capital Gains

For U.S federal income tax purposes, you will generally recognize taxable gain or loss on any sale or exchange of common shares in an amount equal to the difference between the amount realized for the common share and your tax basis in the common shares. Generally, your tax basis should be the amount paid for the common shares. Subject to the discussion under “Passive Foreign Investment Company” below, such gain or loss will generally be capital gain or loss. Capital gains of individuals derived with respect to capital assets held for more than one year should be eligible for reduced rates of taxation. The deductibility of capital losses is subject to limitations under the Code. Such gain or loss generally will be U.S.-source gain or loss. You are urged to consult your tax advisor regarding the tax consequences if foreign tax is imposed on a disposition of our common shares, including the availability of the foreign tax credit under your particular circumstance.

Passive Foreign Investment Company

Based on the projected composition of our income and valuation of our assets, including goodwill, we do not believe we were a PFIC in 2017 and we do not expect to be a PFIC for our current taxable year or to become one in the future, although because our PFIC status is subject to a number of uncertainties, neither we nor our tax advisors can provide any assurances regarding our PFIC status . A non-U.S. corporation will be classified as a PFIC in any taxable year in which, either:


▪	at least 75% of its gross income is passive income; or


▪	at least 50% of the average quarterly value of its total gross assets is attributable to assets that produce "passive income" or are held for the production of passive income.

For this purpose, passive income generally includes dividends, interest, royalties, and rents (other than royalties and rents derived in the active conduct of a trade or business and not derived from a related person). If we own at least 25%, directly or indirectly, (by value) of shares of another corporation, we will be treated, for purposes of the PFIC tests, as owning our proportionate share of the other corporation’s assets and receiving our proportionate share of the other corporation’s income.

The determination of whether we are a PFIC is made annually. Accordingly it is possible that we may become a PFIC in the current or any future taxable year due to changes in our asset or income composition. If we are a PFIC for any taxable year during which you hold our common shares, you will be subject to special rules discussed below.

If we were a PFIC for any taxable year during which you hold our common shares, you will be subject to special tax rules with respect to any “excess distribution” received and any gain realized from the sale or other disposition (including, under certain circumstances, a pledge) of our common shares. Distributions received in a taxable year that are greater than 125% of the average annual distribution received during the shorter of the three preceding taxable years or your holding period for the common shares will be treated as excess distribution. Under these special rules:


▪	the excess distribution or gain will be allocated ratably over your holding period for the common shares;


▪	the amount allocated to the current taxable year, and any taxable year prior to the first taxable year in your holding period in which we were a PFIC, will be treated as ordinary income; and


▪	the amount allocated to each other taxable year would be subject to tax at the highest rate in effect for that taxabl e year for individuals or corporations, as appropriate, and an interest charge would be imposed on the tax attributable to the allocated amount.

In addition, non-corporate U.S Holders will not be eligible for reduced rates of taxation on any dividends received from us if we are a PFIC in the taxable year in which such dividends are paid or in the preceding taxable year. You will generally be required to file Internal Revenue Service Form 8621 if you hold our common shares in any year in which we are classified as a PFIC.

If we are a PFIC for any taxable year during which you hold our common shares and any of our non-U.S. subsidiaries is also a PFIC, a U.S. Holder would be treated as owning a proportionate amount (by value) of the shares of the lower-tier PFIC for purposes of the application of these rules. You are urged to consult your tax advisors about the application of the PFIC rules to any of our subsidiaries.

In certain circumstances, certain elections may be available that would result in alternative treatments (such as mark-to-market treatment) of common shares. Additionally, you can sometimes avoid the rules described above by electing to treat a PFIC as a “qualified electing fund” under Section 1295 of the Code. However, we do not intend to provide information necessary for U.S. Holders to make qualified electing fund elections if, contrary to our expectation, we are

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classified as a PFIC. U.S. Holders should consult their tax advisers to determine whether any of these elections would be available and if so, what the consequences of the alternative treatments would be in their particular circumstances.

Medicare Tax

Certain U.S. Holders that are individuals, estates or trusts are subject to a 3.8% tax on all or a portion of their “net investment income,” which may include all or a portion of their dividend income and net gains from the disposition of common shares. Each U.S. Holder that is an individual, estate or trust is urged to consult its tax advisors regarding the applicability of the Medicare tax to its income and gains in respect of its investment in the common shares.

Information Reporting and Backup Withholding

In general, information reporting will apply to dividends in respect to our common shares and the proceeds from the sale, exchange or redemption of our common shares that are paid to you within the U.S (and in certain cases outside the U.S). Payments of dividends and proceeds from the sale or other taxable disposition that are made within the U.S or through certain U.S.-related financial intermediaries generally are subject to information reporting, and may be subject to backup withholding, unless (1) the U.S. Holder is a corporation or other exempt recipient or (2) in the case of backup withholding, the U.S. Holder provides a correct taxpayer identification number and certifies that it is not subject to backup withholding.

Any amounts withheld under the backup withholding rules will be allowed as a refund or a credit against your U.S. federal income tax liability provided that the required information is timely furnished to the U.S. Internal Revenue Service.

Foreign Asset Reporting

Under the Hiring Incentives to Restore Employment Act of 2010, certain U.S. Holders who are required to report information relating to an interest in common shares, subject to certain exceptions (including an exception for common shares held in accounts maintained by U.S. financial institutions), by attaching a complete Internal Revenue Service Form 8938, Statement of Specified Foreign Financial Assets, with their tax return for each year in which they hold common shares. You are urged to consult your own tax advisors regarding their information reporting obligations, if any, with respect to your ownership of common shares.

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no public market for common shares and we cannot assure you that a liquid trading market for the common shares will develop or be sustained after this offering. Future sales of substantial amounts of common shares, including shares issued upon the exercise of outstanding options and warrants, in the public market after this offering, or the possibility of these sales occurring, could adversely affect the prevailing market price for our common shares or impair our ability to raise equity capital.

Based on the number of shares outstanding as of March 31, 2018, upon the closing of this offering, common shares will be outstanding, assuming no exercise of the underwriters’ option to purchase additional common shares and no exercise of outstanding options or warrants or issuance of shares reserved in connection with acquisition-related obligations. Of the outstanding shares, all of the shares sold in this offering will be freely tradable, except that any shares held by our affiliates, as that term is defined in Rule 144 under the Securities Act, may only be sold in compliance with the limitations described below.

The remaining common shares will be deemed “restricted securities” as defined in Rule 144. Restricted securities may be sold in the public market only if they are registered or if they qualify for an exemption from registration under Rule 144 or Rule 701 under the Securities Act, which rules are summarized below. In addition, holders of substantially all of our equity securities are subject to market stand-off agreements or have entered into lock-up agreements with the underwriters under which they have agreed, subject to specific exceptions, not to sell any of our equity for at least 180 days following the date of this prospectus, as described below. As a result of these agreements and the provisions of our amended and restated investors’ rights agreement described above under “Description of Share Capital- Key Provisions of our amended and restated memorandum and articles of association and British Virgin Islands Law Affecting our Common Shares ,” subject to the provisions of Rule 144 or Rule 701, following the expiration of the lock-up period, all shares subject to such provisions and agreements will be available for sale in the public market only if registered or pursuant to an exemption from registration under Rule 144 or Rule 701 under the Securities Act.

Rule 144

In general, a person who has beneficially owned restricted common shares for at least six months would be entitled to sell their securities provided that: (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the 90 days preceding a sale; and (ii) we are subject to the periodic reporting requirements of the Exchange Act, for at least 90 days before the sale. Persons who have beneficially owned restricted common shares for at least six months but who are our affiliates at the time of, or any time during the 90 days preceding, a sale, would be subject to additional restrictions, by which such person would be entitled to sell within any three-month period only a number of securities that does not exceed the greater of either of the following:


▪	1% of the number of common shares outstanding after this offering, which will equal approximately shares immediately after the closing of this offering, based on the number of common shares outstanding as of March 31 , 2018; or


▪	the average weekly trading volume of our common shares on Nasdaq during the four calendar weeks preced ing the filing of a notice on Form 144 with respect to the sale;

provided, in each case, that we are subject to the periodic reporting requirements the Exchange Act for at least 90 days before the sale. Such sales both by affiliates and by non-affiliates must also comply with the manner of sale, current public information and notice provisions of Rule 144.

Rule 701

Rule 701 under the Securities Act, as currently in effect, generally allows a shareholder who purchased common shares pursuant to a written compensatory plan or contract and who is not deemed to have been an affiliate of our company during the immediately preceding 90 days to sell these shares (subject to the requirements of the lock-up agreements, as described below) in reliance upon Rule 144, but without being required to comply with the public information, holding period, volume limitation, or notice provisions of Rule 144. Rule 701 also permits affiliates of our company to sell their Rule 701 shares under Rule 144 without complying with the holding period requirements of Rule 144. However, all holders of Rule 701 shares are required to wait until 90 days after the date of this prospectus (or until such later date that is required by the lock-up agreements, as described below) before selling such shares pursuant to Rule 701.

Lock-Up Agreements

We, our officers, directors, certain of our option holders and warrant holders, and holders of substantially all of our outstanding share capital have agreed with the underwriters that for a period of 180 days following the date of this

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prospectus, subject to certain exceptions, we will not offer, sell, assign, transfer, pledge, contract to sell or otherwise dispose of or hedge any common shares or any securities convertible into or exchangeable for common shares, subject to specified exceptions. Jefferies LLC and Cowen and Company, LLC jointly may, at their discretion and at any time or from time to time before the termination of the 180-day period, release all or any portion of the shares from the restrictions in the lock-up agreement.

Registration Statements on Form S-8

Upon the completion of this offering, we intend to file a registration statement on Form S-8 under the Securities Act to register all of the common shares issued or reserved for issuance under our share option plans. Shares covered by this registration statement will be eligible for sale in the public market, upon the expiration or release from the terms of the lock-up agreements and subject to vesting of such shares and Rule 144 limitations applicable to affiliates.

Registration Rights

Upon the closing of this offering, the holders of an aggregate of 14,158,113 common shares, issuable upon the conversion of outstanding ordinary shares and ordinary shares currently subject to outstanding warrants and options, and the holders of warrants issued in connection with the N ote and Warrant Purchase Agreement we entered with CPH to purchase an aggregate of 145,000 common shares, are entitled to certain rights with respect to the registration of the offer and sale of such common shares under the Securities Act. Registration of these shares under the Securities Act would result in the shares becoming freely tradable without restriction under the Securities Act immediately upon the effectiveness of the registration. See the section entitled “Description of Capital Stock - Key Provisions of our Amended and Restated Memorandum and Articles of Association and British Virgin Islands Law Affecting our Common Shares - Registration Rights” for additional information.

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UNDERWRITING

Subject to the terms and conditions set forth in the underwriting agreement, dated , 2018, between us and Jefferies LLC and Cowen and Company, LLC as the representatives of the underwriters named below, we have agreed to sell to the underwriters, and each of the underwriters has agreed, severally and not jointly, to purchase from us the respective number of common shares shown opposite its name below:




Underwriter		Number of Common Shares
Jefferies LLC
Cowen and Company, LLC
BTIG, LLC
Total

The underwriting agreement provides that the obligations of the several underwriters are subject to certain conditions precedent, such as the receipt by the underwriters of officers’ certificates legal opinions and approval of certain legal matters by their counsel and may be terminated at their discretion upon the occurrence of certain stated events. The underwriting agreement provides that the underwriters will purchase all of the common shares if any of them are purchased, other than those shares covered by the option to purchase additional common shares described below. If an underwriter defaults, the underwriting agreement provides that the purchase commitments of the non-defaulting underwriters may be increased or the underwriting agreement may be terminated. We have agreed to indemnify the underwriters and certain of their controlling persons against certain liabilities, including liabilities under the Securities Act, and to contribute to payments that the underwriters may be required to make in respect of those liabilities.

The underwriters have advised us that, following the pricing of this offering, they currently intend to make a market in our common shares as permitted by applicable laws and regulations. However, the underwriters are not obligated to do so, and the underwriters may discontinue any market-making activities at any time without notice in their sole discretion. Accordingly, no assurance can be given as to the liquidity of the trading market for our common shares, that you will be able to sell any of our common shares held by you at a particular time or that the prices that you receive when you sell will be favorable.

The underwriters are offering the common shares subject to their acceptance of the common shares from us and subject to prior sale. The underwriters reserve the right to withdraw, cancel or modify offers to the public and to reject orders in whole or in part. In addition, the underwriters have advised us that they do not intend to confirm sales to any account over which they exercise discretionary authority.

Commission and Expenses

The underwriters have advised us that they propose to offer the common shares to the public at the initial public offering price set forth on the cover page of this prospectus and to certain dealers, which may include the underwriters, at that price less a concession not in excess of $ per common share. After the offering, the initial public offering price, concession and reallowance to dealers may be reduced by the representative. No such reduction will change the amount of proceeds to be received by us as set forth on the cover page of this prospectus.

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The following table shows the public offering price, the underwriting discounts and commissions that we are to pay the underwriters and the proceeds, before expenses, to us in connection with this offering. Such amounts are shown assuming both no exercise and full exercise of the underwriters’ option to purchase additional shares.




		Total
	Per share	No exercise	Full exercise
Public offering price	$	$	$
Underwriting discounts and commissions paid by us	$	$	$
Proceeds to us, before expenses	$	$	$

We estimate expenses payable by us in connection with this offering, other than the underwriting discounts and commissions referred to above, will be approximately $ million. We have also agreed to reimburse the underwriters for up to $ of expenses related to the review of this offering by the Financial Industry Regulatory Authority, Inc.

Determination of Offering Price

Prior to this offering, there has not been a public market for our common shares. Consequently, the initial public offering price for our common shares will be determined by negotiations between us and the representatives. Among the factors to be considered in these negotiations will be prevailing market conditions, our financial information, market valuations of other companies that we and the underwriters believe to be comparable to us, estimates of our business potential, the present state of our development and other factors deemed relevant.

We offer no assurances that the initial public offering price will correspond to the price at which our common shares will trade in the public market subsequent to the offering or that an active trading market for our common shares will develop and continue after the offering.

Listing

We intend to apply to list our common shares on the Nasdaq Capital Market, subject to notice of issuance, under the trading symbol “ESTA.”

Stamp Taxes

If you purchase common shares offered in this prospectus, you may be required to pay stamp taxes and other charges under the laws and practices of the country of purchase, in addition to the offering price listed on the cover page of this prospectus.

Option to Purchase Additional Shares

We have granted to the underwriters an option, exercisable for 30 days from the date of this prospectus, to purchase, from time to time, in whole or in part, up to an aggregate of common shares from us at the public offering price set forth on the cover page of this prospectus, less underwriting discounts and commissions. If the underwriters exercise this option, each underwriter will be obligated, subject to specified conditions, to purchase a number of additional shares proportionate to that underwriter’s initial purchase commitment as indicated in the table above.

No Sales of Similar Securities

We, our officers, directors, certain of our option holders and warrant holders, and holders of all of our outstanding share capital have agreed, subject to specified exceptions, not to directly or indirectly:


▪	sell, offer, contract or grant any option to sell (including any short sale), pledge, transfer, establish an open “put equivalent position” within the meaning of Rule 16a-1(h) under the Exchange Act,


▪	otherwise dispose of any common shares, options or warrants to acquire common shares, or securities exchangeable or exercisable for or convertible into common shares currently or hereafter owned either of record or beneficially, or


▪	publicly announce an intention to do any of the foregoing for a period of 180 days after the date of this prospectus without the prior written c onsent of Jefferies LLC and Cowen and Company, LLC.

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This restriction terminates after the close of trading of our common shares on and including the 180 ^th day after the date of this prospectus.

Jefferies LLC and Cowen and Company, LLC jointly may, at their discretion and at any time or from time to time before the termination of the 180-day period, release all or any portion of the securities subject to lock-up agreements. There are no existing agreements between the underwriters and our shareholders who will execute a lock-up agreement, providing consent to the sale of shares prior to the expiration of the lock-up period.

Stabilization

The underwriters have advised us that, pursuant to Regulation M under the Exchange Act, they engage in short sale transactions, stabilizing transactions, syndicate covering transactions or the imposition of penalty bids in connection with this offering. These activities may have the effect of stabilizing or maintaining the market price of our common shares at a level above that which might otherwise prevail in the open market. Establishing short sales positions may involve either “covered” short sales or “naked” short sales.

“Covered” short sales are sales made in an amount not greater than the underwriters’ option to purchase additional common shares in this offering. The underwriters may close out any covered short position by either exercising their option to purchase additional common shares or purchasing common shares in the open market. In determining the source of common shares to close out the covered short position, the underwriters will consider, among other things, the price of common shares available for purchase in the open market as compared to the price at which they may purchase common shares through the option to purchase additional common shares.

“Naked” short sales are sales in excess of the option to purchase additional common shares. The underwriters must close out any naked short position by purchasing common shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of our common shares in the open market after pricing that could adversely affect investors who purchase in this offering.

A stabilizing bid is a bid for the purchase of common shares on behalf of the underwriters for the purpose of fixing or maintaining the price of our common shares. A syndicate covering transaction is the bid for or the purchase of common shares on behalf of the underwriters to reduce a short position incurred by the underwriters in connection with the offering. Similar to other purchase transactions, the underwriter’s purchases to cover the syndicate short sales may have the effect of raising or maintaining the market price of our common shares or preventing or retarding a decline in the market price of our common shares. As a result, the price of our common shares may be higher than the price that might otherwise exist in the open market. A penalty bid is an arrangement permitting the underwriters to reclaim the selling concession otherwise accruing to a syndicate member in connection with the offering if our common shares originally sold by such syndicate member are purchased in a syndicate covering transaction and therefore have not been effectively placed by such syndicate member.

Neither we nor any of the underwriters make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of our common shares. The underwriters are not obligated to engage in these activities and, if commenced, any of the activities may be discontinued at any time.

The underwriters may also engage in passive market making transactions in our common shares on The Nasdaq Capital Market in accordance with Rule 103 of Regulation M during a period before the commencement of offers or sales of common shares in this offering and extending through the completion of distribution. A passive market maker must display its bid at a price not in excess of the highest independent bid of that security. However, if all independent bids are lowered below the passive market maker’s bid, that bid must then be lowered when specified purchase limits are exceeded.

Electronic Distribution

A prospectus in electronic format may be made available by e-mail or on the websites or through online services maintained by one or more of the underwriters or their affiliates. In those cases, prospective investors may view offering terms online and may be allowed to place orders online. The underwriters may agree with us to allocate a specific number of common shares for sale to online brokerage account holders. Any such allocation for online distributions will be made by the underwriters on the same basis as other allocations. Other than the prospectus in electronic format, the information on the underwriters’ websites and any information contained in any other website maintained by any of the underwriters is not part of this prospectus, has not been approved and/or endorsed by us or the underwriters and should not be relied upon by investors.

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Other Activities and Relationships

The underwriters and certain of their respective affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging, financing and brokerage activities. The underwriters and certain of its affiliates have, from time to time, performed, and may in the future perform, various commercial and investment banking and financial advisory services for us and our affiliates, for which they received or will receive customary fees and expenses.

In the ordinary course of their various business activities, the underwriters and certain of their respective affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own accounts and for the accounts of their customers, and such investment and securities activities may involve securities and/or instruments issued by us and our affiliates. If the underwriters or their respective affiliates have a lending relationship with us, they routinely hedge their credit exposure to us consistent with their customary risk management policies. The underwriters and their respective affiliates may hedge such exposure by entering into transactions which consist of either the purchase of credit default swaps or the creation of short positions in our securities or the securities of our affiliates, including potentially our common shares offered hereby. Any such short positions could adversely affect future trading prices of our common shares offered hereby. The underwriters and certain of their respective affiliates may also communicate independent investment recommendations, market color or trading ideas and/or publish or express independent research views in respect of such securities or instruments and may at any time hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments.

Selling Restrictions

This prospectus does not constitute an offer to sell to, or a solicitation of an offer to buy from, anyone in any country or jurisdiction (1) in which such an offer or solicitation is not authorized, (2) in which any person making such offer or solicitation is not qualified to do so or (3) in which any such offer or solicitation would otherwise be unlawful. No action has been taken that would, or is intended to, permit a public offer of the common shares or possession or distribution of this prospectus or any other offering or publicity material relating to the common shares in any country or jurisdiction (other than the United States ) where any such action for that purpose is required. Accordingly, each underwriter has undertaken that it will not, directly or indirectly, offer or sell any common shares or have in its possession, distribute or publish any prospectus, form of application, advertisement or other document or information in any country or jurisdiction except under circumstances that will, to the best of its knowledge and belief, result in compliance with any applicable laws and regulations and all offers and sales of the common shares by it will be made on the same terms.

European Economic Area

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a “Relevant Member State”), with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State, no offer of common shares may be made to the public in that Relevant Member State other than:


▪	to any legal entity which is a qualified investor, as defined in the Prospectus Directive;


▪	to fewer than 150 natural or legal persons (other than qualified investors as defined in the Prospectus Directive), subject to obtaining the prior consent of the representatives of the underwriters for any such offer; or

▪

in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of shares shall require us or any underwriter to publish a prospectus pursuant to Article 3 of the Prospectus Directive and each person in a Relevant Member State who initially acquires any shares or to whom any offer is made will be deemed to have represented, acknowledged and agreed that it is a “qualified investor” within the meaning of the law in that Relevant Member State implementing Article 2(1)(e) of the Prospectus Directive .

In the case of any shares being offered to a financial intermediary as that term is used in Article 3(2) of the Prospectus Directive, each such financial intermediary will be deemed to have represented, acknowledged and agreed that the shares acquired by it in the offer have not been acquired on a non-discretionary basis on behalf of, nor have they been acquired with a view to their offer or resale to, persons in circumstances which may give rise to an offer of any shares to the public other than their offer or resale in a Relevant Member State to qualified investors as so defined or in circumstances in which the prior consent of the representatives has been obtained to each such proposed offer or resale.

For the purposes of this provision, the expression an “offer of shares to the public” in relation to any shares in any Relevant Member State means the communication in any form and by means of sufficient information on the terms of the offer and the shares to be offered so as to enable an investor to decide to purchase shares, as the same may be

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varied in that Relevant Member State by any measure implementing the Prospectus Directive in that Member State, the expression “Prospectus Directive” means Directive 2003/71/EC (as amended, including by Directive 2010/73/EU), and includes any relevant implementing measure in the Relevant Member State.

United Kingdom

In addition, in the United Kingdom, this document is being distributed only to, and is directed only at, and any offer subsequently made may only be directed at persons who are “qualified investors” (as defined in the Prospectus Directive) (i) who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”) and/or (ii) who are high net worth companies (or persons to whom it may otherwise be lawfully communicated) falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”) or otherwise in circumstances which have not resulted and will not result in an offer to the public of the shares in the United Kingdom within the meaning of the Financial Services and Markets Act 2000.

Any person in the United Kingdom that is not a relevant person should not act or rely on the information included in this document or use it as basis for taking any action. In the United Kingdom, any investment or investment activity that this document relates to may be made or taken exclusively by relevant persons.

Australia

This prospectus is not a disclosure document for the purposes of Australia’s Corporations Act 2001 (Cth) of Australia, or Corporations Act, has not been lodged with the Australian Securities & Investments Commission and is only directed to the categories of exempt persons set out below. Accordingly, if you receive this prospectus in Australia:

You confirm and warrant that you are either:


▪	a “sophisticated investor” under section 708(8)(a) or (b) of the Corporations Act;


▪	a “sophisticated investor” under section 708(8)(c) or (d) of the Corporations Act and that you have provided an accountant's certificate to us which complies with the requirements of section 708(8)(c)(i) or (ii) of the Corporations Act and related regulations before the offer has been made;


▪	a person associated with us under Section 708(12) of the Corporations Act; or


▪	a “professional inv estor” within the meaning of section 708(11)(a) or (b) of the Corporations Act.

To the extent that you are unable to confirm or warrant that you are an exempt sophisticated investor, associated person or professional investor under the Corporations Act any offer made to you under this prospectus is void and incapable of acceptance.

You warrant and agree that you will not offer any of the securities issued to you pursuant to this prospectus for resale in Australia within 12 months of those securities being issued unless any such resale offer is exempt from the requirement to issue a disclosure document under section 708 of the Corporations Act.

Hong Kong

The shares have not been offered or sold and will not be offered or sold in Hong Kong, by means of any document, other than (a) to “professional investors” as defined in the Securities and Futures Ordinance (Cap. 571) of Hong Kong and any rules made under that Ordinance; or (b) in other circumstances which do not result in the document being a “prospectus” as defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) of Hong Kong or which do not constitute an offer to the public within the meaning of that Ordinance. No advertisement, invitation or document relating to the shares has been or may be issued or has been or may be in the possession of any person for the purposes of issue, whether in Hong Kong or elsewhere, which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” as defined in the Securities and Futures Ordinance and any rules made under that Ordinance.

The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer. If you are in any doubt about any of the contents of this document, you should obtain independent professional advice.”

Israel

This document does not constitute a prospectus under the Israeli Securities Law, 5728-1968, or the Securities Law, and has not been filed with or approved by the Israel Securities Authority. In Israel, this prospectus is being distributed only to, and is directed only at, and any offer of the common shares is directed only at, (i) a limited number of persons in

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accordance with the Israeli Securities Law and (ii) investors listed in the first addendum, or the Addendum, to the Israeli Securities Law, consisting primarily of joint investment in trust funds, provident funds, insurance companies, banks, portfolio managers, investment advisors, members of the Tel Aviv Stock Exchange, underwriters, venture capital funds, entities with equity in excess of NIS 50 million and “qualified individuals,” each as defined in the Addendum (as it may be amended from time to time), collectively referred to as qualified investors (in each case, purchasing for their own account or, where permitted under the Addendum, for the accounts of their clients who are investors listed in the Addendum). Qualified investors are required to submit written confirmation that they fall within the scope of the Addendum, are aware of the meaning of same and agree to it.

Japan

The shares have not been and will not be registered pursuant to Article 4, Paragraph 1 of the Financial Instruments and Exchange Act. Accordingly, none of the shares nor any interest therein may be offered or sold, directly or indirectly, in Japan or to, or for the benefit of, any “resident” of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to or for the benefit of a resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Act and any other applicable laws, regulations and ministerial guidelines of Japan in effect at the relevant time .

Singapore

This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the “SFA”), (ii) to a relevant person pursuant to Section 275(1), or any person pursuant to Section 275(1A), and in accordance with the conditions specified in Section 275 of the SFA, or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

Where the common shares are subscribed or purchased under Section 275 of the SFA by a relevant person which is:


▪	a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or


▪	a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an accredited investor,

securities (as defined in Section 239(1) of the SFA) of that corporation or the beneficiaries’ rights and interest (howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has acquired the common shares pursuant to an offer made under Section 275 of the SFA except:


▪	to an institutional investor or to a relevant person defined in Section 275(2) of the SFA, or to any person arising from an offer referred to in Section 275(1A) or Section 276(4)(i)(B) of the SFA;


▪	where no consideration is or will be given for the transfer;


▪	where the transfer is by operation of law;


▪	as specified in Section 276(7) of the SFA; or


▪	as specified in R egulation 32 of the Securities and Futures (Offers of Investments) (Shares and Debentures) Regulations 2005 of Singapore.

Switzerland

The shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange, or the SIX, or on any other stock exchange or regulated trading facility in Switzerland. This document does not constitute a prospectus within the meaning of, and has been prepared without regard to the disclosure standards for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in Switzerland. Neither this document nor any other offering or marketing material relating to the shares or the offering may be publicly distributed or otherwise made publicly available in Switzerland.

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Neither this document nor any other offering or marketing material relating to the offering, the Company, the shares have been or will be filed with or approved by any Swiss regulatory authority. In particular, this document will not be filed with, and the offer of shares will not be supervised by, the Swiss Financial Market Supervisory Authority FINMA, or FINMA, and the offer of shares has not been and will not be authorized under the Swiss Federal Act on Collective Investment Schemes, or the CISA. The investor protection afforded to acquirers of interests in collective investment schemes under the CISA does not extend to acquirers of shares.

Canada

The offering of our common shares in Canada is being made on a private placement basis in reliance on exemptions from the prospectus requirements under the securities laws of each applicable Canadian province and territory where the common shares may be offered and sold, and therein may only be made with investors that are purchasing as principal and that qualify as both an accredited investor, as such term is defined in National Instrument 45-106 Prospectus and Registration Exemptions and as a permitted client, as such term is defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligation. Any offer and sale of our common shares in any province or territory of Canada may only be made through a dealer that is properly registered under the securities legislation of the applicable province or territory wherein our common shares are offered and/or sold or, alternatively, by a dealer that qualifies under and is relying upon an exemption from the registration requirements therein.

Any resale of our common shares by an investor resident in Canada must be made in accordance with applicable Canadian securities laws, which may require resales to be made in accordance with prospectus and registration requirements, statutory exemptions from the prospectus and registration requirements or under a discretionary exemption from the prospectus and registration requirements granted by the applicable Canadian securities regulatory authority. These resale restrictions may under certain circumstances apply to resales of our common shares outside of Canada.

Upon receipt of this document, each Canadian investor hereby confirms that it has expressly requested that all documents evidencing or relating in any way to the sale of the securities described herein (including for greater certainty any purchase confirmation or any notice) be drawn up in the English language only. Par la réception de ce document, chaque investisseur canadien confirme par les présentes qu'il a expressément exigé que tous les documents faisant foi ou se rapportant de quelque manière que ce soit à la vente des valeurs mobilières décrites aux présentes (incluant, pour plus de certitude, toute confirmation d'achat ou tout avis) soient rédigés en anglais seulement.

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LEGAL MATTERS

Certain legal matters as to U.S. federal, Delaware and New York law in connection with this offering will be passed upon for us by Wilson Sonsini Goodrich & Rosati, P.C., Palo Alto, California, United States. Conyers Dill & Pearman, Road Town, Tortola, British Virgin Islands, will pass upon the validity of the common shares offered hereby and other legal matters concerning this offering relating to British Virgin Islands law, including matters of British Virgin Islands income tax law. Cooley LLP, Palo Alto, California, United States has acted as counsel to the underwriters in connection with this offering.

EXPERTS

The consolidated financial statements of Establishment Labs Holdings Inc. as of December 31, 2016 and 2017, and for the years then ended, included in this prospectus have been so included in reliance on the report of Marcum, LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

WHERE YOU CAN FIND MORE INFORMATION

We have submitted to the SEC a registration statement on Form S-1 under the Securities Act with respect to the common shares offered hereby. This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth in the registration statement, some of which is contained in exhibits to the registration statement as permitted by the rules and regulations of the SEC. For further information about us and the common shares offered hereby, we refer you to the registration statement, including the exhibits filed as a part of the registration statement. Statements contained in this prospectus regarding the contents of any contract or any other document that is filed as an exhibit to the registration statement are not necessarily complete. If a contract or document has been filed as an exhibit to the registration statement, please see the copy of the contract or document that has been filed. Each statement is this prospectus relating to a contract or document filed as an exhibit is qualified in all respects by the filed exhibit.

You may obtain copies of this information by mail from the Public Reference Section of the SEC, 100 F Street, N.E., Room 1580, Washington, D.C. 20549, at prescribed rates. You may obtain information on the operation of the public reference rooms by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet website that contains reports, proxy statements and other information about issuers, like us, that file electronically with the SEC. The address of that website is www.sec.gov.

As a result of this offering, we will become subject to the information and reporting requirements of the Exchange Act and, in accordance with this law, will file periodic reports, proxy statements and other information with the SEC. These periodic reports, proxy statements and other information will be available for inspection and copying at the SEC’s public reference facilities and the website of the SEC referred to above. We also maintain a website at www.establishmentlabs.com, at which you may access these materials free of charge as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. Information contained on our website is not a part of this prospectus and the inclusion of our website address in this prospectus is an inactive textual reference only.

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ENFORCEABILITY OF CIVIL LIABILITIES UNDER U.S. FEDERAL SECURITIES LAWS

Almost all of our assets are located outside of the United States. A majority of our officers are nationals or residents of jurisdictions other than the United States and a substantial portion of their assets are located outside the United States. As a result, it may be difficult for a shareholder to effect service of process within the United States upon these persons, or to enforce against us or them judgments obtained in U.S. courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state of the United States. We have appointed Motiva USA LLC, as our agent upon whom process may be served in any action brought against us under the securities laws of the United States.

We have been advised by Conyers Dill & Pearman, our counsel as to British Virgin Islands Law, that the United States and the British Virgin Islands do not have a treaty providing for reciprocal recognition and enforcement of judgments of courts of the United States in civil and commercial matters and that a final judgment for the payment of money rendered by any general or state court in the United States based on civil liability, whether or not predicated solely upon the U.S. federal securities laws, would not be automatically enforceable in the British Virgin Islands. We have also been advised by Conyers Dill & Pearman that at common law, the courts of the British Virgin Islands would recognize as a valid judgment, a final and conclusive judgment in personum obtained in the courts of all countries not covered by the British Virgin Islands Reciprocal Enforcement of Judgments Act (Cap. 65) (or, where applicable, the Foreign Judgments (Reciprocal Enforcement) Act (Cap. 27)) against us based upon the documents under which a sum of money is payable (other than a sum of money payable in respect of multiple damages, taxes or other charges of a like nature or in respect of a fine or other penalty) and would give a judgment based thereon provided that (a) such courts had proper jurisdiction over the parties subject to such judgment, (b) such courts did not contravene the rules of natural justice of the British Virgin Islands, (c) such judgment was not obtained by fraud, (d) the enforcement of the judgment would not be contrary to the public policy of the British Virgin Islands, (e) no new admissible evidence relevant to the action is submitted prior to the rendering of the judgment by the courts of the British Virgin Islands and (f) there is due compliance with the correct procedures under the laws of the British Virgin Islands. Such a judgment would be enforced by treating the judgment as a cause of action and commencing an action on the foreign judgment debt in the Court of the British Virgin Islands, with a view to proceeding with the claim by way of summary judgment.

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ESTABLISHMENT LABS HOLDINGS INC.

Index to Consolidated Financial Statements

Years Ended December 31, 2016 and 2017




	PAGE
Report of Independent Registered Public Accounting Firm	F-2
Consolidated Financial Statements
Consolidated Balance Sheets	F-3
Consolidated Statements of Operations	F-4
Consolidated Statements of Comprehensive Loss	F-5
Consolidated Statements of Shareholders’ Deficit	F-6
Consolidated Statements of Cash Flows	F-7
Notes to Consolidated Financial Statements	F-9

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders

of Establishment Labs Holdings Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Establishment Labs Holdings Inc. (the “Company”) as of December 31, 2017 and 2016, and the related consolidated statements of operations, comprehensive loss, shareholders’ deficit and cash flows for each of the two years in the period ended December 31, 2017, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2017, in conformity with accounting principles generally accepted in the United States of America.

Explanatory Paragraph - Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As more fully described in Note 1, the Company has incurred significant losses and currently does not expect to experience positive cash flows from operations in the near future and is in technical default of certain debt covenants . These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Marcum LLP

Marcum LLP

Irvine, CA

We have served as the Company’s auditor since 2016.

May 10, 2018

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ESTABLISHMENT LABS HOLDINGS INC.

Consolidated Balance Sheets

(In thousands, except share data)




	December 31,
	2016			2017
Assets
Current assets:
Cash	$	479		$	10,864
Accounts receivable, net of allowance for doubtful accounts of $569 and $1,512	6,648			13,108
Inventory	4,800			13,173
Prepaid expenses and other current assets	593			2,237
Total current assets	12,520			39,382
Long-term assets:
Property and equipment, net of accumulated depreciation of $1,562 and $3,179	13,230			13,500
Goodwill	255			465
Intangible assets, net of accumulated amortization of $251 and $573	2,099			3,401
Restricted cash	171			75
Other non-current assets	1,287			272
Total assets	$	29,562		$	57,095
Liabilities and shareholders’ equity (deficit)
Current liabilities:
Accounts payable	$	7,281		$	9,131
Accrued liabilities	1,203			2,326
Warrant liability	3,983			—
EDC put option liability	36			—
Perceptive put option liability	1,165			—
Liability for shares repurchase	1,653			—
Notes payable, Perceptive debt, net of debt discount and issuance costs	12,015			—
Related party convertible notes payable, net of debt discount and issuance costs, including accrued interest	21,308			—
CPH put option liability	941			—
Notes payable related party, including accrued interest	4,626			4,921
Note payable, Madryn, net of debt discount and issuance costs	—			19,167
Madryn put option	—			20,302
Madryn call option	—			360
Notes payable, short term	200			—
Other liabilities, short term	161			1,228
Total current liabilities	54,572			57,435
Long-term liabilities:
Other liabilities, long term	1,425			4,673
Total liabilities	55,997			62,108
Commitments and contingencies (Note 7)
Shareholders’ equity (deficit):
Class Z redeemable convertible preferred shares, $500.00 par value - 7,364 and zero shares authorized December 31, 2016 and 2017, respectively; zero shares issued and outstanding as of December 31, 2016 and 2017	—			—
Ordinary shares - $1.00 par value (class A and B), 15,942,636 and 21,206,630 shares authorized at December 31, 2016 and 2017, respectively; 7,118,753 and 13,427,536 shares issued at December 31, 2016 and 2017, respectively; 6,305,613 and 12,206,326 shares outstanding at December 31, 2016 and 2017, respectively	7,118			13,427
Ordinary shares - no par value (class C, D, E and F), zero and 2,316,169 shares authorized at December 31, 2016 and 2017, respectively; zero and 2,316,169 shares issued at December 31, 2016 and 2017, respectively; zero and 2,316,169 shares outstanding at December 31, 2016 and 2017, respectively	—			27,840
Common shares - $1.00 par value, 84,050,000 shares authorized at December 31, 2016 and 2017; zero shares issued and outstanding at December 31, 2016 and 2017	—			—
Additional paid-in-capital	3,038			27,986
Treasury shares, at cost, 813,140 and 1,221,210 shares held at December 31, 2016 and 2017, respectively	(3,611		)	(6,465		)
Accumulated deficit	(32,980		)	(67,877		)
Other comprehensive income	—			76
Total shareholders’ equity (deficit)	(26,435		)	(5,013		)
Total liabilities and shareholders’ equity (deficit)	$	29,562		$	57,095

See notes to consolidated financial statements.

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ESTABLISHMENT LABS HOLDINGS INC.

Consolidated Statements of Operations

(In thousands, except share and per share data)




	Year ended December 31,
	2016			2017
Revenue	$	19,801		$	34,681
Cost of revenue	9,705			16,979
Gross profit	10,096			17,702
Operating expenses:
Sales, general and administrative	23,189			30,821
Research and development	2,740			6,864
Total operating expenses	25,929			37,685
Loss from operations	(15,833		)	(19,983		)
Interest income	44			19
Interest expense	(3,413		)	(10,420		)
Gain on settlement of Magna put option liability	92			—
Change in fair value of Madryn put option liability	—			(258		)
Change in fair value of Madryn call option liability	—			(277		)
Change in fair value of warrant liability	(1,802		)	(4,035		)
Change in fair value of liability to issue shares - Magna	(21		)	—
Change in fair value of liability to issue shares - EDC	26			—
Change in fair value of Magna put option liability	5			—
Change in fair value of EDC put option liability	38			36
Change in fair value of CPH and Perceptive put option liability	(843		)	2,106
Change in fair value of CPH call option liability	21			—
Initial public offering expenses	—			(1,585		)
Other income (expense), net	(339		)	(395		)
Loss before income taxes	(22,025		)	(34,792		)
Provision for income taxes	(134		)	(105		)
Net loss	$	(22,159	)	$	(34,897	)

Basic and diluted net loss per share attributable to ordinary shareholders	$	(3.42	)	$	(3.41	)
Weighted average outstanding ordinary shares used for net loss per share attributable to ordinary shareholders	6,482,249			10,230,586

See notes to consolidated financial statements.

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ESTABLISHMENT LABS HOLDINGS INC.

Consolidated Statements of Comprehensive Loss

(In thousands)




	Year ended December 31,
	2016			2017
Net loss	$	(22,159	)	$	(34,897	)
Other comprehensive income:
Foreign currency translation gain	—			76
Other comprehensive income	—			76
Comprehensive loss	$	(22,159	)	$	(34,821	)

See notes to consolidated financial statements.

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Table of Contents

ESTABLISHMENT LABS HOLDINGS INC.

Consolidated Statements of Shareholders’ Deficit

(In thousands, except share data)




									Additional Paid-In Capital			Accumulated Deficit			Accumulated Other Comprehensive Income		Total
	Ordinary Shares			Treasury Shares
	Shares	Amount		Shares		Amount
Balance at January 1, 2016	6,586,857	$	6,587	—		$	—		$	473		$	(10,821	)	$	—	$	(3,761	)
Extinguishment of debt discount with related party	—	—		—		—			(5,500		)	—			—		(5,500		)
Extinguishment of warrants with related party	—	—		—		—			1,822			—			—		1,822
Beneficial conversion feature associated with notes payable related party	—	—		—		—			2,953			—			—		2,953
Issuance of shares in business combination	18,000	18		—		—			55			—			—		73
Extinguishment of dividends on ordinary shares	—	—		—		—			623			—			—		623
Repurchase of ordinary shares	—	—		(813,140	)	(3,611		)	—			—			—		(3,611		)
Stock-based compensation	513,896	513		—					2,612			—			—		3,125
Net loss	—	—		—					—			(22,159		)	—		(22,159		)
Balance at December 31, 2016	7,118,753	$	7,118	(813,140	)	$	(3,611	)	$	3,038		$	(32,980	)	$	—	$	(26,435	)
Issuance of shares	2,316,169	27,840		—		—			—			—			—		27,840
Cumulative change in accounting principle (adoption of ASU 2017-11)	—	—		—		—			958			—			—		958
Extinguishment of warrants with related party	207,716	208		—		—			2,192			—			—		2,400
Conversion of related party convertible notes payable	5,869,417	5,869		—		—			18,383			—			—		24,252
Issuance of shares in business combination	35,714	36		—		—			308			—			—		344
Repurchase of ordinary shares	—	—		(408,070	)	(2,854		)	—			—			—		(2,854		)
Stock-based compensation	195,936	196		—		—			3,107			—			—		3,303
Foreign currency translation gain	—	—		—		—			—			—			76		76
Net loss	—	—		—		—			—			(34,897		)	—		(34,897		)
Balance at December 31, 2017	15,743,705	$	41,267	(1,221,210	)	$	(6,465	)	$	27,986		$	(67,877	)	$	76	$	(5,013	)

See notes to consolidated financial statements.

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ESTABLISHMENT LABS HOLDINGS INC.

Consolidated Statements of Cash Flows

(In thousands)




	Year Ended December 31,
	2016			2017
Cash flows from operating activities:
Net loss	$	(22,159	)	$	(34,897	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	592			1,939
Provision for doubtful accounts	409			943
Stock-based compensation	3,125			3,303
Write off of deferred offering costs	—			1,585
Gain on extinguishment of Magna put option liability	(92		)	—
Change in fair value of Madryn put option	—			258
Change in fair value of Madryn call option	—			277
Change in fair value of warrant liability	1,802			4,035
Change in fair value of liability to issue shares - Magna	21			—
Change in fair value of Magna put option liability	(5		)	—
Change in fair value of CPH put option liability	843			(2,106		)
Change in fair value of CPH call option liability	(21		)	—
Change in fair value of liability to issue shares - EDC	(26		)	—
Change in fair value of EDC put option liability	(38		)	(36		)
Non-cash interest expense and amortization of debt discount	3,122			7,054
Changes in operating assets and liabilities:
Accounts receivable	(4,720		)	(6,911		)
Inventory	(1,361		)	(6,437		)
Prepaid expenses and other current assets	(450		)	(1,681		)
Other assets	(169		)	(570		)
Accounts payable	3,939			(878		)
Accrued liabilities	931			1,103
Other liabilities	(9		)	1,049
Net cash used in operating activities	(14,266		)	(31,970		)
Cash flows from investing activities:
Purchases of property and equipment	(10,463		)	(901		)
Cash used in business acquisition, net of cash acquired	(147		)	—
Costs incurred for intangible assets	(91		)	(40		)
Increase (decrease) in restricted cash	(55		)	96
Net cash used in investing activities	(10,756		)	(845		)
Cash flows from financing activities:
Borrowings under related party convertible notes, net of issuance costs	9,216			—
Borrowings under Madryn credit agreement, net of issuance costs	—			38,465
Borrowings under Perceptive credit agreement, net of issuance costs	14,390			—
Borrowings on notes payable	1,450			—
Payments of deferred offering costs	(278		)	(914		)
Repayments on short term notes payable	—			(200		)
Repayments under Perceptive credit agreement	—			(15,000		)

See notes to consolidated financial statements.

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ESTABLISHMENT LABS HOLDINGS INC.

Consolidated Statements of Cash Flows (continued)

(In thousands)




	Year Ended December 31,
	2016			2017
Repayments under notes payable	(1,487		)	—
Repayments on capital leases	(103		)	(291		)
Cash used to settle Magna put option liability	(977		)	—
Cash used to repurchase warrants	—			(2,400		)
Proceeds from issuance of ordinary shares	—			27,840
Shares repurchased	(2,000		)	(4,507		)
Net cash provided by financing activities	20,211			42,993
Effect of exchange rate changes on cash	—			207
Net increase (decrease) in cash	(4,811		)	10,385
Cash at beginning of year	5,290			479
Cash at end of year	$	479		$	10,864

Supplemental disclosures:
Cash paid for interest	$	522		$	2,862
Cash paid for income taxes	$	—		$	147

Supplemental disclosures of non-cash investing and financing activities:
Gain on debt extinguishment applied to additional paid in capital	$	989		$	—
Gain on debt extinguishment applied to accumulated deficit	$	1,069		$	—
Assets acquired under capital leases	$	541		$	209
Issuance of put option in connection with EDC acquisition	$	74		$	—
Liability to issues shares in business acquisition	$	99		$	964
Consideration payable related to business acquisition	$	—		$	1,704
Issuance of call option in connection with convertible notes payable	$	21		$	—
Issuance of put option in connection with convertible notes payable	$	127		$	—
Issuance of warrants in connection with convertible notes payable	$	1,226		$	—
Issuance of beneficial conversion feature in connection with convertible notes	$	2,953		$	—
Issuance of warrants in connection with Perceptive debt	$	1,511		$	—
Issuance of put option in connection with Perceptive debt	$	1,138		$	—
Goodwill recorded in business combination	$	255		$	210
Accounts payable and liabilities assumed in business acquisition	$	562		$	—
Property, equipment and prepaids acquired in business acquisition	$	230		$	1,498
Intangible assets acquired in business acquisition	$	345		$	1,304
Dividends declared (extinguished) on ordinary shares	$	(623	)	$	—
Unpaid deferred offering costs	$	840		$	—
Unpaid balance for property and equipment	$	1,056		$	783
Extinguishment of warrants with related party	$	—		$	958
Conversion of related party convertible notes payable into ordinary shares	$	—		$	24,248

See notes to consolidated financial statements.

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Table of Contents

ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

1. Formation, Business of the Company and Going Concern

Formation and Business of the Company

Establishment Labs Holdings Inc. (the “Company”) is a global company that manufactures and markets innovative medical devices for aesthetic plastic surgery, reconstructive plastic surgery, and aesthetic dermatology. The Company was established in the British Virgin Islands on October 9, 2013, at which time Establishment Labs, S.A., the Costa Rican manufacturing company, was reincorporated as a wholly-owned subsidiary. The Company also has wholly-owned subsidiaries in the United States (JAMM Technologies, Inc. and Motiva USA LLC), Belgium (European Distribution Center Motiva BVBA), Brazil ( Establishment Labs Produtos para Saude Ltda) , France (Motiva Implants France SAS), Sweden (Motiva Nordica AB) and Switzerland (JEN-Vault AG). Substantially all of the Company’s revenues are derived from the sale of silicone breast implants under the brand of Motiva Implants.

The main manufacturing activities are conducted in two manufacturing facilities in Costa Rica. Beginning in 2010, the Company began operating under the Costa Rica free zone regime (Régimen de Zona Franca) which provides for reduced income tax and other tax obligations pursuant to an agreement with the Costa Rican authorities (see Note 12).

The Company’s products are approved for sale in Europe, the Middle East, Latin America, Australia and Asia. The Company is actively working on obtaining regulatory approval to commercialize its products in the United States. The Company sells its products internationally through distributors as well as making direct sales to customers.

The Company has been expanding its global operations through a series of acquisitions. In November 2015, the Company purchased certain assets from Magna Equities I, LLC and established its wholly-owned subsidiary, JAMM Technologies, Inc., in the United States. In January 2016, the Company purchased a distribution company in Brazil to support the application to sell its products in Brazil. In March 2016, the Company purchased a storage and distribution company in Belgium to support its continued growth in Europe. In September 2016, the Company purchased a distribution company in France and established a wholly-owned subsidiary in Switzerland. In November 2017, the Company acquired certain assets from Femiline AB and established its wholly-owned subsidiary in Sweden, Motiva Nordica AB (see Note 11).

Going Concern

During the year ended December 31, 2017 , the Company incurred a net loss of $ 34.9 million and used $32.0 million of cash in operations. At December 31, 2017 , the Company had an accumulated deficit of $67.9 million and currently does not expect to experience positive cash flows from operations in the near future. The Company has financed operations to date primarily through private placements of debt and equity securities.

On August 24, 2017 the Company entered into a credit agreement, or the Madryn Credit Agreement, with Madryn Health Partners, LP, or Madryn, as administrative agent, and a syndicate of lenders. The Company initially defaulted on the Madryn Credit Agreement on January 19, 2018 when it failed to put a Qualifying Control Agreement in place for certain bank deposit accounts and subsequently on February 28, 2018 when its investment in its Brazilian subsidiary exceeded the allowable $5.0 million threshold permitted under the Madryn Credit Agreement. As a result, on March 23, 2018 and subsequently on April 30, 2018, the Company entered into a forbearance agreement with the Lenders, where the Lenders agreed to forebear from exercising certain rights and remedies through May 18, 2018 arising from certain disclosure and other technical defaults under the Madryn Credit Agreement, including those mentioned above with respect to our Brazilian subsidiary. Accordingly, as the forbearance agreement does not cover a period exceeding twelve months after the date of these financial statements, the Company recorded the Madryn debt as a current liability on the consolidated balance sheet (see Note 6). Management is working with the Lenders to amend the Madryn Credit Agreement to remove the restrictive covenants that resulted in the technical defaults which would allow the Company to reclassify the arrangement as long-term.

Management expects the Company to continue to incur additional losses in the near and intermediate future because of the Company’s activities. The negative cash flows from operations, lack of financial resources of the Company and classification of Madryn debt as current raise substantial doubt as to the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued. Management plans to finance operations through equity or debt financing arrangements; however, if the Company is unable to raise additional funding to meet its working capital needs, if funds are only available at terms unfavorable to the Company, or if management is not able to amend the terms of Madryn Credit Agreement, the Company may be forced to delay or reduce the scope of its capital investment programs and/or limit or cease its operations. The Company will need to raise substantial additional

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Table of Contents

ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

funding in the near term to sustain operations.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which assumes the realization of assets and the settlement of liabilities and commitments in the normal course of business. The consolidated financial statements do not reflect any adjustments relating to the recoverability and reclassification of assets and liabilities that might be necessary if the Company is unable to continue as a going concern.

2. Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP. The consolidated financial statements include the Company’s accounts and those of its wholly-owned subsidiaries as of December 31, 2017 as follows :




Subsidiary	Incorporation/Acquisition Date
Establishment Labs, S.A. (Costa Rica)	January 18, 2004
Motiva USA, LLC (USA)	February 20, 2014
JAMM Technologies, Inc. (USA)	October 27, 2015
Establishment Labs Produtos par Saude Ltda (Brazil)	January 4, 2016
European Distribution Center Motiva BVBA (Belgium)	March 4, 2016
Motiva Implants France SAS (France)	September 12, 2016
JEN-Vault AG (Switzerland)	November 22, 2016
Motiva Nordica AB (Sweden)	November 2, 2017

All intercompany accounts and transactions have been eliminated in consolidation.

Segments

The chief operating decision maker for the Company is the Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a consolidated basis, accompanied by information about revenue by geographic region, for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results or plans for levels or components below the consolidated unit level. Accordingly, the Company has determined that it has a single reportable and operating segment structure. The Company and its Chief Executive Officer evaluate performance based primarily on revenue in the geographic locations in which the Company operates.

Geographic Concentrations

The Company derives all of its revenues from sales to customers in Europe, the Middle East, Latin America, Australia and Asia, and has not yet received approval to sell its products in the United States.

For the year ended December 31, 2016, South Korea accounted for 12% of total consolidated revenue, on a ship-to destination basis. For the year ended December 31, 2017, no individual country exceeded 10% of consolidated revenue.

The Company’s long-lived assets located in Costa Rica represented the majority of the total long-lived assets as of December 31, 2016 and 2017 .

Use of Estimates

The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and

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Table of Contents

ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

accompanying notes. Significant accounting estimates and management judgments reflected in the consolidated financial statements include items such as accounts receivable valuation and allowances, inventory valuation and allowances, valuation of acquired intangible assets, valuation of derivatives, estimation of assets’ useful lives and valuation of deferred income tax assets, including tax valuation allowances. Estimates are based on historical experience, where applicable, and other assumptions believed to be reasonable by management. Actual results may differ from those estimates under different assumptions or conditions.

Concentration of Credit Risk, Other Risks and Uncertainties

Financial instruments that potentially subject the Company to a concentration of credit risk primarily consist of cash, restricted cash and accounts receivable. The majority of the Company’s cash is held at financial institutions in the United States and Costa Rica. The Company has not experienced any losses on its deposits of cash.

All of the Company’s revenue has been derived from sales of its products in international markets, principally Europe, the Middle East, Latin America, Australia and Asia. In the international markets in which the Company participates, the Company uses a combination of distributors to sell its products as well as making direct sales to customers in certain markets. The Company performs ongoing credit evaluations of its distributors and customers, does not require collateral, and maintains allowances for potential credit losses on customer accounts when deemed necessary.

During the year ended December 31, 2016 , one customer accounted for 12.0% of the Company’s revenue. During the year ended December 31, 2017 , no customers accounted for over 10.0% of the Company’s revenue. One customer accounted for 16.0% of the Company’s accounts receivable balance as of December 31, 2016 . No customers accounted for over 10.0% of the Company’s accounts receivable balance as of December 31, 2017 . Substantially all of the Company’s revenues are derived from the sale of silicone breast implants under the brand of Motiva Implants.

The Company relies on NuSil Technology, LLC, or NuSil, as the sole supplier of medical-grade silicone used in Motiva Implants as well as other products that are manufactured under contract to other customers. During the year ended December 31, 2016 and 2017 , the Company had purchases of $4.9 million or 44.0% of total purchases and $10.2 million or 40.6% of total purchases, respectively, from NuSil, and as of December 31, 2016 and 2017 , had an outstanding balance owed to this supplier of $0.7 million and $0.8 million , respectively.

The Company’s future results of operations involve a number of risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, uncertainty of regulatory approval of the Company’s current and potential future products, uncertainty of market acceptance of the Company’s products, competition from substitute products and larger companies, securing and protecting proprietary technology, strategic relationships and dependence on key individuals and sole source suppliers.

Products developed by the Company require clearances from the U.S. Food and Drug Administration or other international regulatory agencies prior to commercial sales. There can be no assurance that the products will receive the necessary clearances. If the Company was denied clearance, clearance was delayed or the Company was unable to maintain its existing clearances, it could have a material adverse impact on the Company.

Cash

The Company’s cash consist of cash maintained in checking and interest bearing accounts. The Company accounts for financial instruments with original maturities of three months or less at the date of purchase as cash equivalents. The Company held no cash equivalents as of December 31, 2016 and 2017 .

Restricted Cash

As of December 31, 2016, the restricted cash balance represented a certificate of deposit collateralizing payment of charges related to the Company's corporate credit card and a deposit related to the Company’s operating lease for its new manufacturing facility in Costa Rica. During 2017, the deposit related to the Company’s manufacturing facility was refunded.

Accounts Receivable and Allowance for Doubtful Accounts

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Table of Contents

ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

assessed based on ongoing credit evaluations and payment history, and the customer’s current financial condition. In cases where there are circumstances that may impair a specific customer’s ability to meet its financial obligations, an allowance is recorded against amounts due, which reduces the net recognized receivable to the amount reasonably believed to be collectible. Historical returns of products have been de minimis and accordingly no allowance for returns was recorded as of December 31, 2016 and 2017.

Inventory and Cost of Revenue

Inventory is stated at the lower of cost to purchase or manufacture the inventory or the net realizable value of such inventory. Cost is determined using the standard cost method which approximates actual costs using the first-in, first-out basis. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand, and remaining shelf life to record a provision for excess and slow-moving inventory. No inventory allowance has been recorded as of December 31, 2016 and 2017.

The Company recognizes the cost of inventory transferred to the customer in cost of revenue when revenue is recognized.

Shipping and Handling Costs

Shipping and handling costs are expensed as incurred and are included in selling, general and administrative (SG&A) expenses. Shipping and handling costs included in SG&A were $0.6 million and $1.3 million for the year ended December 31, 2016 and 2017 , respectively.

Revenue Recognition

The Company recognizes revenue related to sales of products to distributors or directly to customers in markets where it has regulatory approval, net of trade discounts and allowances. The Company recognizes revenue when all of the following criteria are met:

▪ persuasive evidence of an arrangement exists;

▪ the sales price is fixed or determinable;

▪ collection of the relevant receivable is probable at the time of sale; and

▪ delivery has occurred or services have been rendered.

The Company recognizes revenue related to the sales of products to distributors at the time of shipment of the product, which represents the point in time when the customer has taken ownership and assumed the risk of loss and the required revenue recognition criteria are satisfied. The Company’s distributors are obligated to pay within specified terms regardless of when or if they sell the products. The Company’s contracts with distributors do not typically contain right of return or price protection and have no post-delivery obligations.

A portion of the Company’s revenue is generated from the sale of consigned inventory maintained at physician, hospital, and clinic locations. For these products, revenue is recognized at the time the Company is notified by the customer that the product has been implanted, not when the consigned products are delivered to the customer’s warehouse.

The Company has a limited warranty to distributors for the shelf life of the product, which is five years from the time of manufacture. Estimated warranty obligations are recorded at the time of sale. The Company also offers a warranty to patients in the event of rupture and a replacement program for capsular contracture events provided certain registration requirements are met. Revenue for extended warranties are recognized ratably over the term of the agreement. To date, these warranty and program costs have been de minimis. The Company will continue to evaluate the warranty reserve policies for adequacy considering claims history.

Deferred revenue primarily consists of payments received in advance of meeting revenue recognition criteria. The Company has received payments from distributors to provide distribution exclusivity within a geographic area, and recognizes deferred revenue on a ratable basis over the term of such contractual distribution relationship. Additionally, the Company has received payments from customers in direct markets prior to surgical implantation, and recognizes deferred revenue at the time the Company is notified by the customer that the product has been implanted. For all arrangements, any revenue that has been deferred and is expected to be recognized beyond one year is classified as long-term deferred revenue and included in “Other liabilities, long term” on the consolidated balance sheets.

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Table of Contents

ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

Research and Development

Costs related to research and development activities are expensed as incurred. Research and development, or R&D, costs primarily include personnel costs, materials, clinical expenses, regulatory expenses, product development, consulting services, outside research activities, all of which are directly related to research and development activities.

Selling, General and Administrative Expenses

Selling, general and administrative expenses include sales and marketing costs, payroll and related benefit costs, insurance expenses, shipping and handling costs, legal and professional fees and administrative overhead.

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation and amortization.

Goodwill and Intangible Assets

The Company records the excess of the acquisition purchase price over the net fair value of the tangible and identifiable intangible assets acquired and liabilities assumed as goodwill. In accordance with Accounting Standards Codification, or ASC, 350, Intangibles - Goodwill and Other, the Company tests goodwill for impairment annually during the fourth quarter of each year and whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. In connection with the annual impairment test for goodwill, the Company elected the option to perform a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If the Company determines that it was more likely than not that the fair value of the reporting unit is less than its carrying amount, then the impairment test is performed. Consistent with the Company's assessment that it has only one reporting segment, the Company has determined that it has only one reporting unit and tests goodwill for impairment at the entity level using the two-step process required by ASC 350. In the first step, the Company compares the carrying amount of the reporting unit to the fair value of the enterprise. If the fair value of the enterprise exceeds the carrying value, goodwill is not considered impaired and no further testing is required. If the carrying value of the enterprise exceeds the fair value, goodwill is potentially impaired and the second step of the impairment test must be performed. In the second step, the Company compares the implied fair value of the goodwill, as defined by ASC 350, to its carrying amount to determine the impairment loss, if any.

The Company capitalizes certain costs related to intangible assets, such as patents and trademarks and records purchased intangible assets at their respective estimated fair values at the date of acquisition. Purchased finite-lived intangible assets are being amortized using the straight-line method over their remaining estimated useful lives, which range from two to fifteen years. The Company evaluates the remaining useful lives of intangible assets on a periodic basis to determine whether events or circumstances warrant a revision to the remaining estimated amortization period. The Company tests indefinite-lived intangible assets for impairment on at least an annual basis and whenever circumstances suggest the assets may be impaired. If indicators of impairment are present, the Company evaluates the carrying value of the intangible assets in relation to estimates of future undiscounted cash flows. The Company also evaluates the remaining useful life of an indefinite-lived intangible asset to determine whether events and circumstances continue to support an indefinite useful life.

During the years ended December 31, 2016 and 2017 , there has been no impairment of goodwill or intangible assets based on the qualitative assessments performed by the Company.

Long-Lived Assets

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Table of Contents

ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

impairment charges, or changes in estimated useful lives recorded d uring the years ended December 31, 2016 and 2017.

Debt and Embedded Derivatives

The Company applies the accounting standards for derivatives and hedging and for distinguishing liabilities from equity when accounting for hybrid contracts. The Company accounts for convertible debt instruments when the Company has determined that the embedded conversion options should not be bifurcated from their host instruments in accordance with ASC 470-20 Debt with Conversion and Other Options. The Company records, when necessary, discounts to notes payable for the intrinsic value of conversion and other options embedded in debt instruments as a beneficial conversion option based upon the differences between the fair value of the underlying shares at the commitment date of the note transaction and the effective conversion price embedded in the note (see Note 6).

The Company uses option pricing valuation models to determine the fair value of embedded derivatives and records any change in fair value as a component of other income or expense in the consolidated statements of operations (see Note 5).

Debt Issuance Costs and Debt Discounts

Share Warrant Liability

The Company has issued freestanding warrants to purchase shares of its ordinary shares in conjunction with certain debt arrangements. Prior to the adoption of ASU 2017-11 I. Accounting for Certain Financial Instruments With Down Round Features and II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests With a Scope Exception ., the Company classified the fair value of these warrants as liabilities due to the existence of certain cash settlement features that were not within the sole control of the Company and/or existence of a variable settlement provision that caused these warrants not to be indexed to the Company’s own shares. At the end of each reporting period, changes in estimated fair value during the period were recorded in the consolidated statements of operations. The Company used the Monte-Carlo valuation model to determine the fair value of the warrants.

As a result of the complex valuation models used to determine the fair value of the warrants, the valuation of this derivative instrument is subjective because the models require the input of highly subjective assumptions, including the share price and expected volatility. Changes in these assumptions can materially affect the fair value estimate and, such impacts can, in turn, result in material non-cash charges or credits in the consolidated statements of operations as other income or expense. The Company will continue to adjust the liability for changes in fair value until the earlier of the expiration of the warrants, the reclassification of the warrants from a liability to equity, or their exercise.

After the adoption of ASU 2017-11, the Company is no longer required to classify the warrants issued as a liability. As a result, the Company recorded an extinguishment of warrant liability upon the adoption of the new guidance in the second quarter of 2017 (see Note 9).

Income Taxes

The Company records income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s consolidated financial statements or income tax returns. In estimating future tax consequences, expected future events, enactments or changes in the tax law or rates are considered. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized.

The Company operates in various tax jurisdictions and is subject to audit by various tax authorities.

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Table of Contents

ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. Significant judgment is required in the identification of uncertain tax positions and in the estimation of penalties and interest on uncertain tax positions.

There were no material uncertain tax positions in fiscal 2016 and 2017 .

Foreign Currency

The financial statements of the Company’s foreign subsidiaries whose functional currencies are the local currencies are translated into U.S. dollars for consolidation as follows: assets and liabilities at the exchange rate as of the balance sheet date, stockholders’ equity at the historical rates of exchange, and income and expense amounts at the average exchange rate for the month. Translation adjustments resulting from the translation of the subsidiaries’ accounts are included in “Accumulated other comprehensive income (loss).” Transactions denominated in currencies other than the applicable functional currency are converted to the functional currency at the exchange rate on the transaction date. At period end, monetary assets and liabilities are remeasured to the functional currency using exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are remeasured at historical exchange rates. Gains and losses resulting from foreign currency transactions are included within “Other income (expense), net.”

Comprehensive Income (Loss)

The Company’s comprehensive income consists of net loss and foreign currency translation adjustments arising from the consolidation of the Company’s foreign subsidiaries.

Deferred Offering Costs

Deferred offering costs, consisting of legal, accounting and other fees and costs relating to the Company’s planned initial public offering, or IPO, are capitalized within “Other non-current assets” on the consolidated balance sheet. The deferred offering costs will be offset against the proceeds received upon the closing of the planned IPO. In the event the planned IPO is terminated, all of the deferred offering costs will be expensed within loss from operations. As of December 31, 2016 and 2017, $1.1 million and $0, respectively, of deferred offering costs were capitalized. Due to a delayed IPO process beyond 90 days, the Company expensed the previously deferred offering costs of $1.6 million during the year ended December 31, 2017.

Share-Based Compensation

The Company measures and recognizes compensation expense for all stock-based awards in accordance with the provisions of ASC 718, Stock Compensation . Stock-based awards granted include stock options and restricted stock awards, or RSAs. Share-based compensation expense for stock options and RSAs granted to employees is measured at the grant date based on the fair value of the awards and is recognized as an expense ratably on a straight-line basis over the requisite service period. The fair value of options to purchase ordinary shares granted to employees is estimated on the grant date using the Black-Scholes option valuation model.

The Company accounts for stock options and RSAs issued to non-employees under ASC 505-50 Equity: Equity-Based Payments to Non-Employees , using the Black-Scholes option valuation model to value stock options. The fair value of such non-employee awards is remeasured at each quarter-end over the vesting period.

The calculation of stock-based compensation expense requires that the Company make assumptions and judgments about the variables used in the Black-Scholes model, including the expected term, expected volatility of the underlying common shares, risk-free interest rate and dividends.

The Company has adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting , under which it will recognize forfeitures as they occur rather than applying a prospective forfeiture rate in advance (see Note 10).

Net Income (Loss) Per Share

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

units outstanding under the Company’s equity plan are potentially dilutive securities. Because the Company has reported a net loss in all periods presented, diluted net loss per ordinary share is the same as basic net loss per ordinary share for those periods because including the dilutive securities would be anti-dilutive.

Reclassifications

Certain reclassifications have been made to prior year amounts to conform to the current year presentation. These reclassifications have no impact on the financial position, the results of operations or the cash flows of the Company.

Recent Accounting Standards

The Company is an “emerging growth company” as defined in the Jumpstart Our Business Startups Act, or the JOBS Act, enacted in April 2012. The Company intends to take advantage of certain exemptions from various public company reporting requirements including following private company effective dates for new or revised accounting standards.

The following recent accounting pronouncements issued by the Financial Accounting Standards Board, or the FASB, could have a material effect on our financial statements:

Recently Adopted Accounting Standards

In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities From Equity (Topic 480); Derivatives And Hedging (Topic 815): (Part I) Accounting For Certain Financial Instruments With Down Round Features, (Part Ii) Replacement Of The Indefinite Deferral For Mandatorily Redeemable Financial Instruments Of Certain Nonpublic Entities And Certain Mandatorily Redeemable Noncontrolling Interests With A Scope Exception. The standard simplifies the accounting for certain equity-linked financial instruments and embedded features with down round features by no longer requiring entities to consider a down round feature when determining whether a financial instrument is considered indexed to the entity’s own shares and thus can be classified as equity. The guidance must be applied using a full or modified retrospective approach. It is effective for non-public business entities for annual periods beginning after December 15, 2019, and interim periods beginning after December 15, 2020. Early adoption is permitted for financial statements of fiscal years or interim periods that have not yet been issued or that have not yet been made available for issuance. The Company adopted the new guidance in July 2017 on a modified retrospective basis. As a result, certain warrants that were previously classified as a liability due to an existence of down round features became qualified to be classified as equity. The adoption of this standard resulted in $1.0 million reclassification of warrant liability into additional paid in capital as of July 1, 2017.

Recently Issued Accounting Standards

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) , which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition . This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 provides two methods of retrospective application. The first method would require the Company to apply ASU 2014-09 to each prior reporting period presented. The second method would require the Company to retrospectively apply ASU 2014-09 with the cumulative effect recognized at the date of initial application. ASU 2014-09 is effective for non-public business entities beginning in fiscal 2019 as a result of ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, ” which was issued by the FASB in August 2015 and extended the original effective date by one year. In 2016, the FASB issued additional updates to the new revenue standard relating to reporting revenue on a gross versus net basis, identifying performance obligations and licensing arrangements, and narrow-scope improvements and practical expedients, respectively. The effective date of this additional update is the same as that of ASU 2014-09. The Company is currently evaluating the impact of adopting the available methodologies of ASU 2014-09 and the related updated revenue recognition guidance upon its financial statements in future reporting periods. The Company has not yet selected a transition method. The Company is in the process of evaluating the new standard against its existing accounting policies, including the timing of revenue recognition, and its contracts with customers to determine the effect the guidance will have on its financial statements and what changes to systems and controls may be warranted.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

principle of whether the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than twelve months regardless of their classification. Leases with a term of twelve months or less will be accounted for similar to existing guidance for operating leases today. ASC 842 supersedes the previous leases standard, ASC 840 Leases. The standard is effective for non-public business entities for fiscal years beginning after December 15, 2018 and interim periods within fiscal years beginning after December 15, 2020.Early adoption is permitted. The Company is currently evaluating the effects, if any, that the adoption of this guidance will have on its consolidated financial statements.

In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting . This ASU provides amendments to the current guidance on determining which changes to the terms and conditions of share-based payment awards require the application of modification accounting. The effects of a modification should be accounted for unless there are no changes between the fair value, vesting conditions, and classification of the modified award and the original award immediately before the original award is modified. ASU 2017-09 is effective for non-public business entities for annual periods, including interim periods within those annual periods, beginning after December 15, 2017, with early adoption permitted. The adoption of this ASU is not expected to have a material impact on the financial statements.

3. Balance Sheet Accounts

Inventory




	December 31,
	2016		2017
	(in thousands)
Raw materials	$	1,276	$	1,978
Work in process	754		1,132
Finished goods	2,770		10,063
	$	4,800	$	13,173

Property and Equipment, Net




	December 31,
	2016			2017
	(in thousands)
Machinery and equipment	$	971		$	5,473
Vehicles	223			353
Furniture and fixtures	387			2,110
Leasehold improvements	2,591			8,743
Construction in process	10,620			—
Total	14,792			16,679
Less: Accumulated depreciation and amortization	(1,562		)	(3,179		)
	$	13,230		$	13,500

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

Depreciation and amortization expense for property and equipment for the years ended December 31, 2016 and 2017 was $0.4 million and $1.6 million , respectively. The Company entered into capital leases relating to equipment and vehicles and recorded the fair value of the lease payments on the initial contract date, and is amortizing the assets over the term of the leases. As of December 31, 2016 and 2017 , the gross asset value for capital lease assets was $1.1 million and $1.3 million , respectively. Depreciation expense for assets under capital leases was de minimus for the year ended December 31, 2016 and 2017 .

In August 2015, the Company entered into a contract with the Zona Franca Coyol, S.A. to have them build a new manufacturing facility in Costa Rica. The construction of the new 27,900 square foot facility began in November 2015 and was finished during the first quarter of fiscal 2017. The construction costs were paid for by the Company. The Company has an option to purchase the title to the building for approximately $3.5 million and on May 11, 2016 the Company provided notice of the intent to exercise the purchase right and expects the transaction to complete by the end of 2018 . Currently, the Company leases the building from Zona Franca Coyol, S.A. for approximately $28 thousand per month.

4. Goodwill and Other Intangible Assets

Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. Intangible assets resulting from the acquisitions of entities accounted for using the acquisition method of accounting are recorded at the estimated fair value of the assets acquired. Purchased intangibles include certain patents and license rights, 510(k) authorization by the U.S. Food and Drug Administration, or FDA, to sell a medical device and other intangible assets.

The Company’s goodwill and most intangibles at December 31, 2017 are the result of acquisitions of certain assets formerly owned by VeriTeQ Corporation in November 2015 and Femiline AB in November 2017 and business acquisitions of Establishment Labs Brasil Productos para Saude Ltda. in January 2016, European Distribution Center Motiva BVBA in March 2016 and Motiva Implants France in September 2016 (see Note 11). Finite-lived intangibles are amortized over their estimated useful lives based on expected future benefit.

In addition to the intangibles acquired, the Company capitalized certain patent and license rights as identified intangibles based on patent and license rights agreements entered into over the past several years. Additionally, the Company capitalized certain software development costs associated with its development of a manufacturing software module, which the Company began amortizing in fiscal 2017 upon implementation of the software.

The changes in the carrying amount of goodwill during the year ended December 31, 2017 were as follows:




	Balance as of January 1, 2017		Additions		Accumulated Impairment Losses		Balance as of December 31, 2017
	(in thousands)
Goodwill	$	255	$	210	$	—	$	465

Only goodwill related to the 2017 acquisition is deductible for tax purposes (see Note 11).

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

The carrying amounts of intangible assets as of December 31, 2016 were as follows:




	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Estimated Useful Lives
	(in thousands)							(in years)
Patents and license rights	$	1,315	$	(178	)	$	1,137	7-12
510(k) authorization	567		(43		)	524		15
Developed technology	62		(22		)	40		10
Other	17		(8		)	9		2-3
Capitalized patents and license rights not yet amortized	291		—			291
Capitalized software development costs not yet amortized	98		—			98
Total intangible assets, net	$	2,350	$	(251	)	$	2,099

The carrying amounts of intangible assets as of December 31, 2017 are as follows:




	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Estimated Useful Lives
	(in thousands)							(in years)
Patents and license rights	$	1,635	$	(361	)	$	1,274	7-12
Customer relationships	1,304		(40		)	1,264		10
510(k) authorization	567		(80		)	487		15
Developed technology	62		(28		)	34		10
Capitalized software development costs	98		(49		)	49		2
Other	17		(15		)	2		2-3
Capitalized patents and license rights not yet amortized	291		—			291
Total intangible assets, net	$	3,974	$	(573	)	$	3,401

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

The amortization expense associated with intangible assets was $0.2 million and $0.3 million for the years ended December 31, 2016 and 2017 , respectively, all of which was recorded in cost of revenue.

As of December 31, 2017 , the amortization expense related to identifiable intangible assets, with definite useful lives, in future periods is expected to be as follows:




Years Ending December 31,	(in thousands)
2018	$	608
2019	551
2020	551
2021	511
2022	215
Thereafter	674
Total	$	3,110

The Company evaluates the recoverability of goodwill and indefinite-lived intangible assets annually and whenever events or changes in circumstances indicate to us that the carrying amount may not be recoverable. We completed the required impairment review at the end of fiscal 2016 and 2017 and concluded that there were no impairments.

5. Fair Value Measurements

The carrying value of the Company’s cash, restricted cash, accounts receivable, accounts payable and short-term notes payable approximate fair value due to the short-term nature of these items. Based on the borrowing rates available to the Company for debt with similar terms and consideration of default and credit risk, the carrying value of the related-party notes payable approximates its fair value. Warrants and put and call options that qualify for liability treatment are carried at fair value and re-measured at each reporting period.

Fair value is defined as the exchange price that would be received for an asset or an exit price paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs.

The fair value hierarchy defines a three-level valuation hierarchy for disclosure of fair value measurements as follows:


▪	Level I Unadjusted quoted prices in active markets for identical assets or liabilities;


▪	Level II Inputs other than quoted prices included within Level I that are observable, unadjusted quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and


▪	Level III Uno bservable inputs that are supported by little or no market activity for the related assets or liabilities.

The categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy at December 31:




	2016
	Total		Level 1		Level 2		Level 3
	(in thousands)
Liabilities
EDC put option liability	$	36	$	—	$	—	$	36
CPH put option liability	941		—		—		941
Perceptive put option liability	1,165		—		—		1,165
Warrant liability	3,983		—		—		3,983
	$	6,125	$	—	$	—	$	6,125




	2017
	Total		Level 1		Level 2		Level 3
	(in thousands)
Liabilities
Madryn put option liability	$	20,302	$	—	$	—	$	20,302
Madryn call option liability	360		—		—		360
Acquisition-related contingent consideration	964		—		—		$	964
	$	21,626	$	—	$	—	$	21,626

The fair value measurement of the put and call option liabilities, the warrant liability and contingent consideration related to the business acquisition completed in fiscal 2017 is based on significant inputs not observed in the market and thus represents a Level 3 measurement.

At December 31, 2016, the Company estimated the fair value of the warrant liability using a Black-Scholes valuation model. Key assumptions including the probabilities of settlement scenarios, enterprise value, time to liquidity, risk-free interest rates and volatility. The term was based on the remaining contractual term on the measurement date. The risk-free interest rates used in the model were based on U.S. Treasury bill rates for securities equal to the remaining term on the measurement date. The volatility was based on an index of peer companies with a term equal to the remaining term on the measurement date. The expected dividend assumption is based on the Company’s expectation that it will not declare dividends for the foreseeable future.

The liability to issue shares to EDC Motiva BVBA was based on the fair market value of the 18,000 ordinary shares that were required to be issued in connection with the EDC acquisition on each measurement date, which was determined to be $5.50 per share as of March 10, 2016 based on a valuation of the enterprise determined using a discounted cash flow methodology. The Company issued the 18,000 shares to the former shareholder in September 2015, and accordingly, the balance of the liability to issue shares to EDC was zero as of December 31, 2016. The EDC put option liability to sell those same 18,000 shares back to the Company in July 2017 was valued using a probability weighted Black-Scholes model, which determined the fair value of the shares to be $4.11 and $8.28 per share as of March 10, 2016 and December 31, 2016, respectively.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

The Company used the following assumptions to value the EDC put option:

Put Option Liability (EDC)




	December 31, 2016
Volatility	32%
Risk-free interest rate	0.85%
Term (in years)	0.54
Dividend yield	—%

The CPH TU, LP, or CPH, put option liability was calculated using a Monte-Carlo simulation model using subjective assumptions based on the remaining term until the maturity date, including a risk-free rate of 10%, as well as the probability of the put option being exercised prior to the maturity date. The Perceptive put option liability was calculated using a Monte-Carlo simulation model using subjective assumptions based on the remaining term until the maturity date, including a risk-free rate of 10%, as well as the probability of the put option being exercised prior to the maturity date.

The Company estimated the fair value of the Perceptive put option and the Perceptive warrant liability using a Monte-Carlo simulation model. Key assumptions using a Monte-Carlo simulation model include the probabilities of settlement scenarios, enterprise value, time to liquidity, risk-free interest rates and volatility. The estimates of fair value for these instruments are based, in part, on subjective assumptions and could differ materially in the future. Generally, increases or decreases in the fair value of the underlying share would result in a directionally similar impact in the fair value measurement of these liabilities.

In August, 2017 the Company entered into a credit agreement, or the Madryn Credit Agreement, with Madryn Health Partners, LP, or Madryn, as administrative agent, and a syndicate of lenders (see Note 6). The Company determined that the Madryn Credit Agreement contained put options related to early redemption mandatory prepayment terms in case of change in control or an event of default and a call option related to voluntary repayment option. The Company valued these put options and the call option and allocated a fair value of $15.1 million for these identified embedded derivatives as a debt discount on the original commitment date. An additional $5.0 million debt discount was recorded on respective borrowing dates when the Company met the required milestones and borrowed an additional $10.0 million in the fourth quarter of fiscal 2017. The Company revalued the options as of each reporting period, and recorded the change in the fair value in the consolidated statement of operations as other income or expense.

Valuation of the embedded derivatives is complex and requires interest rate simulation, estimating the resultant bond valuation and the resultant pay-off to the option holder. The Company estimated the fair value of the embedded redemption options using the Binomial Lattice Model which is based on generalized binomial option pricing formula. The Binomial Option Pricing Model allows for the possibility of exercise before the end of the option’s life and considers future interest rates, volatility and other data with regards to the Company’s credit rating and credit spread.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

The Company used the following assumptions to value Madryn derivatives:

Put Option Liability (Madryn)




	On Issuance Date (August 24, 2017)	December 31, 2017
Interest rate volatility	21.00%	21.00%
Market yield rate	12.00%	12.50%
Term (in years)	5.85	5.50
Dividend yield	—%	—%

Call Option Liability (Madryn)




	On Issuance Date (August 24, 2017)	December 31, 2017
Interest rate volatility	21.00%	21.00%
Market yield rate	12.00%	12.50%
Term (in years)	5.85	5.50
Dividend yield	—%	—%

On November 17, 2017, the Company and Femiline AB and Johan Anderson, or the Seller, entered into an agreement to purchase certain assets from the Seller. The assets purchased included all existing inventory previously sold by the Company to the Seller, all customer relationships and a covenant not to compete. The aggregate purchase price for the assets purchased was 100,000 Class A Ordinary shares of the Company, contingently issuable upon achievement of specific milestones. Based on the valuation of the Company’s shares performed by a valuation specialist, the contingently issuable shares had an aggregate value of $1.0 million calculated as a product of contingently issuable shares and estimated fair value per share (see Note 11). As the ordinary shares are not publicly traded, the Company must estimate their fair value. The fair value of ordinary shares was determined on a periodic basis by the Company’s Board of Directors, with the assistance of an independent third-party valuation firm.

In order to assess the fair value of our ordinary stock, our business enterprise value, or BEV, is determined and then allocated to each element of our capital structure (ordinary shares, warrants and options). Our BEV is estimated using the income approach and the market approach. The discounted cash flow method, or DCF, estimates the enterprise value based on the estimated present value of future net cash flows the business is expected to generate over a forecasted period and an estimate of the present value of cash flows beyond that period, which is referred to as terminal value. The estimated present value is calculated using a discount rate known as the weighted average cost of capital, which accounts for the time value of money and the appropriate degree of risks inherent in the business. Under the market approach, the enterprise value is based on the multiples of comparable companies and transactions. The BEV is allocated using probability-weighted expected return method, or PWERM, which estimates the fair value of common shares based on an analysis of future values for the enterprise assuming various future outcomes.

As of December 31, 2017, the short term and long term portions of contingent consideration liability is included in “Other liabilities, short term” and “Other liabilities, long term”, respectively.

The estimates are based, in part, on subjective assumptions and could differ materially in the future.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

During the periods presented, the Company has not changed the manner in which it values liabilities that are measured at fair value using Level 3 inputs. The Company recognizes transfers between levels of the fair value hierarchy as of the end of the reporting period. There were no transfers within the hierarchy during the years ended December 31, 2016 or December 31, 2017 .

The fair value of the debt conversion feature liability includes the estimated volatility and risk free rate. The higher/lower the estimated volatility, the higher/lower the value of the debt conversion feature liability. The higher/lower the risk free interest rate, the higher/lower the value of the debt conversion feature liability.

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial instruments as follows:




	Liability to Issue Shares (Magna)			Liability to Issue Shares (EDC)			Put Option Liability (Magna)			Put Option Liability (EDC)			Call Option Liability (CPH)			Put Option Liability (CPH)			Warrant Liability			Put Option Liability (Perceptive)			Acquisition-related Contingent Consideration		Put Option Liability (Madryn)		Call Option Liability (Madryn)
	(in thousands)
Balance at January 1, 2016	$	696		$	—		$	393		$	—		$	21		$	95		$	1,357		$	—		$	—	$	—	$	—
Issuance of financial instruments	—			99			—			74			—			126			2,645			1,138			—		—		—
Change in fair value	21			(13		)	(5		)	(38		)	(21		)	815			1,802			27			—		—		—
De-recognition during period	(717		)	(86		)	(388		)	—			—			(95		)	(1,821		)	—			—		—		—
Balance at December 31, 2016	—			—			—			36			—			941			3,983			1,165			—		—		—
Issuance of financial instruments	—			—			—			—			—			—			—			—			964		20,044		83
Change in fair value	—			—			—			(36		)	—			1,702			4,035			(200		)	—		258		277
Repurchase of warrants	—			—			—			—			—			—			(7,060		)	—			—		—		—
De-recognition during period	—			—			—			—			—			(2,643		)	(958		)	(965		)	—		—		—
Balance at December 31, 2017	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	964	$	20,302	$	360

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

6. Debt

Notes Payable Related Party

In August 2015, the Company entered into agreements with all of the Class Z redeemable convertible preferred shareholders to exchange their outstanding shares and accumulated dividends for notes payable with a principal balance of $4.2 million . Per the original agreement, the notes bear interest at a simple rate of 7% per annum with the interest payments due annually starting March 30, 2017 and a note maturity date of March 31, 2020. Annual payments are due based on achievement of certain annual sales milestones beginning in March 2017. In March, 2017, the Company modified the agreement to defer the interest payments for an additional period, which will be thirty days after the Company successfully completes its planned IPO. Upon the effectiveness of an IPO, the notes will become due and payable in full. During the years ended December 31, 2016 and December 31, 2017 , the Company recorded interest expense of $0.3 million and $0.3 million , respectively, to accrue for interest due on the notes. The Company recorded notes payable related party on the balance sheet as follows:




	December 31, 2016		December 31, 2017
	(in thousands)
Principal	$	4,218	$	4,218
Accrued interest	408		703
Total principal and accrued interest at end of period	$	4,626	$	4,921

Related Party Convertible Notes Payable

In August 2015, the Company entered into a Note and Warrant Purchase Agreement, or the Note Agreement or the Notes, with CPH, a primary shareholder, to borrow up to $15.0 million. The Notes issued pursuant to the agreement bore interest at a simple rate of 10% per annum.

In January and July 2016, the Company amended the Note Agreement to increase the aggregate borrowing limit to $18.0 million and $19.8 million, respectively. In September 2016, the Company entered into an amended agreement with CPH to terminate the warrants originally issued in connection with the Notes, fix the conversion rate, and extend the maturity date.

Unless the Notes were converted by their terms, the Notes would have matured on the “deemed repayment date,” which means the earlier of (i) the repayment date; (ii) the consummation of a “liquidity event”, which includes an IPO, sale of all or substantially all of the Company’s assets, and certain transactions whereby more than 50% of the Company’s equity interests are sold or transferred; or (iii) the date on which the maturity of the obligations under the Notes has been accelerated by CPH after the occurrence of an event of default, provided, however, in no event may the Notes mature prior to payment in full of the Perceptive Credit Holdings, L.P., first lien obligations, or due to an event under parts (i) or (ii) above prior to March 16, 2020.

The Notes contained usual and customary events of default upon the occurrence of certain events, such as nonpayment of amounts due under the credit agreement, violation of the restrictive covenants, violation of other contractual provisions, or a material adverse change in its business. The Notes also contained cross default provisions such that if the Company is in default under other credit agreements such that the principal amounts of those agreements can be accelerated, the Notes may also be determined to be in default. The Notes included customary administrative covenants, including a prohibition on declaring dividends, and includes certain financial maintenance and operating related covenants.

As of December 31, 2016 , the Company did not meet certain financial covenants under the Perceptive credit agreement and, as such, recorded the Perceptive debt as a current liability on the consolidated balance sheet. Further, due to the cross default provisions present in the CPH debt, the Company also classified the CPH Related Party Convertible Notes as current on the consolidated balance sheet as of December 31, 2016.

The first closing of $10.0 million occurred in August 2015, the second closing of $3.0 million occurred in January

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

2016, the third closing of $5.0 million occurred in March 2016 and the fourth closing of $1.8 million occurred in July 2016. At December 31, 2016 , accrued interest for these Notes totaled $4.4 million . In September 2016, the Company and CPH entered into an amendment to the Note Agreement under which the outstanding principal and interest became convertible into ordinary shares at the option of CPH at any time based on a fixed ratio of $3.99 per share for the outstanding principal and $4.9143 per share for the outstanding interest. The Company determined the fair value of the conversion option to be $0.5 million, which was recorded as a debt discount to the Notes and within additional paid-in capital. The Company determined that the conversion option did not meet the definition of a derivative and accordingly it was not bifurcated. The debt discount was being amortized over the term of the Notes. The discount to Notes for the intrinsic value of conversion options embedded in the debt instrument was based upon the differences between the fair value of the underlying ordinary shares at the commitment date of the note transaction and the effective conversion price embedded in the Note.

In connection with the Notes, the Company issued warrants for the purchase of ordinary shares to CPH and to Rockport Ventures, the placement agent. The estimated fair value of the warrants issued in August 2015 was determined to be $1.1 million, which was recorded as a debt discount and was being amortized using the effective interest rate method over the term of the Notes (see Note 9).

In August 2015, the first tranche of the Note financing was completed for $10.0 million, with a future close of $5.0 million to be completed within 180 days. The right to participate in a future closing is a liability-classified call option tranche liability, which was determined to be a freestanding financial instrument because they are freely transferable and separately exercisable. The Company determined the fair value of this call option was $24,000, which was recorded as a debt discount to the Notes. At the end of each reporting period, the Company has determined the fair value of the future tranche liability, and recorded any changes in fair value in the consolidated statement of operations as other income or expense. At the expiration of the option period on March 31, 2016 when the final tranche was funded, the Company recorded the change in fair value, and de-recognized the tranche liability upon closing.

The Company also determined that the Note Agreement contained several put options related to liquidity events or an event of default. The Company valued these put options, and allocated the fair value of $0.1 million for these identified embedded derivatives as a debt discount on the original commitment date in August 2015. The Company revalued the put options as of each reporting period, and recorded the change in the fair value in the consolidated statement of operations as other income or expense (see Note 5). The Company also incurred legal expenses of $0.1 million, which were recorded as a debt discount and were being amortized over the term of the Notes.

January 2016 Amendment

In January 2016, the Company entered into an amended Note Agreement to borrow an additional $3.0 million. In accordance with ASC 470-50 Debt: Modifications and Extinguishments , the Company has determined that the increase in the borrowing limit represented a substantial change to the debt agreement resulting in an extinguishment of the original debt agreement. Accordingly, the Company has derecognized the unamortized debt discount of $2.1 million outstanding as of December 31, 2015. Because the Notes were entered into with a related party, the Company has recorded the extinguishment as a capital transaction, and has recorded the derecognized amounts in equity in the consolidated balance sheet during the first quarter of fiscal 2016.

At the time of the $3.0 million tranche closing in January 2016, the Company issued new warrants to the debt holders. The estimated fair value of the warrants issued in January 2016 was determined to be $0.4 million, which was recorded as a debt discount and amortized over the term of the Notes. After allocating $0.4 million to the warrants, the Company determined the fair value of the conversion option to be $1.2 million, which was recorded as a debt discount to the Notes and within additional paid-in capital. The debt discount was being amortized over the term of the Notes using the effective interest method.

At the time of the $5.0 million tranche closing in March 2016, the Company issued new warrants to the debt holders and the placement agent. The estimated fair value of the warrants issued in March 2016 was determined to be $0.8 million, which was recorded as a debt discount and amortized over the term of the Notes. After allocating $0.8 million to the warrants, the Company determined the fair value of the conversion option to be $0.8 million, which was recorded as a debt discount to the Notes and within additional paid-in capital. The debt discount was being amortized over the term of the Notes using the effective interest method.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

In connection with the note agreement, the Company paid Rockport Ventures a cash placement fee of 6% of the principal amount borrowed, up to $15.0 million in principal. In conjunction with the first closing in August 2015, the Company paid Rockport Ventures $0.6 million. These fees were recorded as a debt discount, which was being amortized over the debt repayment period.

During the year ended December 31, 2016 and December 31, 2017 , the Company recorded amortization of $1.5 million and $2.6 million, respectively, of debt discount related to the Note Agreement with CPH in the consolidated statement of operations as interest expense.

July 2016 Amendment

In July 2016, the Company entered into an amended Note Agreement to borrow an additional $1.8 million. In accordance with ASC 470-50, the Company determined that the increase in the borrowing limit represented a substantial change to the debt agreement resulting in an extinguishment of the original debt agreement. Accordingly, the Company has derecognized the unamortized debt discount of $2.9 million outstanding as of the amendment date. Because the Notes were entered into with a related party, the Company recorded the extinguishment as a capital transaction, and recorded the derecognized amounts in equity in the consolidated balance sheet during the third quarter of 2016. At the time of the amendment, the Company evaluated the Notes to determine if there was a beneficial conversion feature, and determined the fair value of the conversion option to be $0.6 million, which was recorded as a debt discount to the Notes and within additional paid-in capital. The debt discount was being amortized using the effective interest method over the term of the Notes.

September 2016 Amendment

In September 2016, the Company and CPH entered into an amendment to the Note Agreement to terminate the warrants originally issued in connection with the Notes and fix the conversion rate on the principal amounts outstanding to a price of $3.99 per share and the interest at $4.9143 per share, and extended the maturity date of the notes to March 2020. In accordance with ASC 470-50, the Company determined that change to the conversion ratio and the termination of the warrants represented a substantial change to the debt agreement resulting in an extinguishment of the original debt agreement. Accordingly, the Company extinguished the $1.8 million warrant liability on the date of termination, as well as the outstanding unamortized debt discount of $0.5 million. Because the transaction was a related party, the Company recorded the extinguishment as a capital transaction and recorded the amounts in equity in the consolidated balance sheet during the third quarter of fiscal 2016.

During the year ended December 31, 2016 , the Company recorded a total of $5.5 million in extinguishment of debt discounts related to various amendments of the Note Agreement, as described above. The Company recorded the Notes as a “Related party convertible notes payable, including accrued interest” on the balance sheet as follows:




	December 31, 2016
	(in thousands)
Principal	$	19,840
Accrued interest	4,408
Total principal and accrued interest	24,248
Net debt discount	(2,940		)
Net carrying value of convertible notes payable, including accrued interest	$	21,308

August 2017 Conversion

On August 24, 2017, CPH elected to convert the principal and the accrued interest outstanding under the Notes into 5,869,417 shares of the Company’s Class B ordinary shares. The related beneficial conversion feature liability was amortized into non-cash interest expense while the CPH put option liability expired upon the conversion of the notes.

There is no outstanding balance under the Notes as of December 31, 2017 .

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

Perceptive Debt

In September 2016, the Company entered into a credit agreement and guaranty with Perceptive Credit Holdings, LP., or Perceptive. The note bore interest of 11% per annum, plus the greater of (i) 1% or (ii) the one-month LIBOR rate, and required no payment of principal for the first twelve months after the closing date. Thereafter, the Company was responsible for making monthly principal payments of $0.2 million plus accrued interest through the maturity date of September 28, 2019. If the Company prepayed the borrowings prior to the maturity date, it would have been responsible for paying a prepayment premium of 5% if the prepayment occurs within 12 months of the initial borrowing date, and 3% if the prepayment occurs after the first anniversary through the stated maturity date.

In connection with this credit agreement, the Company borrowed $15.0 million, and issued fully-vested warrants to purchase 566,500 ordinary shares, which were exercisable for a period of five years. In the event the Company completed a qualified IPO on or before July 31, 2017, the exercise price of the warrants would have been automatically adjusted to equal 50% of the per-share price of the common shares sold in the offering. If the warrant holder exercises the warrant prior to July 31, 2017, the exercise price shall be $3.99 per share. If an IPO had not been completed by July 31, 2017, the exercise price would become $0.01 per share. The initial public offering was not completed by July 31, 2017, and therefore the exercise price became $0.01 per share on August 1, 2017.

If the Company was in default on the warrant agreement, the Company would have been been obligated to redeem the warrant shares based on the average fair market value of the warrant shares for the preceding 15 days prior to the event of default. The Company classified the fair value of these warrants as liabilities on the consolidated balance sheet because of a variable settlement provision that cause them to not be indexed to the Company’s own shares. At the end of each reporting period, changes in estimated fair value during the period were recorded in the consolidated statements of operations as other income or expense. The Company uses the a Monte-Carlo valuation model to determine the fair value of the warrants, which it determined to be $1.5 million on the grant date. The Company also determined that the credit agreement contained an embedded derivative put option in the case of a liquidity event, which has been recorded as a $1.1 million debt discount on the commitment date. The debt discounts were amortized using the effective interest method over the term of the credit agreement. During the year ended December 31, 2016, the Company recorded amortization of $0.3 million of debt discount in the consolidated statement of operations as interest expense.

In connection with the signing of the credit agreement, the Company paid a nonrefundable upfront fee of $0.2 million.

The agreement contained usual and customary events of default upon the occurrence of certain events, such as nonpayment of amounts due under the credit agreement, violation of the restrictive covenants, violation of other contractual provisions, or a material adverse change in its business. The agreement included customary administrative covenants, including a prohibition on declaring dividends, and included certain financial maintenance and operating related covenants. As of December 31, 2016, the Company did not meet certain financial covenants, and obtained a waiver from Perceptive through February 10, 2017 (the date of the waiver and first amendment). Subsequent to February 10, 2017, the Company continued to be in default with the Perceptive debt. Accordingly, as of December 31, 2016, the Company has recorded the Perceptive debt as a current liability on the consolidated balance sheet. Under a condition of default, the interest rate on the credit agreement would have been increased from 11% per annum to 15% per annum during the period in which the Company were in default.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

The Company has recorded Perceptive debt on the balance sheet as follows:




	December 31, 2016
	(in thousands)
Principal	$	15,000
Accrued interest	—
Total principal and accrued interest at end of period	15,000
Net unamortized debt discount	(2,985		)
Net carrying value of Perceptive debt	$	12,015

In February 2017, the Company amended the credit agreement and guaranty with Perceptive in order to (1) remove the requirement to repay 30% of the Net Cash Proceeds (as defined in the credit agreement and guaranty) if the Company’s IPO secured gross proceeds of $40 million or more, (2) waive any defaults in effect up to and including the date of the amendment and (3) certain other changes. The Company received a waiver of any default condition from Perceptive through February 10, 2017.

In August 2017, the obligations due under the credit agreement were fully repaid. The related Perceptive put option liability was extinguished upon the repayment date. The Company repurchased 358,783 warrants for $4.7 million of which $2.3 million is still outstanding as of December 31, 2017. The outstanding amount is due to be paid August 1, 2019 and is included in “Other liabilities, long-term”.

In August 2017, the Company also entered into an Assignment Agreement with Madryn and Perceptive in connection with the repayment of the principal outstanding under the Perceptive credit agreement. Under this agreement, Perceptive assigned to Madryn 207,716 warrants with an exercise price of $0.01 in exchange for $2.4 million. Madryn paid this amount directly to Perceptive and was issued 207,716 shares of Series B ordinary stock by the Company on August 24, 2017 with a deemed fair value of $11.55 per share upon the exercise of the warrants.

Notes Payable, Short-term

In December 2016, the Company entered into a note agreement to borrow $0.2 million from executive officer of the Company, this note remained outstanding as of December 31, 2016. The balance was repaid in 2017.

In January 2017, the Company issued secured promissory notes to Mr. Chacon Quiros, the Company’s Chief Executive Officer and director, and to Crown Predator Holdings, LLC, a related party, in an aggregate principal amount of $1.2 million under existing note purchase, security and pledge agreements. These promissory notes were repaid by the Company in January 2017 and April 2017.

In April 2017, the Company entered into a revolving credit agreement with Banco Davivenda Costa Rica S.A. in an aggregate principal amount of $2.0 million to be used for the purchase of raw materials and components. The Company closed this facility in the second quarter of 2017 and does not have any outstanding balance on this facility as of December 31, 2017 .

Liability to Repurchase Shares

In September 2016, the Company entered into a share repurchase agreement with Global Silicone SRL for the repurchase of 813,140 ordinary shares of the Company owned by Global Silicone SRL in exchange for $3.7 million. The Company has recorded the liability of $3.7 million as of September 30, 2016 on the consolidated balance sheet upon the return of the share certificate to the Company. In October 2016, the Company paid $2.0 million to Global Silicone to repurchase 440,040 shares. As of December 31, 2016, the Company recorded a liability of $1.7 million for the remaining obligation to repurchase the remaining 373,100 shares, which was paid in April 2017. Upon repurchase, the shares were classified as treasury shares and are considered issued but not outstanding.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

Madryn Debt

On August 24, 2017 the Company entered into a credit agreement, or the Madryn Credit Agreement, with Madryn Health Partners, LP, or Madryn, as administrative agent, and a syndicate of lenders. The Madryn Credit Agreement provides for a credit facility for a maximum principal amount of $55.0 million , $30.0 million (Term A) of which became available upon signing. The final maturity date under the Madryn Credit Agreement is June 30, 2023.

The availability of the additional Term B and Term C commitments under the Madryn Credit Agreement, which are for an aggregate principal amount of up to $25 million, are subject to the Company achieving certain revenue milestones. The Company met some of these milestones and borrowed an additional $5.0 million (Term B-1) on October 31, 2017 and $5.0 million (Term B-2) on December 15, 2017 bringing up the total outstanding principal balance to $40.0 million as of December 31, 2017. An additional $5.0 million (Term B-3) and $10.0 million (Term C) may become available on M arch 29, 2018 and June 30, 2020, respectively, if the required milestones for each tranche are achieved. The Company has not yet met the required milestones for the Term B-3 or Term C tranche as of the date of the issuance of these financial statements. The availability of each tranche is also conditioned on the Company having advanced the maximum loan amount under each prior tranche.

In connection with the Madryn Credit Agreement, the Company and certain of its subsidiaries, granted a security interest in substantially all of the property of the Company and certain of its subsidiaries, including, without limitation, intellectual property, and pledges of certain stock of the Brazilian subsidiary and the Belgian subsidiary, subject to certain excluded collateral exceptions.

Borrowings under the Madryn Credit Agreement bear interest at a rate equal to 3-month LIBOR plus 11.0% per annum provided that no default has occurred. In an event of a default, the interest would increase by an additional 4% per annum. The Company incurred $1.4 million in interest expense in connection with Madryn Credit Agreement in fiscal 2017. No principal payments are due until 2021. Eight quarterly payments of 12.5% of the principal amounts borrowed under each tranche are due beginning September 30, 2021 and each quarter end through and including June 30, 2023.

The Company also determined that the Madryn Credit Agreement contained put options which are mandatory repayment provisions related to liquidity events or an event of default and a call option related to voluntary repayment option. The Company valued these put options and the call option, and allocated a fair value of $15.1 million for these identified embedded derivatives as a debt discount on the original commitment date in August 2017. An additional $5.0 million debt discount was recorded on respective borrowing dates when the Company met the required milestones and borrowed an additional $10.0 million in the fourth quarter of fiscal 2017. The Company revalues the options as of each reporting period, and records the change in the fair value in the consolidated statement of operations as other income or expense (see Note 5). The Company also incurred legal expenses of $1.3 million , which were recorded as a debt discount and are being amortized over the term of the Madryn Credit Agreement.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

$5.0 million, and maintain the liquidity in accounts for which Madryn received a qualifying control agreement of no less than $2.0 million, while the Company provides periodic reports on all investments in the Brazilian subsidiary. The forbearance agreement also forbears the lenders from exercising certain rights and remedies in the event of our failure to provide the report and opinion of an independent certified public accountant free from any “going concern” qualifications for the fiscal year ended December 31, 2017.

Accordingly, the Company recorded the Madryn debt as a current liability on the consolidated balance sheet. As of December 31, 2017 , the Company recorded Madryn debt on the balance sheet as follows:




	December 31, 2017
	(in thousands)
Principal	$	40,000
Accrued interest	—
Total principal and accrued interest at end of period	40,000
Net unamortized debt discount and issuance costs	(20,833		)
Net carrying value of Madryn debt	$	19,167

Concurrently, the Company also granted Madryn the right to purchase up to 357,143 shares of Series F ordinary stock for $5.0 million at the lower of $14.00 per share or 85% of the next offering. Madryn purchased the shares in multiple closings in August and October 2017 (see Note 8).

In addition, the Company granted Madryn the right to purchase up to $2.0 million of shares issued by the Company in the next succeeding eligible equity investment in the Company. Under this agreement, to the extent the Company redeems or repurchases any shares from any holder, the Company shall offer to resell one half of the repurchased shares to Madryn at the same price paid by the Company to purchase or retire the shares. To the extent Madryn elects to purchase the repurchased shares, the amount paid by Madryn shall reduce the amount of investment available in the next eligible equity investment. The Company has not repurchased shares since August 2017.

7. Commitments and Contingencies

Operating Leases

We lease certain facilities under various operating leases. Most of the lease agreements provide us with the option of renewing our leases at the end of the initial lease term, at fair market rates. In most cases, we expect that in the normal course of business, facility leases will be renewed or replaced by other leases.

Rent expense for the years ended December 31, 2016 and December 31, 2017 was $0.1 million and $0.8 million , respectively.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

Future minimum lease payments under the operating leases as of December 31, 2017 are as follows:




Years Ending December 31,	Operating Leases
	(in thousands)
2018	$	738
2019	610
2020	580
2021	503
2022	524
Thereafter	2,056
	$	5,011

Capital Leases

The Company entered into capital leases relating to software, equipment and vehicles. The lease periods are from one to seven years from the inception date. The repayments are made monthly with an interest rate ranging from 4% to 7% per year. Future minimum lease payments under the capital leases as of December 31, 2017 are as follows:




Years Ending December 31,	Capital Leases
	(in thousands)
2018	$	335
2019	319
2020	227
2021	132
2022	34
Thereafter	—
	1,047
Interest included in the above payments	(133		)
Amount payable without interest	914
Short term minimum capital lease payments (included in accrued liabilities)	315
Long term minimum capital lease payments	$	599

Contingencies

From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business activities. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. There have been no contingent liabilities requiring accrual or disclosure at December 31, 2016 and December 31, 2017 .

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

Indemnification

The Company enters into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to the Company’s technology. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made.

The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual.

The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with such indemnifications has been recorded to date.

8. Shareholders’ Equity (Deficit)

General

In October 2016, the Company filed amended and restated memorandum of association and articles of association (“Articles”) to increase the authorized shares of the Company. Under the Articles in effect as of December 31, 2016, the Company had authorized 84,050,000 common shares with a par value of $1.00 per share, 14,295,922 Class A ordinary shares with a par value of $1.00 per share, 1,646,714 Class B ordinary shares with a par value of $1.00 per share, and 7,364 Class Z redeemable convertible preferred shares with a par value of $500.00 per share.

In 2017, the Company filed amended and restated Articles several times to increase the authorized shares. Under the Articles in effect as of December 31, 2017, the Company had authorized 84,050,000 common shares with a par value of $1.00 per share, 13,482,782 Class A ordinary shares with a par value of $1.00 per share, 7,723,848 Class B ordinary shares with a par value of $1.00 per share, 96,301 Class C ordinary shares with no par value, 1,539,359 Class D ordinary shares with no par value, 323,366 Class E ordinary shares with no par value and 357,143 Class F ordinary shares with no par value.

Common Shares

No common shares have been issued to date.

Redeemable Convertible Preferred Shares

In August 2015, all 7,364 outstanding Class Z redeemable convertible preferred shares and accumulated dividends were exchanged for promissory notes issued by the Company to the former Class Z shareholders. The Company recorded the exchange as a reduction in outstanding preferred shares and an increase in “Notes payable related party, including accrued interest” on the consolidated balance sheet. The purchase of the outstanding preferred shares was accounted for as a treasury shares transaction, under which the repurchased shares were considered issued but not outstanding.

As of December 31, 2016 , no Class Z redeemable convertible preferred shares were outstanding. The Class Z redeemable convertible preferred shares were retired in May 2017.

The Class Z redeemable convertible preferred shares had the following rights as of December 31, 2016:

Redemption. The redeemable convertible preferred shares are redeemable at par value plus unpaid dividends upon a vote of the Company’s Board of Directors at any time.

Voting. The redeemable convertible preferred shares do not have the right to vote on any matters.

Dividends. The holders of the Class Z redeemable convertible preferred shares are entitled to receive, whether or not declared by the Board of Directors, a cumulative cash dividend on each outstanding redeemable convertible preferred share. The dividend rate will be 10% on the share par value for each period which dividends have not been paid and 7.5% for the period in which payments have been approved. Such dividends shall be payable only when, as and if declared by the Board of Directors.

Liquidation. Upon liquidation, the Class Z redeemable convertible preferred shareholders are entitled to receive an equal

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

share in the distribution of surplus assets, after payment has been made to certain holders of ordinary shares equal to the par value plus simple interest of 8% per annum.

Conversion. Prior to the exchange for a note payable, the holders of the shares of Class Z redeemable convertible preferred shares were permitted to exchange their shares for ordinary shares after April 1, 2018. The conversion rate for the exchange was to be based on a conversion ratio to be determined on the conversion date based on the valuation of the shares at that time.

Ordinary Shares

As of December 31, 2016 and 2017 , 7,118,753 and 15,743,705 shares, respectively, of ordinary shares were issued and 6,305,613 and 14,522,495 shares, respectively, were outstanding.

Class A and B

As of December 31, 2016 and 2017 , 7,118,753 and 13,427,536 shares, respectively, of ordinary Class A and Class B shares were issued and 6,305,613 and 12,206,326 shares, respectively, were outstanding. Class A and Class B ordinary shares have a par value of $1.00 per share.

In connection with a business purchase agreement with EDC Motiva BVBA entered into in March 2016, the Company agreed to issue the former shareholder 18,000 ordinary shares. In September 2016, the Company issued the 18,000 shares to the former shareholder. Also in connection with the purchase agreement, the Company issued the former shareholder the right to sell the 18,000 ordinary shares issued in the acquisition back to the Company between July 1 and July 15, 2017 for $0.25 million. This liability-classified put option has been determined to be a freestanding financial instrument because it is freely transferable and separately exercisable. The Company recorded an initial fair value of $0.1 million for the put option as a part of the purchase price consideration. The Company recorded any change in fair value in the consolidated statement of operations as other income or expense. As of December 31, 3016, the Company had recorded a put option liability of $36,000 on its consolidated balance sheets for this obligation. The put option expired in July 2017.

In July 2017, the obligations under the Related Party Convertible Notes with CPH were extinguished upon the exercise of the conversion feature. CPH was issued 5,869,417 Class B ordinary shares (see Note 6). Also , the Company paid $2.8 million to repurchase additional 406,570 Class A ordinary shares from Global Silicone SRL.

In 2016 and 2017, the Company issued restricted stock awards to employees and contractors. The Company records the awards as outstanding equity as they vest (see Note 10).

In August 2017, Madryn purchased 73,560 Class A ordinary shares at $8.84 per share and 93,580 Class A ordinary shares at $12.50 per shares from other shareholders.

In November, 2017, the Company entered into an agreement to purchase certain assets for an aggregate purchase price of 100,000 Class A Ordinary shares, contingently issuable upon achievement of specific milestones. Concurrently, the Company bought back distribution rights for a payment of $1.0 million in cash and 35,714 Class A ordinary shares (see Note 11).

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

Ordinary Class A and B shares had the following rights as of December 31, 2016 and 2017:

Voting Rights. Each holder of the Company’s ordinary shares is entitled to one vote for each share on all matters submitted to a vote of the shareholders, including the election of directors.

Protective Provisions. As long as CPH TU, L.P. and its affiliates continue to hold at least 25% of the Class B Ordinary Shares, the Company cannot do the following without the consent of CPH TU, L.P.:


a.	liquidate, dissolve or wind-up the business and affairs of the Company, effect any merger or consolidation or any other Deemed Liquidation Event, as defined in the Articles , or consent to any of the foregoing;


b.	amend, alter or repeal any provision of the Memorandum and the Articles;

create, or authorize the creation of, or issue or obligate itself to issue shares of, any additional class or series of shares unless the same ranks junior to the Class G Ordinary Shares, Class F Ordinary Shares, Class E Ordinary Shares, Class D Ordinary Shares, Class C Ordinary Shares, Class B Ordinary Shares and the Class A Ordinary Shares of the Company (with respect to the distribution of assets on the liquidation, dissolution or winding up of the Company, the payment of dividends and rights of redemption, or increase the authorized number of Ordinary Shares);

create, or authorize the creation of, or issue, or authorize the issuance of any debt security, or permit any subsidiary to take any such action with respect to any debt security, if the aggregate indebtedness of the Company and its subsidiaries for borrowed money following such action would exceed US$500,000, including any debt security issued for the financing of the construction or purchase of a new production facility, unless such debt security has received the prior approval of the Board, including at least one of the Investor Directors;

create, or hold shares in any subsidiary that is not wholly owned (either directly or through one or more other subsidiaries) by the Company, or sell, transfer or otherwise dispose of any shares of any direct or indirect subsidiary of the Company, or permit any direct or indirect subsidiary to sell, lease, transfer, exclusively license or otherwise dispose (in a single transaction or series of related transactions) of all or substantially all of the assets of such subsidiary;


f.	encumber or grant a security interest in any of the Company’s property (tangible or intangible) or business;


g.	grant an exclusive license for, or create a negative pledge for, all or substantially all of the Company’s intellectual property assets;


h.	authorize a non pro-rata Distribution;


i.	increase or decrease the authorized number of directors constituting the Board; or


j.	permit any subsidiary to do any of the foregoing.

Redemption. The ordinary shares may be redeemed by the Company at any time based on a resolution of the Board of Directors.

Dividends. Holders of the Company’s ordinary shares are entitled to receive dividends, if any, as may be declared from time to time by its Board of Directors out of legally available funds. In accordance with the memorandum and articles of association, upon the declaration and payment of consideration on Class Z preferred shares, certain holders of 2,173,663 ordinary shares had a preferential right to the same amount of consideration. In August 2015 in connection with the repurchase of Class Z preferred shares in exchange for a note payable, the Company accrued $0.6 million for consideration due to these certain ordinary shareholders in accordance with the right in effect at the time. The Company recorded this as an accrued liability in the consolidated balance sheets. As of December 31, 2015 the earned dividends had not been paid out to shareholders and was recorded as a accrued dividend payable on the consolidated balance sheet. In October 2016, the Company amended its memorandum and articles of association to remove the preferential rights of certain ordinary shareholders to receive distributions on their ordinary shares in advance of the preferred shares. As a result of the amendment to the articles of association, the Company has de-recognized the accrued dividend payable on the consolidated balance sheet as of December 31, 2016. Because the transaction was between related parties, the Company has recorded the reversal as a capital transaction through additional paid-in-capital on the

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

consolidated balance sheet.

Liquidation. In the event of liquidation, dissolution or winding up, holders of its ordinary shares will be entitled to share ratably in the net assets legally available for distribution to shareholders after the payment of all of its debts and other liabilities.

Class C, D, E and F

As of December 31, 2017 , 2,316,169 shares of ordinary Class C, D, E and F shares were issued and outstanding. Class C, D, E and F shares have no par value and were authorized and issued in fiscal 2017.

In 2017, the Company amended it’s Articles to create and authorize Class C, D, E and F no par value ordinary shares. As of December 31, 2017, all authorized Class C, D, E and F ordinary shares were issued and outstanding.

In January 2017, the Company issued an aggregate of 96,301 Class C ordinary shares at a purchase price of $9.53 per share to several investors, and the Company issued an aggregate of 1,539,359 Class D ordinary shares at a purchase price of $11.30 per share to several investors in multiple closings between February 2017 and May 2017.

In July 2017, the Company issued an aggregate of 323,366 Class E ordinary shares at a purchase price of $14.00 per share to several investors. The Company also issued an aggregate of 357,143 Class F ordinary shares at a purchase price of $14.00 per share to Madryn in multiple closings in August and October 2017.

The documents effecting the sale and issuance of these shares contain customary voting, registration, right of first refusal and co-sale rights.

Class C, D, E and F ordinary shares have the following rights:

Voting Rights. Each holder of the Company’s ordinary shares is entitled to one vote for each share on all matters submitted to a vote of the shareholders provided the holders of each class vote together with the holders of other classes of ordinary shares and not as a separate class.

Protective Provisions. As long as any Class D Ordinary Shares remain outstanding, the Company cannot (1) amend the preferences, rights or privileges of the Class D Ordinary Shares or (2) pay or declare a dividend or distribution without the consent of the holders of a majority of the Class D Ordinary Shares.

Price Adjustments for Future Equity Financings. Class F Ordinary Shares are entitled to a Price Adjustment in the event of an IPO of less than $15.00 per share or a private offering of less than $14.00 per share, subject to the terms and limitations as stated in the Articles. For private offerings of less than $14.00 per share, each Class F Ordinary Share shall convert into Common Shares equal to the quotient of $14.00 divided by the private offering price multiplied by 0.85. The Price Adjustment obligation terminates upon the closing of an IPO of not less than $35.0 million.

Redemption. The ordinary shares may be redeemed by the Company at any time based on a resolution of the Board of Directors.

Dividends. Holders of the Company’s ordinary shares are entitled to receive dividends, if any, as may be declared from time to time by its Board of Directors out of legally available funds.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

As of December 31, t he Company had reserved ordinary shares for future issuances as follows:




	2016	2017
Shares issuable on conversion of related-party convertible notes payable	5,869,417	—
Warrants to purchase ordinary shares	726,074	145,000
Options to purchase ordinary shares	793,451	863,932
Remaining shares available under the 2015 Equity Incentive Plan	488,499	91,181
Shares issuable on vesting of restricted stock awards	454,154	585,056
Total	8,331,595	1,685,169

9. Warrants

CPH

In connection with the Notes issued to CPH in August 2015, the Company agreed to issue warrants to purchase ordinary shares to CPH and to Rockport Ventures, the placement agent for the Notes. In September 2016, the Company entered into an amended Note Agreement with CPH, under which the outstanding warrants were canceled (see Note 6).

For CPH, the number of shares for which the warrant may have been exercised was determined by dividing an amount equal to 17.5% of the principal on each borrowing date by a pre-determined ratio of the fully diluted shares outstanding on the date of conversion. The warrants were immediately exercisable and would have expired 10 years from the original issuance date. For Rockport Ventures, the number of shares for which the warrant may have been exercised was determined by dividing an amount equal to 3% of the principal on each borrowing date for up to $15.0 million borrowed by a pre-determined ratio of the fully diluted shares outstanding on the date of conversion. The Rockport Ventures warrants could also be “net-exercised” for no consideration and settled in Class B Ordinary Shares. The Rockport Ventures warrants were immediately exercisable and will expire seven years from the original issuance date.

In March 2017, the Rockport Warrants were canceled and new warrants for the purchase of 145,000 Class B ordinary shares were issued to parties related to Rockport Ventures, with a fixed exercise price of $3.80 per share.

As of December 31, 2016, the Company has classified the fair value of these warrants as liabilities on the balance sheet due to the existence of certain cash settlement features that are not within the sole control of the Company and variable settlement provision that cause them to not be indexed to the Company’s own shares.

The value of the CPH warrants was estimated using the Black-Scholes valuation model which approximates a Lattice valuation model, and at issuance, the Company initially recorded the fair value of the warrants as a debt discount against the related loan balance in its consolidated balance sheet. The recorded value of the warrants is being amortized to interest expense over the estimated repayment term of the related loans. The value of the Rockport Ventures warrants was estimated using the Black Sholes valuation model which approximates a Lattice valuation model, and at issuance, the Company initially recorded the fair value of the warrants as a debt offering cost against the related loan balance in its balance sheet. The recorded value of the warrants is being amortized to interest expense using the straight-line method over the term of the related loans.

Perceptive

In September 2016, the Company entered into a credit agreement with Perceptive under which it granted 566,500 warrants to purchase ordinary shares. The Company classified the fair value of these warrants as liabilities on the balance sheet due to the existence of certain variable settlement provision that caused them to not be indexed to the Company’s own shares. The value of the Perceptive warrants was estimated using a Monte-Carlo valuation model and at issuance, the Company initially recorded the $1.5 million fair value of the warrants as a debt discount against the related loan balance in its consolidated balance sheets.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

The Company used the Black-Scholes valuation model to determine the fair value of the CPH and Rockport warrants which approximates a Lattice valuation model, which uses assumptions regarding the term, volatility and risk free rate. The term was based on the remaining contractual term on the measurement date. The risk free rate was based on a U.S. Treasury bill with a term equal to the remaining contractual term. The volatility was based on a peer index of comparable companies with the term set to the remaining contractual term on the measurement date. The expected dividend assumption is based on the Company’s expectation that it will not declare dividends for the foreseeable future.

As of December 31, 2016 , the 726,074 warrants to purchase ordinary shares were outstanding and exercisable:

Warrant Holder

Issue Date

In Connection With

Warrant to
Purchase

Exercise
Price

Expiration Date

Rockport

8/28/2015

Loan agreement

Ordinary

106,383

2.82

8/28/2022

Rockport

3/31/2016

Loan agreement

Ordinary

53,191

2.82

3/31/2023

Perceptive

9/30/2016

Loan agreement

Ordinary

566,500

variable

9/30/2021

The fair value of the ordinary share warrants was estimated using the following assumptions:




	On Issuance Date	December 31, 2016
Volatility	55%	60% - 70%
Risk-free interest rate	1.92% - 2.19%	0.66% - 2.13%
Remaining contractual term (in years)	7.0 - 10.0	5.7 - 6.3
Dividend yield	0%	0%

Also in August 2017, the obligations due under the Perceptive credit agreement were fully repaid. The Company repurchased 358,783 warrants for $4.7 million of which $2.3 million is still outstanding as of December 31, 2017. The outstanding amount is due to be paid August 1, 2019 and is included in “Other liabilities, long-term”.

As of December 31, 2017 , the 145,000 warrants to purchase ordinary shares were outstanding and exercisable:

Warrant Holder

Issue Date

In Connection With

Warrant to
Purchase

Exercise
Price

Expiration Date

Rockport

3/3/2017

Loan agreement

Ordinary

145,000

3.80

8/28/2022

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

Instruments Of Certain Nonpublic Entities And Certain Mandatorily Redeemable Noncontrolling Interests With A Scope Exception. As a result, certain warrants that were previously classified as a liability due to an existence of down round features became qualified to be classified as equity. The adoption of this standard resulted in $1.0 million reclassification of warrant liability into additional paid in capital as of July 1, 2017.

10. Share-Based Compensation

In December 2015, the Board of Directors approved and adopted the 2015 Equity Incentive Plan, or 2015 Plan. Under the 2015 Plan, the Company may grant share options, equity appreciation rights, and restricted shares and restricted share units. Pursuant to the 2015 Plan, the Company has granted restricted stock awards, or RSAs, and stock options to Board of Directors, employees and consultants.

The 2015 Plan, as amended, reserves 2,250,000 Class A shares for issuance. If an award granted under the 2015 Plan expires, terminates, is unexercised, or is forfeited, or if any shares are surrendered in connection with an incentive award, the shares subject to such award and the surrendered shares will become available for further awards under the 2015 Plan.

At December 31, the Company recorded the following share-based compensation expense for stock options and restricted stock awards:




	2016		2017
	(in thousands)
General and administrative	$	1,783	$	1,221
Research and development	1,342		2,082
Total	$	3,125	$	3,303

Stock Options




	Number of Options Outstanding		Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Balances at January 1, 2016	—		$	—
Granted (weighted-average fair value of $1.83 per share)	837,587		4.11
Forfeited/canceled	(44,136	)	4.11
Balances at December 31, 2016	793,451		$	4.11	9.7	$	3,309
Granted (weighted-average fair value of $5.18 per share)	189,982		9.81
Forfeited/canceled	(119,501	)	4.11
Balances at December 31, 2017	863,932		$	5.36	7.6	$	4,199

As of December 31, 2017, 425,048 options were vested and exercisable with weighted-average exercise price of $4.19 per share and a total aggregate intrinsic value of $2.5 million.

There have been no exercises of stock options during the years ended December 31, 2016 and 2017. Upon the exercise of stock options, the Company issues new ordinary shares from its authorized shares.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

At December 31, 2017, unrecognized compensation expense was $0.3 million related to stock options granted to employees and directors and $1.6 million related to stock options granted to consultants. The weighted-average period over which such compensation expense will be recognized is 2.9 years.

Stock Options Granted to Employees

Share-based compensation expense for employees is based on the grant date fair value. The Company recognizes compensation expense for all share-based awards on a straight-line basis over the requisite service period of the awards, which is generally the vesting term of four years. During the years ended December 31, 2016 and 2017, the Company recognized $0.3 million and $0.1 million , respectively, of stock-based compensation expense for stock options granted to employees.

The Company uses the Black-Scholes option valuation model to value options granted to employees and consultants, which requires the use of highly subjective assumptions to determine the fair value of share-based awards. The assumptions used in the Company’s option-pricing model represent management’s best estimates. These estimates are complex, involve a number of variables, uncertainties and assumptions and the application of management’s judgment. If factors change and different assumptions are used, the Company’s share-based compensation expense could be materially different in the future. The assumptions and estimates that the Company uses in the Black-Scholes model are as follows:

▪

Fair Value of Common Shares. As the ordinary shares are not publicly traded, the Company must estimate their fair value. The fair value of ordinary shares was determined on a periodic basis by the Company’s Board of Directors, with the assistance of an independent third-party valuation firm. The Board of Directors intended all options granted to be exercisable at a price per share not less than the estimated per share fair value of the stock underlying those options on the date of grant.


▪	Risk-Free Interest Rate. The Company bases the risk-free interest rate used in the Black-Scholes valuation model on the implied yield available on U.S. Treasury zero-coupon issues with a term equivalent to that of the term of the options for each option group on the measurement date.

▪

Term. For employee stock options, the expected term represents the period that the Company’s share-based awards are expected to be outstanding. Because of the limitations on the sale or transfer of the Company’s stock as a privately held company, the Company does not believe its historical exercise pattern is indicative of the pattern it will experience as a publicly traded company. The Company has consequently used the Staff Accounting Bulletin 110, or SAB 110, simplified method to calculate the expected term of employee stock options, which is the average of the contractual term and vesting period. The Company plans to continue to use the SAB 110 simplified method until it has sufficient trading history as a publicly traded company. For consultant stock options, the term used is equal to the remaining contractual term on the measurement date.

▪

Volatility. The Company determines the price volatility based on the historical volatilities of industry peers as it has no trading history for its stock. Industry peers consist of several public companies in the medical device industry with comparable characteristics, including revenue growth, operating model and working capital requirements. The Company intends to continue to consistently apply this process using the same or a similar peer group of public companies until a sufficient amount of historical information regarding the volatility of its own stock becomes available, or unless circumstances change such that the identified peer companies are no longer similar, in which case other suitable peer companies whose common stock prices are publicly available would be utilized in the calculation. The volatility is calculated based on the term on the measurement date.


▪	Dividend Yield. The expected dividend assumption is based on the Company’s current expectations about its anticipated dividend policy. The Company has no expectation that it will declare dividends on its ordinary shares, and therefore has used an expected dividend yield of zero.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

The fair value of stock options granted to employees during 2016 was estimated using the following assumptions:




		December 31, 2016
Volatility		39%
Risk-free interest rate		1.3% - 1.4%
Term (in years)		5.4 - 6.1
Dividend yield		0%

The Company did not grant any stock options to employees during 2017.

Stock Options Granted to Non-Employees

Stock-based compensation expense related to stock options granted to nonemployees is recognized as the stock options are earned using an accelerated attribution method. The Company believes that the estimated fair value of the stock options is more readily measurable than the fair value of the services rendered. For the years ended December 31, 2016 and 2017, the Company recognized expense of $0.6 million and $1.3 million for stock options granted to consultants.

The fair value of stock options granted to consultants was estimated using the following assumptions:




	December 31, 2016	December 31, 2017
Volatility	43%	59%
Risk-free interest rate	1.6% - 2.4%	2.4%
Term (in years)	9.7 - 10	10
Dividend yield	0%	0%

Restricted Stock Awards

Each vested RSA entitles the holder to be issued one share of Class A ordinary stock. Restricted stock awards vest according to a vesting schedule determined by the Compensation Committee of the Company’s Board of Directors, generally over a one to four year period.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

The following table represents RSA activity for fiscal 2016 and 2017:




	Restricted Stock Awards		Weighted- Average Grant Date Fair Value
Outstanding unvested at January 1, 2016	—		$	—
Granted	968,050		4.11
Vested	(513,896	)	4.11
Forfeited/canceled	—		—
Outstanding unvested at December 31, 2016	454,154		$	4.11
Granted	525,230		9.56
Vested	(197,978	)	5.89
Forfeited/canceled	(196,350	)	8.52
Outstanding unvested at December 31, 2017	585,056		$	8.57

The fair value of RSAs is the grant date market value of the Class A ordinary stock. The Company recognizes share-based compensation expense related to RSAs using a straight-line method over the vesting term of the awards. The fair value of RSAs that vested during fiscal 2016 and 2017 was $2.1 million and $1.9 million , respectively, which was calculated based on the market value of the Company’s ordinary stock on the applicable date of vesting.

As of December 31, 2017, we had unrecognized share-based compensation cost of approximately $5.0 million associated with unvested restricted stock awards. This cost is expected to be recognized over a weighted-average period of approximately 2.6 years.

11. Business Combinations

Brazil

In January 2016, the Company acquired all of the outstanding and issued shares of RD&S Produtos Para Saude Ltda-EPP, a Brazilian private company in exchange for $0.2 million in cash. The purchase enabled the Company to begin distribution of its products in Brazil. In connection with the purchase, the Company has recorded $0.1 million as a regulatory application intangible asset, and $0.1 million as goodwill.

European Distribution Center Motiva BVBA

In March 2016, the Company acquired all of the outstanding and issued shares of EDC Motiva BVBA in exchange for 18,000 Class A ordinary shares. Prior to the exchange, EDC Motiva BVBA had provided warehouse and logistics services to the Company under distribution agreements entered into in 2012. Along with the shares, the Company also granted a put right to the former shareholder to sell the 18,000 shares issued in the acquisition back to the Company between July 1 and July 15, 2017 for $0.25 million in the case that an initial public offering has not been consummated prior to July 1, 2017. This liability-classified put option has been determined to be a freestanding financial instrument because it is freely transferable and separately exercisable. The Company recorded an initial fair value of $0.1 million for the put option as a part of the purchase price consideration. The Company will continue to adjust the liability for changes in fair value until the earlier of the expiration of the option or its exercise. The Company records any change in fair value in the consolidated statements of operations as other income or expense. As of December 31, 2016, the Company had recorded a put option liability of $36,000 on its consolidated balance sheets for this obligation.

The Company also entered into an arrangement with the former shareholder to provide services for a period of one year following the acquisition, which was recorded as a part of the purchase price consideration as it was fully non-cancellable and non-refundable on the date of acquisition. The Company also issued a credit to the distributor in the

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

Netherlands that gave up their distribution rights in connection with the acquisition, which was included in the purchase price consideration.

The purchase price and allocation of purchase price were as follows:




Purchase Price:	(in thousands)
Fair market value of Class A ordinary shares on agreement date	$	99
Fair market value of put option granted	74
Nonrefundable consulting contract	39
Distributor credit	27
Total Purchase Price	$	239




Allocation of Purchase Price:	(in thousands)
Assets acquired:
Cash	$	159
Other assets	48
Liabilities assumed	(81		)
Net tangible assets acquired	126
Goodwill	113
Total assets acquired	$	239

France

In September 2016, the Company acquired all of the outstanding and issued shares of Motiva Implants France, a French private company in exchange for $0.1 million in cash. Total assets acquired and liabilities assumed was $0.4 million and $0.3 million, respectively. The purchase enabled the Company to begin direct distribution of its products in France. In connection with the purchase, the Company has recorded $0.2 million as a regulatory application intangible asset and $28,000 as goodwill.

Sweden

On November 17, 2017, the Company and Femiline AB and Johan Anderson, or the Seller, entered into an agreement to purchase certain assets from the Seller. The assets purchased included all existing inventory previously sold by the Company to the Seller, all customer relationships and a covenant not to compete. The aggregate purchase price for the assets purchased was 100,000 Class A Ordinary shares of the Company, contingently issuable upon achievement of specific milestones. Based on the valuation of the Company’s shares performed by a valuation specialist, the contingently issuable shares had an aggregate value of $1.0 million . The book value of the inventory at the time of the acquisition was approximately $0.7 million, which was revalued on the transaction date to be the estimated selling price less the cost to sell, which increased the fair value of the inventory to approximately $1.5 million.

Concurrently, the Company entered into a Separation Agreement with Novaform Ltd, or Novaform, and Pantelis Ioannou. In April 2015, Novaform had become a distributor for Establishment Labs S.A., wholly-owned subsidiary of the Company and subsequently sublicensed its distribution rights to Femiline AB. Under the Separation Agreement, Novaform agreed to relinquish the distribution rights back to the Company for $1.0 million in cash and 35,714 Class A ordinary shares.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

Based on the valuation of the Company’s shares performed by a valuation specialist, the fair value of the shares issued was $0.3 million.

This transaction will enable the Company to restructure its existing distribution network in Sweden, Denmark and Norway and initiate direct sales to customers in the region.

The purchase price and allocation of purchase price were as follows:




Purchase Price:	(in thousands)
Cash consideration	$	1,000
Fair market value of Class A ordinary shares issued	344
Contingent consideration	964
Cash paid for inventory	704
Total purchase price	$	3,012




Allocation of Purchase Price:	(in thousands)
Inventory	$	1,498
Customer relationships	1,280
Covenant not to compete	24
Goodwill	210
Total purchase price allocated	$	3,012

As of December 31, 2017 , the consideration of $1.0 million to Novaform and $0.7 million to Femiline AB has not been paid and is included in “Accounts payable”.

Only the goodwill related to the 2017 acquisition is deductible for tax purposes.

12. Income Taxes

For the years ended December 31, 2016 and 2017, loss before income tax provision consisted of the following:




	2016			2017
	(in thousands)
Costa Rica Operations	$	(10,698	)	$	(6,887	)
Non-Costa Rica Operations	(11,327		)	(27,905		)
	$	(22,025	)	$	(34,792	)

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

As of December 31, income tax provision consisted of the following:




	2016		2017
	(in thousands)
Current
Costa Rica	$	—	$	—
Non-Costa Rica	134		105
Total Current	134		105
Deferred
Costa Rica	—		—
Non-Costa Rica	—		—
Total deferred	—		—
Total provision	$	134	$	105

The items accounting for the difference between income taxes computed at the Costa Rica statutory income tax rate and the income tax provision consisted of the following at December 31:




	2016					2017
	(in thousands)
Tax benefit at Costa Rica statutory rate	$	(6,607	)	30	%	$	(10,438	)	30	%
Foreign tax rate differential	2,465			(11	)	5,665			(15	)
Tax rate changes	—			—		562			(2	)
Return to provision adjustment	—			—		679			(1	)
Tax credits	—			—		(26		)	—
Change in valuation allowance	1,614			(7	)	1,768			(4	)
Net operating loss expiration	94			—		—			—
Tax holiday benefit	2,568			(12	)	1,653			(8	)
Other	—			—		242			—
	$	134		—	%	$	105		—	%

The Company's tax holiday benefit was related to the Company’s subsidiary in Costa Rica which enjoyed a 6% tax rate for the years ended December 31, 2016 and 2017 .

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

As of December 31, the components of the Company's deferred tax assets and liabilities are as follows:




	2016			2017
	(in thousands)
Accruals and reserves	$	—		$	91
Deferred revenue	54			33
Intangibles	114			69
Stock compensation	7			5
Net operating loss	1,635			3,384
R&D credits	—			28
Other	10			6
Valuation allowance	(1,848		)	(3,616		)
Total net deferred tax liabilities	$	(28	)	$	—

Effective December 1, 2017, the Company adopted, on a prospective basis, ASU 2015-17, Balance Sheet Classification of Deferred Taxes , which simplifies the presentation of deferred income taxes by requiring deferred tax assets and liabilities be classified as non-current on the balance sheet. The adoption of ASU 2015-17 did not have a material impact on the consolidated financial statements.

As of December 31, 2016 and 2017 , the Company assessed that it is more-likely-than-not that it will not realize its deferred tax assets based on the absence of sufficient positive objective evidence that it would generate sufficient taxable income in its Costa Rica and U.S. tax jurisdictions to realize the deferred tax assets. The Company intends to continue maintaining a full valuation allowance on its deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances.

As of December 31, 2017 , the Company has Costa Rica net operating loss carryforwards of approximately $3.2 million available to reduce any future taxable income. If not utilized, the net operating loss carryforwards will expire beginning in 2020. Costa Rica net operating losses can be carried forward three years. As of December 31, 2017, the Company had Costa Rica, U.S. and California tax credit carryforwards of approximately $0.1M in total. These credits begin to expire in 2022. However, the California R&D credit can be carried forward indefinitely. As of December 31, 2017 , the Company had U.S. federal, California, Brazil and France net operating losses of approximately $4.4 million, $4.4 million, $5.5 million and $0.2 million, respectively. The U.S. federal and California net operating losses will expire December 31, 2035 . Brazil and France net operating losses can be carried forward indefinitely. Federal and California laws impose restrictions on the utilization of net operating loss carryforwards and R&D credit carryforwards in the event of a change in ownership of the Company, which constitutes an “ownership change” as defined by U.S. Internal Revenue Code Sections 382 and 383. The Company has not performed a detailed analysis to determine whether an ownership change under Section 382 and 383 of the Code has previously occurred. As a result, the Company’s ability to utilize existing carryforwards could be substantially restricted.

The Company is incorporated as an international business company with limited liability under International Business Companies Act, 1984 of the British Virgin Islands. As of December 31, 2017 , the Company also conducted business in Costa Rica, Belgium, France, Brazil and the United States and is subject to tax in these jurisdictions. As a result, the Company's worldwide income will be subject to the tax rates in which its income is generated and as such its effective tax rate may fluctuate based on the geographic distribution of its earned income or losses and the applicable tax laws in which those earnings or losses were generated.

Management’s intention is to indefinitely reinvest any undistributed earnings from its subsidiaries. Accordingly, no provision for withholding taxes has been provided nor is it practical to determine the amount of this liability. Upon

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

distribution of those earnings in the form of dividends or otherwise, the Company will be subject to potential withholding taxes in the above-mentioned jurisdictions.

Accounting for Uncertainty in Income Taxes

The Company has adopted ASC 740-10 Accounting for Uncertainty in Income Taxes (formerly FIN 48). ASC 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in the Company's income tax return, and provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. For the years ended December 31, 2016 and 2017 the Company has no material uncertain tax positions. The Company does not expect any significant increases or decreases to its unrecognized tax benefits within the next 12 months. The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.

As of December 31, 2017 , the Company is subject to taxation in Costa Rica, Belgium, France, Brazil and the United States and the Company’s fiscal tax years 2012 through 2017 are subject to examination by the tax authorities.

2017 Tax Reform

On December 22, 2017, the Tax Cuts and Jobs Act, or Tax Reform, was signed into legislation. The Tax Reform makes significant changes to the U.S. corporate income tax law including, but not limited to, (1) reducing the U.S. federal corporate tax rate from 35% to 21% and (2) requiring a one-time mandatory transition tax on previously deferred foreign earnings of U.S. subsidiaries. Under ASC 740, Income Taxes, the effects of changes in tax rates and laws are recognized in the period in which the new legislation is enacted. In the case of U.S. federal income taxes, the enactment date is the date the bill becomes law. With respect to this legislation, we expect no financial statement impact due to the Company's valuation allowance. The Company performed a re-measurement of deferred tax assets and liabilities as a result of the decrease in the corporate Federal income tax rate from 35% to 21% of $0.6 million with a corresponding decrease to its U.S. valuation allowance of $0.6 million. In addition to the reduction of U.S. federal corporate tax rate, the Company has also considered the impact of the foreign transition tax for which it has estimated that it would not need to accrue any tax provision.

In December 2017, the Securities and Exchange Commission staff issued Staff Accounting Bulletin No.118, or SAB 118, to provide guidance on the application of the Tax Reform when a company does not have necessary information available, prepared, or analyzed in reasonable detail to reflect the effects of the Tax Reform. SAB 118 provides guidance for companies under the three scenarios (1) measurement of certain income tax effects is complete, (2) measurement of certain income tax effect can be reasonably estimated, and (3) measurement of certain income tax effects cannot be reasonably estimated. Companies are to complete the accounting under ASC 740 in regards to the Tax Reform within a measurement period that does not extend one year from the date of enactment. In accordance with SAB 118, companies must reflect the tax effects of the Tax Reform for which the accounting under 740 is complete. If certain income tax effect can be reasonably estimated, then the companies must report provisional amounts in the reporting period in which the companies can determine the reasonable estimate during the measurement period. In the case that certain income tax effects cannot be reasonably estimated, companies do not have to report effects of the Tax Reform. However, they should continue to apply ASC 740 based on the rules before the enactment of the Tax Reform and report any income tax effects in the first reporting period in which reasonable estimates become available.

The final impact of the Tax Reform may differ from the above estimate, possibly materially, due to, among other things, changes in interpretations of the tax guidance, any legislative action to address questions that arise because of the Tax Reform, any changes in accounting standards for income taxes or related interpretations in response to the Tax Reform, or any updates or changes to estimates the company has utilized to calculate the transition impact, including impact from changes to current year earnings estimates and foreign exchange rates of foreign subsidiaries. In accordance with SAB 118, the Company is allowed a measurement period of up to one year after the enactment date of the Tax Act to finalize the recording of the related tax impacts. We currently anticipate finalizing and recording any resulting adjustments by year ending December 31, 2018 if necessary.

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

13. Net Income (Loss) Per Share

The following table summarizes the computation of basic and diluted net loss per share for the years ended December 31:




	2016			2017
	(in thousands, except share and per share data)
Numerator:
Net loss	$	(22,159	)	$	(34,897	)
Denominator:
Weighted average ordinary shares	6,482,249			10,230,586
Net loss per share, basic and diluted	$	(3.42	)	$	(3.41	)

Basic net loss per share is computed by dividing the net loss by the weighted-average number of ordinary shares outstanding for the period. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of ordinary shares and dilutive ordinary share equivalents outstanding for the period, determined using the treasury-share method and the as-if converted method, for convertible securities, if inclusion of these is dilutive .

Because the Company has reported a net loss in all periods presented, diluted net loss per ordinary share is the same as basic net loss per ordinary share for those periods because including the dilutive securities would be anti-dilutive.

The following potentially dilutive securities outstanding at the end of the periods presented have been excluded from the computation of diluted shares outstanding at December 31:




	2016	2017
Shares issuable on conversion of related party convertible notes payable	5,869,417	—
Ordinary share options	793,451	863,932
Shares to be issued upon vesting of RSAs	454,154	585,056
Warrants to purchase ordinary shares	726,074	145,000
Total	7,843,096	1,593,988

14. Related Party Transactions

In August 2015, the Company entered into a Note and Warrant purchase agreement with CPH (see Note 6) . On August 24, 2017, CPH elected to convert the principal and the accrued interest outstanding under the Notes into 5,869,417 shares of the Company’s Class B ordinary shares. There is no outstanding balance under the Note and Warrant purchase agreement as of December 31, 2017. CPH owns approximately 50.9% of the ordinary shares of the Company as of December 31, 2017 .

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ESTABLISHMENT LABS HOLDINGS INC.

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2016 and 2017

In August 2017, the Company entered into a credit agreement with Madryn and a syndicate of lenders to borrow up to $55.0 million (see Note 6). As of December 31, 2017, Madryn owns approximately 5.7% of the ordinary shares of the Company.

In August 2015, the Company entered into a Note Agreement with the former Class Z preferred shareholders to exchange the outstanding shares for notes payable in the aggregate principal amount of $4.3 million (see Note 6). The Class Z preferred shareholders are primarily the original founders of the Company.

During the years ended December 31, 2016 and 2017 , the Company recorded revenue of $0.6 million and $0.6 million , respectively, for product sales to Herramientas Medicas, S.A., a distribution company owned by a family member of the Chief Executive Officer of the Company. Accounts receivable owed to the Company from this distribution company amounted to approximately $0.3 million and $0.1 million as of December 31, 2016 and 2017 , respectively.

In August 2016, the Company entered into note agreements to borrow $1.45 million for a period of 30 days from existing investors and executive officers of the Company. The interest rate on the notes is 10% per annum. These notes were repaid in 2016. In December 2016, the Company entered into a note agreement to borrow $0.2 million from executive officer of the Company. This note was repaid in 2017.

In September 2016, the Company acquired all of the outstanding and issued shares of Motiva Implants France, a French private company in exchange for $0.1 million in cash and the assumption of all assets and liabilities (see Note 11). The distribution company was previously owned by Olivier Tourniaire, our Vice President of Sales, Asia Pacific, Middle East and Africa, and a current shareholder of the Company.

In September 2016, the Company entered into a share repurchase agreement with Global Silicone SRL for the repurchase of 813,140 ordinary shares of the Company owned by Global Silicone SRL in exchange for $3.7 million. In October 2016, the Company paid $2.0 million to Global Silicone SRL to repurchase 440,040 shares and the remaining $1.7 million was paid in April 2017. In July 2017, the Company paid $2.8 million to repurchase additional 406,570 Class A ordinary shares from Global Silicone SRL.

In May 2016, the Company entered into a scientific board advisory agreement with Dr. Manuel Enrique Chacon Quiros pursuant to which Dr. Chacon Quiros joined the Company’s Scientific Advisory Board, provides general scientific advice, and serves as a clinical investigator, among other services. In exchange for these services, Dr. Chacon Quiros was granted options to purchase 20,580 shares, vesting over four years in equal annual installments, provided that he continues to provide these services at such times. In September 2016, the Company entered into a separate agreement whereby Dr. Chacon Quiros will maintain his clinic in Costa Rica as a MotivaImagine Excellence Center and will host and train physicians in the use of the Company products in relevant procedures, among other services, in exchange for cash reimbursement of up to $4,500 per day that such services are rendered. Dr. Chacon Quiros is the brother of our Chief Executive Officer, Juan Jose Chacon Quiros. During the years ended December 31, 2016 and 2017, the Company paid Dr. Chacon Quiros $32,000 and $120,000 , respectively, for services rendered.

During the year ended December 31, 2017, the Company recorded revenue of $0.3 million for product sales to Motiva Netherlands BV, a distribution company owned by Erick Vogelanzeng, our Vice President of Sales, Europe . Accounts payable due to this distribution company amounted to zero as of December 31, 2017 .

15. Employee Benefits

Short-term employee benefits, including vacation (paid absences) and year-end bonuses (also known as 13 ^th month salary), are current liabilities included in accrued liabilities on the consolidated balance sheet and are calculated at the non-discounted amount that the Company expects to pay as a result of uncharged employee salaries or retentions.

Regarding employee termination benefits, Costa Rica labor laws establish the payment of benefits in case of death, retirement or termination without cause. This compensation is calculated according to time served in the company and the corresponding salary in the last six months of employment, and is equal to between 19.5 and 22 days salary for each year served, up to a maximum of 8 years.

Company policy recognizes termination benefits as expenses of the period during which the termination occurs, when the legal obligation is assumed due to the aforementioned events.

None of the Company’s employees are represented by a labor union. The Company has not experienced any work

F-49

stoppages, and it considers employee relations to be good.

16. Subsequent Events

The Company has reviewed and evaluated subsequent events that occurred through May 10, 2018 , the date the consolidated financial statements were issued.

In January 2018, the Company increased the number of Class A shares reserved for 2015 Equity Incentive Plan by 400,000 shares to a new total of 2,650,000 shares.

In multiple closings between February and May 2018, the Company issued an aggregate of $2.9 million of Class G ordinary shares at a purchase price of $16.00 per share to several investors . In connection with the issuance of these shares, the Company amended and restated its memorandum of association to increase the authorized shares of the Company to a total of 108,822,799 shares and to authorize 1,250,000 Class G shares.

Between January 2018 and May 10, 2018 , the Board of Directors approved grants of 397,861 shares of stock options.

In January 2018, management made an assessment that the Company would likely default on the Madryn Credit Agreement due to its investment in our Brazilian subsidiary approaching the $5.0 million limit. The Company informed Madryn and the syndicate of lenders, or the Lenders, of the potential technical default event and started the process to obtain a forbearance agreement. The Company initially defaulted on the Madryn Credit Agreement on January 19, 2018 when it failed to put a Qualifying Control Agreement in place for certain bank deposit accounts and subsequently on February 28, 2018 when its investment in its Brazilian subsidiary exceeded the allowable $5.0 million threshold permitted under the Madryn Credit Agreement. As a result, on March 23, 2018 and subsequently on April 30, 2018, the Company entered into a forbearance agreement with the Lenders, where the Lenders agreed to forebear from exercising certain rights and remedies through May 18, 2018 arising from certain disclosure and other technical defaults under the Madryn Credit Agreement, including those mentioned above with respect to our Brazilian subsidiary. In accordance with certain cure rights under the Madryn Credit Agreement and the forbearance agreement terms, the Company will use its best efforts to raise no less than $20.0 million of cash proceeds from equity issuances. Furthermore, the forbearance agreement permits the limit of the amount of investment in the Brazilian subsidiary not to exceed an additional $5.0 million, and maintain the liquidity in accounts for which Madryn received a qualifying control agreement of no less than $2.0 million, while the Company provides periodic reports on all investments in the Brazilian subsidiary. The forbearance agreement also forbears the lenders from exercising certain rights and remedies in the event of our failure to provide the report and opinion of an independent certified public accountant free from any “going concern” qualifications for the fiscal year ended December 31, 2017. Accordingly, the Company recorded the Madryn debt as a current liability on the consolidated balance sheet as of December 31, 2017. Management is working with the Lenders to amend the Madryn Credit Agreement to remove the restrictive covenants that resulted in the technical defaults which would allow the Company to reclassify the arrangement as long-term.

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Table of Contents

ESTABLISHMENT LABS HOLDINGS INC.

Index to Condensed Consolidated Financial Statements (Unaudited)

For the Three Months Ended March 31, 2017 and 2018




	PAGE
Interim Condensed Consolidated Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets	F-52
Condensed Consolidated Statements of Operations	F-53
Condensed Consolidated Statements of Comprehensive Loss	F-54
Condensed Consolidated Statement of Stockholders’ Deficit	F-55
Condensed Consolidated Statements of Cash Flows	F-56
Notes to Condensed Consolidated Financial Statements	F-57

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ESTABLISHMENT LABS HOLDINGS INC.

Condensed Consolidated Balance Sheets

(Unaudited) (In thousands, except share data)




	December 31, 2017			March 31, 2018
Assets
Current assets:
Cash	$	10,864		$	6,613
Accounts receivable, net of allowance for doubtful accounts of $1,512 and $1,547	13,108			18,440
Inventory	13,173			12,652
Prepaid expenses and other current assets	2,237			3,871
Total current assets	39,382			41,576
Long-term assets:
Property and equipment, net of accumulated depreciation of $3,179 and $3,663	13,500			13,363
Goodwill	465			465
Intangible assets, net of accumulated amortization of $573 and $726	3,401			3,270
Restricted cash	75			75
Other non-current assets	272			267
Total assets	$	57,095		$	59,016
Liabilities and shareholders’ deficit
Current liabilities:
Accounts payable	$	9,131		$	10,566
Accrued liabilities	2,326			3,552
Notes payable related party, including accrued interest	4,921			4,994
Note payable, Madryn, net of debt discount and issuance costs	19,167			—
Madryn put option	20,302			—
Madryn call option	360			—
Other liabilities, short term	1,228			1,786
Total current liabilities	57,435			20,898
Long-term liabilities:
Note payable, Madryn, net of debt discount and issuance costs	—			19,908
Madryn put option	—			21,744
Madryn call option	—			223
Other liabilities, long term	4,673			5,003
Total liabilities	62,108			67,776
Commitments and contingencies (Note 7)
Shareholders’ equity (deficit):
Ordinary shares - $1.00 par value (class A and B), 21,206,630 shares authorized at December 31, 2017 and March 31, 2018; 13,427,536 and 13,575,809 shares issued at December 31, 2017 and March 31, 2018, respectively; 12,206,326 and 12,354,599 shares outstanding at December 31, 2017 and March 31, 2018, respectively	13,427			13,576
Ordinary shares - no par value (class C, D, E, F and G), 2,316,169 and 3,566,169 shares authorized at December 31, 2017 and March 31, 2018, respectively; 2,316,169 and 2,416,784 shares issued and outstanding at December 31, 2017 and March 31, 2018, respectively	27,840			29,449
Common shares - $1.00 par value, 84,050,000 shares authorized at December 31, 2017 and March 31, 2018; zero shares issued and outstanding at December 31, 2017 and March 31, 2018	—			—
Additional paid-in-capital	27,986			29,017
Treasury shares, at cost, 1,221,210 shares held at December 31, 2017 and March 31, 2018	(6,465		)	(6,465		)
Accumulated deficit	(67,877		)	(74,407		)
Accumulated other comprehensive income	76			70
Total shareholders’ equity (deficit)	(5,013		)	(8,760		)
Total liabilities and shareholders’ equity (deficit)	$	57,095		$	59,016

See notes to condensed consolidated financial statements.

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ESTABLISHMENT LABS HOLDINGS INC.

Condensed Consolidated Statements of Operations

(Unaudited) (In thousands)




	Three Months Ended March 31,
	2017			2018
Revenue	$	6,919		$	14,816
Cost of revenue	3,509			6,901
Gross profit	3,410			7,915
Operating expenses:
Sales, general and administrative	5,849			8,648
Research and development	1,503			2,147
Total operating expenses	7,352			10,795
Loss from operations	(3,942		)	(2,880		)
Interest income	2			4
Interest expense	(927		)	(2,171		)
Change in fair value of derivative instruments	(286		)	(1,305		)
Change in fair value of contingent consideration	—			(363		)
Other income (expense), net	159			195
Loss before income taxes	(4,994		)	(6,520		)
Provision for income taxes	(5		)	(10		)
Net loss	$	(4,999	)	$	(6,530	)

Basic and diluted net loss per share attributable to ordinary shareholders	$	(0.75	)	$	(0.45	)
Weighted average outstanding ordinary shares used for net loss per share attributable to ordinary shareholders	6,633,635			14,662,092

See notes to condensed consolidated financial statements.

F-53

ESTABLISHMENT LABS HOLDINGS INC.

Condensed Consolidated Statements of Comprehensive Loss

(Unaudited) (In thousands)




	Three Months Ended March 31,
	2017			2018
Net loss	$	(4,999	)	$	(6,530	)
Other comprehensive income:
Foreign currency translation loss	(8		)	(6		)
Other comprehensive loss	(8		)	(6		)
Comprehensive loss	$	(5,007	)	$	(6,536	)

See notes to condensed consolidated financial statements.

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ESTABLISHMENT LABS HOLDINGS INC.

Condensed Consolidated Statement of Shareholders’ Deficit

(Unaudited) (In thousands, except share data)




	Ordinary Shares			Treasury Shares					Additional Paid-In Capital		Accumulated Deficit			Accumulated Other Comprehensive Income			Total
	Shares	Amount		Shares		Amount			Additional Paid-In Capital		Accumulated Deficit			Accumulated Other Comprehensive Income			Total
Balance at January 1, 2018	15,743,705	$	41,267	(1,221,210	)	$	(6,465	)	$	27,986	$	(67,877	)	$	76		$	(5,013	)
Issuance of shares	100,615	1,610		—		—								—			1,610
Stock option exercises	106,248	106							330								436
Stock-based compensation	42,025	42		—		—			701					—			743
Foreign currency translation loss	—	—		—		—								(6		)	(6		)
Net loss	—	—		—		—					(6,530		)	—			(6,530		)
Balances at March 31, 2018	15,992,593	$	43,025	(1,221,210	)	$	(6,465	)	$	29,017	$	(74,407	)	$	70		$	(8,760	)

See notes to condensed consolidated financial statements.

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ESTABLISHMENT LABS HOLDINGS INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited) (In thousands)




	Three Months Ended March 31,
	2017			2018
Cash flows from operating activities:
Net loss	$	(4,999	)	$	(6,530	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	252			637
Provision for doubtful accounts	256			35
Stock-based compensation	1,122			743
Change in fair value of derivative instruments	286			1,305
Change in fair value of contingent consideration	—			363
Non-cash interest expense and amortization of debt discount	582			814
Changes in operating assets and liabilities:
Accounts receivable	524			(5,136		)
Inventory	(1,932		)	698
Prepaid expenses and other current assets	(1,031		)	(1,647		)
Other assets	(754		)	5
Accounts payable	(1,893		)	932
Accrued liabilities	868			1,229
Other liabilities	115			621
Net cash used in operating activities	(6,604		)	(5,931		)
Cash flows from investing activities:
Purchases of property and equipment	(826		)	(392		)
Cost incurred for intangible assets	—			(22		)
Increase in restricted cash	96			—
Net cash used in investing activities	(730		)	(414		)
Cash flows from financing activities:
Borrowings on short-term notes payable	1,000			—
Repayments on short term notes payable	(200		)	—
Payments of deferred offering costs	(290		)	—
Repayments on capital leases	(9		)	(64		)
Proceeds from issuance of ordinary shares	14,723			1,610
Proceeds from stock option exercises	—			436
Net cash provided by financing activities	15,224			1,982
Effect of exchange rate changes on cash	(15		)	112
Net increase in cash	7,875			(4,251		)
Cash at beginning of period	479			10,864
Cash at end of period	$	8,354		$	6,613

Supplemental disclosures:
Cash paid for interest	$	450		$	1,283
Cash paid for income taxes	$	37		$	—

Supplemental disclosures of non-cash investing and financing activities:
Unpaid balance for property and equipment	$	791		$	730

See notes to condensed consolidated financial statements.

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1. Formation, Business of the Company and Going Concern

Formation and Business of the Company

The main manufacturing activities are conducted in two manufacturing facilities in Costa Rica. Beginning in 2010, the Company began operating under the Costa Rica free zone regime (Régimen de Zona Franca), which provides for reduced income tax and other tax obligations pursuant to an agreement with the Costa Rican authorities.

The Company’s products are approved for sale in Europe, the Middle East, Latin America, Australia and Asia. The Company sells its products internationally through distributors as well as making direct sales to customers.

The Company is actively working on obtaining regulatory approval to commercialize its products in the United States. The Company received approval of an investigational device exemption, or IDE, from the FDA in March 2018 to initiate the Motiva Implant clinical trial in the United States. Enrollment is anticipated to be completed in early 2019.

Going Concern

As of March 31, 2018 , the Company had cash of $6.6 million . During the three months ended March 31, 2018 , the Company incurred a net loss of $6.5 million and used $5.9 million of cash in operations. At March 31, 2018 , the Company had an accumulated deficit of $74.4 million and currently does not expect to experience positive cash flows from operations in the near future. The Company has financed operations to date primarily through private placements of debt and equity securities. During the three months ended March 31, 2018 , the Company received $2.0 million from the issuance of class G ordinary shares and exercise of stock options. Subsequent to March 31, 2018 , the Company received $14.6 million from the issuance of Class G and G-1 ordinary shares.

On August 24, 2017 the Company entered into a credit agreement, or the Madryn Credit Agreement, with Madryn Health Partners, LP, or Madryn, as administrative agent, and a syndicate of lenders, or the Lenders. The Company initially defaulted on the Madryn Credit Agreement during the first quarter of fiscal 2018. As a result, the Company entered into a forbearance agreement with the Lenders, where the Lenders agreed to forebear from exercising certain rights and remedies through May 18, 2018 and subsequently through July 3, 2018 arising from certain disclosure and other technical defaults. Accordingly, as the forbearance agreement did not cover a period exceeding twelve months after the date of the annual financial statements, the Company recorded the Madryn debt as a current liability on the consolidated balance sheet as of December 31, 2017. Effective June 15, 2018, Madryn Credit Agreement was amended to remove the restrictive covenants that resulted in the technical defaults which allowed the Company to reclassify the arrangement as long-term as of March 31, 2018.

Management expects the Company to continue to incur additional losses in the near and intermediate future because of the Company’s activities. The negative cash flows from operations and lack of financial resources of the Company raise substantial doubt as to the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued. Management plans to finance operations through equity or debt financing

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

arrangements; however, if the Company is unable to raise additional funding to meet its working capital needs, or if funds are only available at terms unfavorable to the Company, the Company may be forced to delay or reduce the scope of its capital investment programs and/or limit or cease its operations. The Company will need to raise substantial additional funding in the near term to sustain operations.

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which assumes the realization of assets and the settlement of liabilities and commitments in the normal course of business. The condensed consolidated financial statements do not reflect any adjustments relating to the recoverability and reclassification of assets and liabilities that might be necessary if the Company is unable to continue as a going concern.

2. Summary of Significant Accounting Policies

There have been no material changes to the Company’s significant accounting policies during the three months ended March 31, 2018 , as compared to the significant accounting policies described in Note 2 of the “Notes to Consolidated Financial Statements” in the Company’s audited consolidated financial statements as of December 31, 2016 and 2017 and for the years then ended. Below are those policies with current period updates:

Basis of Presentation and Consolidation

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, and the applicable rules and regulations of the Securities and Exchange Commission, or SEC, for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. The condensed consolidated balance sheet at December 31, 2017 has been derived from the audited consolidated financial statements at that date, but does not include all disclosures, including notes, required by GAAP for complete financial statements.

The accompanying condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the years ended December 31, 2016 and 2017 included elsewhere here in this filing.

The condensed consolidated financial statements include the Company’s accounts and those of its wholly owned subsidiaries as of March 31, 2018 as follows:




Subsidiary	Incorporation/Acquisition Date
Establishment Labs, S.A. (Costa Rica)	January 18, 2004
Motiva USA, LLC (USA)	February 20, 2014
JAMM Technologies, Inc. (USA)	October 27, 2015
Establishment Labs Produtos par Saude Ltda (Brazil)	January 4, 2016
European Distribution Center Motiva BVBA (Belgium)	March 4, 2016
Motiva Implants France SAS (France)	September 12, 2016
JEN-Vault AG (Switzerland)	November 22, 2016
Motiva Nordica AB (Sweden)	November 2, 2017

All intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Condensed Consolidated Financial Information

The accompanying interim condensed consolidated financial statements as of March 31, 2018 and for the three months ended March 31, 2017 and 2018 , and the related interim information contained within the notes to the condensed consolidated financial statements, are unaudited. The unaudited interim condensed consolidated financial statements have been prepared in accordance with GAAP and on the same basis as the audited consolidated financial statements. In

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

the opinion of management, the accompanying unaudited interim condensed consolidated financial statements contain all adjustments which are necessary to state fairly the Company’s financial position as of March 31, 2018 , and the results of its operations and cash flows for the three months ended March 31, 2017 and 2018 . Such adjustments are of a normal and recurring nature. The results for the three months ended March 31, 2018 are not necessarily indicative of the results to be expected for the full fiscal year 2018, or for any future period.

Segments

Geographic Concentrations

For the three months ended March 31, 2017 and 2018, no individual country exceeded 10% of consolidated revenue, on a ship-to destination basis.

The Company’s long-lived assets located in Costa Rica represented the majority of the total long-lived assets as of December 31, 2017 and March 31, 2018 .

Use of Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Significant accounting estimates and management judgments reflected in the consolidated financial statements include items such as accounts receivable valuation and allowances, inventory valuation and allowances, valuation of acquired intangible assets, valuation of derivatives, estimation of assets’ useful lives and valuation of deferred income tax assets, including tax valuation allowances. Estimates are based on historical experience, where applicable, and other assumptions believed to be reasonable by management. Actual results may differ from those estimates under different assumptions or conditions.

Concentration of Credit Risk and Other Risks and Uncertainties

Financial instruments that potentially subject the Company to a concentration of credit risk consist principally of cash, restricted cash and accounts receivable. The majority of the Company’s cash is held at one financial institution in Costa Rica. The Company has not experienced any losses on its deposits of cash.

All of the Company’s revenue has been derived from sales of its products in international markets, principally Europe, Middle East, Latin America, and Asia. In the international markets in which the Company participates, the Company uses a combination of distributors to sell its products as well as making direct sales to customers. The Company performs ongoing credit evaluations of its distributors and customers, does not require collateral, and maintains allowances for potential credit losses on customer accounts when deemed necessary.

During the three months ended March 31, 2017 and 2018 , no customers accounted for more than 10% of the Company’s revenue. No customers accounted for more than 10% of the Company’s accounts receivable balance as of December 31, 2017 and March 31, 2018. Substantially all of the Company’s revenues are derived from the sale of Motiva Implants.

The Company relies on NuSil Technology, LLC, or NuSil, as the sole supplier of medical-grade silicone used in Motiva Implants as well as other products that are manufactured under contract to other customers. During the three months ended March 31, 2017 and 2018 , the Company had purchases of $2.5 million, or 59.9% of total purchases, and $2.9 million, or 61.1% of total purchases, respectively, from Nusil, and as of December 31, 2017 and March 31, 2018 , had an outstanding balance owed to this vendor of $0.7 million and $0.8 million , respectively.

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Cash

The Company’s cash consists of cash maintained in checking and interest-bearing accounts. The Company accounts for financial instruments with original maturities of three months or less at the date of purchase as cash equivalents. The Company held no cash equivalents as of December 31, 2017 and March 31, 2018 .

Restricted Cash

As of December 31, 2017 and March 31, 2018 , the restricted cash balance represented a certificate of deposit collateralizing payment of charges related to the Company's corporate credit card.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable is stated at invoice value less estimated allowances for returns and doubtful accounts. The Company continually monitors customer payments and maintains an allowance for estimated losses resulting from customers’ inability to make required payments. In evaluating the Company’s ability to collect outstanding receivable balances, the Company considers various factors including the age of the balance, the creditworthiness of the customer, which is assessed based on ongoing credit evaluations and payment history, and the customer’s current financial condition. In cases where there are circumstances that may impair a specific customer’s ability to meet its financial obligations, an allowance is recorded against amounts due, which reduces the net recognized receivable to the amount reasonably believed to be collectible. Historical returns of products have been de minimis and accordingly no allowance for returns was recorded as of December 31, 2017 and March 31, 2018 .

Inventory and Cost of Revenue

Inventory is stated at the lower of cost to purchase or manufacture the inventory or the net realizable value of such inventory. Cost is determined using the standard cost method which approximates actual costs using the first-in, first-out basis. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand, and remaining shelf life to record a provision for excess and slow-moving inventory. No inventory allowance has been recorded as of December 31, 2017 and March 31, 2018 .

The Company recognizes the cost of inventory transferred to the customer in cost of revenue when revenue is recognized.

Shipping and Handling Costs

Shipping and handling costs are expensed as incurred and are included in selling, general and administrative, or SG&A, expenses. Shipping and handling costs included in SG&A were $0.2 million for the three months ended March 31, 2017 and $0.3 million for the three months ended March 31, 2018 , respectively.

Revenue Recognition

▪ persuasive evidence of an arrangement exists;

▪ the sales price is fixed or determinable;

▪ collection of the relevant receivable is probable at the time of sale; and

▪ delivery has occurred or services have been rendered.

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Research and Development

Selling, General and Administrative Expenses

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation and amortization.

Goodwill and Intangible Assets

The Company records the excess of the acquisition purchase price over the net fair value of the tangible and identifiable

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intangible assets acquired and liabilities assumed as goodwill. In accordance with Accounting Standards Codification, or ASC, 350, Intangibles - Goodwill and Other, the Company tests goodwill for impairment annually during the fourth quarter of each year and whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. In connection with the annual impairment test for goodwill, the Company elected the option to perform a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If the Company determines that it was more likely than not that the fair value of the reporting unit is less than its carrying amount, then the impairment test is performed. Consistent with the Company's assessment that it has only one reporting segment, the Company has determined that it has only one reporting unit and tests goodwill for impairment at the entity level using the two-step process required by ASC 350. In the first step, the Company compares the carrying amount of the reporting unit to the fair value of the enterprise. If the fair value of the enterprise exceeds the carrying value, goodwill is not considered impaired and no further testing is required. If the carrying value of the enterprise exceeds the fair value, goodwill is potentially impaired and the second step of the impairment test must be performed. In the second step, the Company compares the implied fair value of the goodwill, as defined by ASC 350, to its carrying amount to determine the impairment loss, if any.

During the years ended December 31, 2016 and 2017 , there has been no impairment of goodwill or intangible assets based on the qualitative assessments performed by the Company. As of March 31, 2018 , no triggering events have occurred which would indicate that the acquired intangible asset values may not be recoverable.

Long-Lived Assets

The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. When such an event occurs, management determines whether there has been impairment by comparing the anticipated undiscounted future net cash flows to the related asset group’s carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. There were no impairment charges, or changes in estimated useful lives recorded d uring the years ended December 31, 2016 and 2017. As of March 31, 2018 , no triggering events have occurred which would indicate that the acquired intangible asset values may not be recoverable.

Debt and Embedded Derivatives

Debt Issuance Costs and Debt Discounts

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related to loans are calculated using the effective interest method over the term of the loan commitment, and is recorded as interest expense in the consolidated statements of operations.

Income Taxes

The Company operates in various tax jurisdictions and is subject to audit by various tax authorities.

The Company records uncertain tax positions based on a two-step process whereby (1) a determination is made as to whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold the Company recognizes the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. Significant judgment is required in the identification of uncertain tax positions and in the estimation of penalties and interest on uncertain tax positions.

There were no material uncertain tax positions in fiscal 2016 , 2017 and for the three months ended March 31, 2018 .

Foreign Currency

Comprehensive Income (Loss)

The Company’s comprehensive income consists of net loss and foreign currency translation adjustments arising from the consolidation of the Company’s foreign subsidiaries.

Share-Based Compensation

The company accounts for stock options and RSAs issued to non-employees under ASC 505-50 Equity: Equity-Based Payments to Non-Employees , using the Black-Scholes option valuation model to value stock options. The fair value of such non-employee awards is remeasured at each quarter-end over the vesting period.

The calculation of share-based compensation expense requires that the company make assumptions and judgments about the variables used in the Black-Scholes model, including the expected term, expected volatility of the underlying common shares, risk-free interest rate and dividends.

The company has adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting , under which it will recognize forfeitures as they occur rather than applying a prospective forfeiture rate in advance (see Note 10).

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

Net Income (Loss) Per Share

Basic net income (loss) per ordinary share is calculated by dividing the net income (loss) attributable to ordinary shareholders by the weighted-average number of ordinary shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net income (loss) per share is computed by dividing the net income (loss) attributable to ordinary shareholders by the weighted-average number of ordinary shares and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, any shares issuable upon the conversion of convertible notes payable, share warrants and share options and non-vested restricted stock units outstanding under the Company’s equity plan are potentially dilutive securities. Because the Company has reported a net loss in all periods presented, diluted net loss per ordinary share is the same as basic net loss per ordinary share for those periods because including the dilutive securities would be anti-dilutive.

Recent Accounting Standards

The following recent accounting pronouncements issued by the Financial Accounting Standards Board, or the FASB, could have a material effect on our financial statements:

Recently Adopted Accounting Standards

Recently Issued Accounting Standards

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respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than twelve months regardless of their classification. Leases with a term of twelve months or less will be accounted for similar to existing guidance for operating leases today. ASC 842 supersedes the previous leases standard, ASC 840 Leases. The standard is effective for non-public business entities for fiscal years beginning after December 15, 2018 and interim periods within fiscal years beginning after December 15, 2020.Early adoption is permitted. The Company is currently evaluating the effects, if any, that the adoption of this guidance will have on its consolidated financial statements.

In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting . This ASU provides amendments to the current guidance on determining which changes to the terms and conditions of share-based payment awards require the application of modification accounting. The effects of a modification should be accounted for unless there are no changes between the fair value, vesting conditions, and classification of the modified award and the original award immediately before the original award is modified. ASU 2017-09 is effective for non-public business entities for annual periods, including interim periods within those annual periods, beginning after December 15, 2017, with early adoption permitted. The adoption of this ASU is not expected to have a material impact on the financial statements.

3. Balance Sheet Accounts

Inventory




	December 31, 2017		March 31, 2018
	(in thousands)
Raw materials	$	1,978	$	1,903
Work in process	1,132		1,186
Finished goods	10,063		9,563
	$	13,173	$	12,652

Property and Equipment, Net




	December 31, 2017			March 31, 2018
	(in thousands)
Machinery and equipment	$	5,473		$	5,704
Vehicles	353			353
Furniture and fixtures	2,110			2,213
Leasehold improvements	8,743			8,756
Total	16,679			17,026
Less: Accumulated depreciation and amortization	(3,179		)	(3,663		)
	$	13,500		$	13,363

Depreciation and amortization expense for the three months ended March 31, 2017 and 2018 was $0.2 million and $0.5 million , respectively. The Company entered into capital leases relating to equipment and vehicles and recorded the fair value of the lease payments on the initial contract date, and is amortizing the assets over the term of the leases. As of December 31, 2017 and March 31, 2018 , the gross asset value for capital lease assets was $1.3 million . Depreciation expense for assets under capital leases is de minimus.

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Notes to Condensed Consolidated Financial Statements

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4. Goodwill and Other Intangible Assets

The Company’s goodwill and most intangibles at March 31, 2018 are the result of acquisitions of certain assets formerly owned by VeriTeQ Corporation in November 2015 and Femiline AB in November 2017 and business acquisitions of Establishment Labs Brasil Productos para Saude Ltda. in January 2016, European Distribution Center Motiva BVBA in March 2016 and Motiva Implants France in September 2016 (see Note 11). Finite-lived intangibles are amortized over their estimated useful lives based on expected future benefit.

There were no changes in the carrying amount of goodwill during the three months ended March 31, 2018 :




	Balance as of January 1, 2018		Additions		Accumulated Impairment Losses		Balance as of March 31, 2018
	(in thousands)
Goodwill	$	465	$	—	$	—	$	465

Only goodwill related to the 2017 acquisition is deductible for tax purposes (see Note 11).

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The carrying amounts of intangible assets as of December 31, 2017 were as follows:




	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Estimated Useful Lives
	(in thousands)							(in years)
Patents and license rights	$	1,635	$	(361	)	$	1,274	7-12
Customer relationships	1,304		(40		)	1,264		10
510(k) authorization	567		(80		)	487		15
Developed technology	62		(28		)	34		10
Capitalized software development costs	98		(49		)	49		2
Other	17		(15		)	2		2-3
Capitalized patents and license rights not yet amortized	291		—			291
Total intangible assets, net	$	3,974	$	(573	)	$	3,401

The carrying amounts of these intangible assets as of March 31, 2018 were as follows:




	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Estimated Useful Lives
	(in thousands)							(in years)
Patents and license rights	$	1,657	$	(410	)	$	1,247	7-12
Customer relationships	1,304		(121		)	1,183		10
510(k) authorization	567		(90		)	477		15
Developed technology	62		(29		)	33		10
Capitalized software development costs	98		(61		)	37		2
Other	17		(15		)	2		2-3
Capitalized patents and license rights not yet amortized	291		—			291
Total intangible assets, net	$	3,996	$	(726	)	$	3,270

The amortization expense associated with intangible assets was $0.2 million for the three months ended March 31, 2017 and 2018 . In fiscal 2017, all amortization expense was recorded in cost of revenue as non-product related amortization was de minimus. In fiscal 2018, non-product related amortization was recorded in selling, general and administrative expense.

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

As of March 31, 2018 , the amortization expense related to identifiable intangible assets, with definite useful lives, in future periods is expected to be as follows:




Year Ending December 31,	(in thousands)
2018 (remaining)	$	477
2019	551
2020	551
2021	511
2022	215
Thereafter	674
Total	$	2,979

The Company evaluates the recoverability of goodwill and indefinite-lived intangible assets annually and whenever events or changes in circumstances indicate to us that the carrying amount may not be recoverable. As of March 31, 2018 , no triggering events have occurred which would indicate that the acquired intangible asset values may not be recoverable.

5. Fair Value Measurements

The fair value hierarchy defines a three-level valuation hierarchy for disclosure of fair value measurements as follows:


▪	Level I Unadjusted quoted prices in active markets for identical assets or liabilities;


▪	Level II Inputs other than quoted prices included within Level I that are observable, unadjusted quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and


▪	Level III Uno bservable inputs that are supported by little or no market activity for the related assets or liabilities.

The categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

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The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy at period end:




	Fair Value Measurements at December 31, 2017
	Total		Level 1		Level 2		Level 3
	(in thousands)
Liabilities
Madryn put option liability	$	20,302	$	—	$	—	$	20,302
Madryn call option liability	360		—		—		360
Acquisition-related contingent consideration	964		—		—		964
	$	21,626	$	—	$	—	$	21,626




	Fair Value Measurements at March 31, 2018
	Total		Level 1		Level 2		Level 3
	(in thousands)
Liabilities
Madryn put option liability	$	21,744	$	—	$	—	$	21,744
Madryn call option liability	223		—		—		223
Acquisition-related contingent consideration	1,327		—		—		1,327
	$	23,294	$	—	$	—	$	23,294

The fair value measurement of derivatives and contingent consideration related to the business acquisition completed in fiscal 2017 is based on significant inputs not observed in the market and thus represents a Level 3 measurement.

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Notes to Condensed Consolidated Financial Statements

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The Company used the following assumptions to value Madryn derivatives:

Put Option Liability (Madryn)




	December 31, 2017	March 31, 2018
Interest rate volatility	21.00%	21.00%
Market yield rate	12.50%	11.00%
Term (in years)	5.50	5.25
Dividend yield	—%	—%

Call Option Liability (Madryn)




	December 31, 2017	March 31, 2018
Interest rate volatility	21.00%	21.00%
Market yield rate	12.50%	11.00%
Term (in years)	5.50	5.25
Dividend yield	—%	—%

In order to assess the fair value of our ordinary shares, our business enterprise value, or BEV, is determined and then allocated to each element of our capital structure (ordinary shares, warrants and options). Our BEV is estimated using the income approach and the market approach. The discounted cash flow method, or DCF, estimates the enterprise value based on the estimated present value of future net cash flows the business is expected to generate over a forecasted period and an estimate of the present value of cash flows beyond that period, which is referred to as terminal value. The estimated present value is calculated using a discount rate known as the weighted average cost of capital, which accounts for the time value of money and the appropriate degree of risks inherent in the business. Under the market approach, the enterprise value is based on the multiples of comparable companies and transactions. The BEV is allocated using probability-weighted expected return method, or PWERM, which estimates the fair value of common shares based on an analysis of future values for the enterprise assuming various future outcomes.

As of December 31, 2017 and March 31, 2018, the short term and long term portions of contingent consideration liability were included in “Other liabilities, short term” and “Other liabilities, long term”, respectively.

The estimates are based, in part, on subjective assumptions and could differ materially in the future.

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial instruments as follows:




	Warrant Liability		Acquisition-related Contingent Consideration		Put Option Liability (Madryn)		Call Option Liability (Madryn)
Balance at December 31, 2016	$	3,983	$	—	$	—	$	—
Change in fair value	373		—		—		—
Balance at March 31, 2017	$	4,536	$	—	$	—	$	—

Balance at December 31, 2017	$	—	$	964	$	20,302	$	360
Change in fair value	—		363		1,442		(137		)
Balance at March 31, 2018	$	—	$	1,327	$	21,744	$	223

6. Debt

Notes Payable Related Party

In August 2015, the Company entered into agreements with all of the Class Z redeemable convertible preferred shareholders to exchange their outstanding shares and accumulated dividends for notes payable with a principal balance of $4.2 million . Per the original agreement, the notes bear interest at a simple rate of 7% per annum with the interest payments due annually starting March 30, 2017 and a note maturity date of March 31, 2020. Annual payments are due based on achievement of certain annual sales milestones beginning in March 2017. In March, 2017, the Company modified the agreement to defer the interest payments for an additional period, which will be thirty days after the Company successfully completes its planned IPO. Upon the effectiveness of an IPO, the notes will become due and payable in full. During the three months ended March 31, 2017 and 2018 , the Company recorded interest expense of $0.1 million, to accrue for interest due on the notes. The Company recorded notes payable related party on the balance sheet as follows:




	December 31, 2017		March 31, 2018
	(in thousands)
Principal	$	4,218	$	4,218
Accrued interest	703		776
Total principal and accrued interest at end of period	$	4,921	$	4,994

Related Party Convertible Notes Payable

In August 2015, the Company entered into a Note and Warrant Purchase Agreement, or the Note Agreement or the

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

Notes, with CPH, a primary shareholder, to borrow up to $15.0 million. The Notes issued pursuant to the agreement bore interest at a simple rate of 10% per annum.

The Company determined that the Note Agreement contained several put options related to liquidity events or an event of default. The Company valued these put options, and allocated the fair value of $0.1 million for these identified embedded derivatives as a debt discount on the original commitment date in August 2015. The Company revalued the put options as of each reporting period, and recorded the change in the fair value in the consolidated statement of operations as other income or expense (see Note 5).

August 2017 Conversion

There was no outstanding balance under the Notes as of December 31, 2017 or March 31, 2018.

Madryn Debt

On August 24, 2017 the Company entered into a credit agreement, or the Madryn Credit Agreement, with Madryn Health Partners, LP, or Madryn, as administrative agent, and a syndicate of lenders. The Madryn Credit Agreement provides for a credit facility for a maximum principal amount of $55.0 million , $30.0 million (Term A) of which became available upon signing. The final maturity date under the Madryn Credit Agreement is June 30, 2023.

The availability of the additional Term B and Term C commitments under the Madryn Credit Agreement, which are for an aggregate principal amount of up to $25 million, are subject to the Company achieving certain revenue milestones. The Company met some of these milestones and borrowed an additional $5.0 million (Term B-1) on October 31, 2017 and $5.0 million (Term B-2) on December 15, 2017 bringing up the total outstanding principal balance to $40.0 million as of December 31, 2017. As of June 15, 2018, we were eligible to draw down an additional $5.0 million (Term B-3) under the amended Credit Agreement, and an additional $10.0 million (Term C) may become available on June 30, 2020 if the required milestones for this tranche are achieved . The Company has not yet met the required milestones for the Term C tranche as of the date of the issuance of these interim financial statements. The availability of each tranche is also conditioned on the Company having advanced the maximum loan amount under each prior tranche.

In connection with the Madryn Credit Agreement, the Company and certain of its subsidiaries, granted a security interest in substantially all of the property of the Company and certain of its subsidiaries, including, without limitation, intellectual property, and pledges of certain shares of the Brazilian subsidiary and the Belgian subsidiary, subject to certain excluded collateral exceptions.

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

annum. The weighted average interest rate under the credit agreement was approximately 12.7 % at March 31, 2018 . The Company incurred $1.4 million in interest expense in connection with Madryn Credit Agreement in fiscal 2017 and $1.3 million during the three months ended March 31, 2018. No principal payments are due until 2021. Eight quarterly payments of 12.5% of the principal amounts borrowed under each tranche are due beginning September 30, 2021 and each quarter end through and including June 30, 2023.

The Company also determined that the Madryn Credit Agreement contained put options which are mandatory repayment provisions related to liquidity events or an event of default and a call option related to voluntary repayment option. The Company valued these put options and the call option, and allocated a fair value of $15.1 million for these identified embedded derivatives as a debt discount on the original commitment date in August 2017. An additional $5.0 million debt discount was recorded on respective borrowing dates when the Company met the required milestones and borrowed an additional $10.0 million in the fourth quarter of fiscal 2017. The Company revalues the options as of each reporting period, and records the change in the fair value in the consolidated statement of operations as other income or expense (see Note 5). The Company also incurred legal expenses of $1.3 million in the third quarter of fiscal 2017, which were recorded as a debt discount and are being amortized over the term of the Madryn Credit Agreement.

In January 2018, management made an assessment that the Company would likely default on the Madryn Credit Agreement due to its investment in our Brazilian subsidiary approaching the $5.0 million limit. The Company informed Madryn and the syndicate of lenders, or the Lenders, of the potential technical default event and started the process to obtain a forbearance agreement. The Company initially defaulted on the Madryn Credit Agreement on January 19, 2018 when it failed to put a Qualifying Control Agreement in place for certain bank deposit accounts and subsequently on February 28, 2018 when its investment in its Brazilian subsidiary exceeded the allowable $5.0 million threshold permitted under the Madryn Credit Agreement. As a result, the Company entered into a forbearance agreement with the Lenders, where the Lenders agreed to forebear from exercising certain rights and remedies through May 18, 2018 and subsequently through July 3, 2018 arising from certain disclosure and other technical defaults under the Madryn Credit Agreement, including those mentioned above with respect to our Brazilian subsidiary. In accordance with certain cure rights under the Madryn Credit Agreement and the forbearance agreement terms, the Company will use its best efforts to raise no less than $20.0 million of cash proceeds from equity issuances. Furthermore, the forbearance agreement permits the limit of the amount of investment in the Brazilian subsidiary not to exceed an additional $5.0 million, and maintain the liquidity in accounts for which Madryn received a qualifying control agreement of no less than $2.0 million, while the Company provides periodic reports on all investments in the Brazilian subsidiary. The forbearance agreement also forbears the lenders from exercising certain rights and remedies in the event of our failure to provide the report and opinion of an independent certified public accountant free from any “going concern” qualifications for the fiscal year ended December 31, 2017.

Accordingly, the Company recorded the Madryn debt as a current liability on the consolidated balance sheet as of December 31, 2017. Effective June 15, 2018, Madryn Credit Agreement was amended to remove the restrictive covenants that resulted in the technical defaults which allowed the Company to reclassify the arrangement as long-term as of March 31, 2018.

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

The Company recorded Madryn debt on the balance sheet as follows:




	December 31, 2017			March 31, 2018
	(in thousands)
Principal	$	40,000		$	40,000
Accrued interest	—			—
Total principal and accrued interest at end of period	40,000			40,000
Net unamortized debt discount and issuance costs	(20,833		)	(20,092		)
Net carrying value of Madryn debt	$	19,167		$	19,908

The Company granted Madryn the right to purchase up to $2.0 million of shares issued by the Company in the next succeeding eligible equity investment in the Company. The Company has completed qualified financings during the first half of 2018, and Madryn chose not to exercise their right to purchase shares in those financings. Under this agreement, to the extent the Company redeems or repurchases any shares from any holder, the Company shall offer to resell one half of the repurchased shares to Madryn at the same price paid by the Company to purchase or retire the shares. To the extent Madryn elects to purchase the repurchased shares, the amount paid by Madryn shall reduce the amount of investment available in the next eligible equity investment. The Company has not repurchased shares since August 2017.

7. Commitments and Contingencies

Operating Leases

Rent expense for the three months ended March 31, 2017 and 2018 was $0.2 million .

Future minimum lease payments under the operating leases as of March 31, 2018 are as follows:




Years Ending December 31,	Operating Leases
	(in thousands)
2018 (remaining)	$	557
2019	610
2020	580
2021	503
2022	524
Thereafter	2,056
	$	4,830

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

Capital Lease

The Company entered into capital lease arrangements relating to software, equipment and vehicles. The lease period is from one to seven years. The repayments are made monthly with an interest rate ranging from 4% to 7% per year.

Future minimum lease payments under these capital leases as of March 31, 2018 are as follows:




Years Ending December 31,	Capital Leases
	(in thousands)
2018 (remaining)	$	248
2019	319
2020	227
2021	132
2022	34
Thereafter	—
	960
Interest included in the above payments	(113		)
Amount payable without interest	847
Short term minimum capital lease payments (included in accrued liabilities)	312
Long term minimum capital lease payments	$	535

Contingencies

Indemnification

The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with such indemnifications has been recorded to date.

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8. Shareholders’ Equity (Deficit)

General

Under the Memorandum of Association and Articles of Association, or Articles, in effect as of December 31, 2017, the Company had authorized 84,050,000 common shares with a par value of $1.00 per share, 13,482,782 Class A ordinary shares with a par value of $1.00 per share, 7,723,848 Class B ordinary shares with a par value of $1.00 per share, 96,301 Class C ordinary shares with no par value, 1,539,359 Class D ordinary shares with no par value, 323,366 Class E ordinary shares with no par value and 357,143 Class F ordinary shares with no par value. In January 2018, the Company amended its Articles to authorize 1,250,000 Class G ordinary shares with no par value.

Common Shares

No common shares have been issued to date.

Ordinary Shares

As of December 31, 2017 and March 31, 2018, 15,743,705 and 15,992,593 shares, respectively, of ordinary shares were issued and 14,522,495 and 14,771,383 shares, respectively, were outstanding.

Class A and B

As of December 31, 2017 and March 31, 2018, 13,427,536 and 13,575,809 shares, respectively, of ordinary Class A and Class B shares were issued and 12,206,326 and 12,354,599 shares, respectively, were outstanding. Class A and Class B ordinary shares have a par value of $1.00 per share.

During the three months ended March 31, 2018, the Company issued restricted stock awards to employees and contractors. The Company records the awards as outstanding equity as they vest (see Note 10).

Ordinary Class A and B shares had the following rights as of December 31, 2017 and March 31, 2018:

Voting Rights. Each holder of the Company’s ordinary shares is entitled to one vote for each share on all matters submitted to a vote of the shareholders, including the election of directors.


a.	liquidate, dissolve or wind-up the business and affairs of the Company, effect any merger or consolidation or any other Deemed Liquidation Event, as defined in the Memorandum and Articles of Association (“M&A”), or consent to any of the foregoing;


b.	amend, alter or repeal any provision of the Memorandum and the Articles;

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Notes to Condensed Consolidated Financial Statements

(Unaudited)


f.	encumber or grant a security interest in any of the Company’s property (tangible or intangible) or business;


g.	grant an exclusive license for, or create a negative pledge for, all or substantially all of the Company’s intellectual property assets;


h.	authorize a non pro-rata Distribution;


i.	increase or decrease the authorized number of directors constituting the Board; or


j.	permit any subsidiary to do any of the foregoing.

Redemption. The ordinary shares may be redeemed by the Company at any time based on a resolution of the Board of Directors.

Dividends. Holders of the Company’s ordinary shares are entitled to receive dividends, if any, as may be declared from time to time by its Board of Directors out of legally available funds.

Class C, D, E, F and G

As of December 31, 2017 and March 31, 2018, 2,316,169 and 2,416,784 shares, respectively, of ordinary Class C, D, E, F and G shares were issued and outstanding. Class C, D, E, F and G shares have no par value.

In multiple closings during the first three months ended March 31, 2018, the Company issued an aggregate of $1.6 million of Class G ordinary shares at a purchase price of $16.00 per share to several investors . In connection with the issuance of these shares, the Company amended and restated its memorandum of association to increase the authorized shares of the Company to a total of 108,822,799 shares and to authorize 1,250,000 Class G shares.

The documents effecting the sale and issuance of these shares contain customary voting, registration, right of first refusal and co-sale rights.

Class C, D, E,F and G ordinary shares have the following rights:

Redemption. The ordinary shares may be redeemed by the Company at any time based on a resolution of the Board of Directors.

Dividends. Holders of the Company’s ordinary shares are entitled to receive dividends, if any, as may be declared from time to time by its Board of Directors out of legally available funds.

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The Company had reserved ordinary shares for future issuances as follows:




	December 31, 2017	March 31, 2018
Warrants to purchase ordinary shares	145,000	145,000
Options to purchase ordinary shares	863,932	983,739
Remaining shares available under the 2015 Equity Incentive Plan	91,181	375,121
Shares issuable on vesting of restricted stock awards	585,056	433,031
Total	1,685,169	1,936,891

In January 2018, the Company increased the number of Class A shares reserved for 2015 Equity Incentive Plan by 400,000 shares to a new total of 2,650,000 shares.

9. Warrants

CPH

In connection with the Notes issued to CPH in August 2015, the Company agreed to issue warrants to purchase ordinary shares to CPH and to Rockport Ventures, the placement agent for the Notes.

As of December 31, 2017 and March 31, 2018, the 145,000 warrants to purchase ordinary shares were outstanding and exercisable:

Warrant Holder

Issue Date

In Connection With

Warrant to
Purchase

Exercise
Price

Expiration Date

Rockport

3/3/2017

Loan agreement

Ordinary

145,000

3.80

8/28/2022

In July 2017, the Company early adopted ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities From Equity (Topic 480); Derivatives And Hedging (Topic 815): (Part I) Accounting For Certain Financial Instruments With Down Round Features, (Part Ii) Replacement Of The Indefinite Deferral For Mandatorily Redeemable Financial Instruments Of Certain Nonpublic Entities And Certain Mandatorily Redeemable Noncontrolling Interests With A Scope Exception. As a result, certain warrants that were previously classified as a liability due to an existence of down round

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

features became qualified to be classified as equity. The adoption of this standard resulted in $1.0 million reclassification of warrant liability into additional paid in capital as of July 1, 2017.

10. Share-Based Compensation

The 2015 Plan, as amended, reserves 2,650,000 Class A shares for issuance. If an award granted under the 2015 Plan expires, terminates, is unexercised, or is forfeited, or if any shares are surrendered in connection with an incentive award, the shares subject to such award and the surrendered shares will become available for further awards under the 2015 Plan.

During the three months ended March 31, the Company recorded the following share-based compensation expense for stock options and restricted stock awards:




	2017		2018
	(in thousands)
Sales, general and administrative	$	370	$	102
Research and development	752		641
Total	$	1,122	$	743

Stock Options




	Number of Options Outstanding		Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Balances at December 31, 2016	793,451		$	4.11	9.7	$	3,309
Granted (weighted-average fair value of $5.18 per share)	189,982		9.81
Forfeited/canceled	(119,501	)	4.11
Balances at December 31, 2017	863,932		$	5.36	7.6	$	4,199
Granted (weighted-average fair value of $5.86 per share)	248,128		10.19
Exercised	(106,248	)	4.11
Forfeited/canceled	(22,073	)	4.11
Balances at March 31, 2018	983,739		$	6.74	9.0	$	6,420

As of March 31, 2018 , 346,572 options were vested and exercisable with weighted-average exercise price of $4.45 per share and a total aggregate intrinsic value of $3.1 million.

There were no exercises of stock options during the year ended December 31, 2017. During the three months ended March 31, 2018 , 106,248 options were exercised at a price of $4.11 per share. Upon the exercise of stock options, the Company issued new Class A ordinary shares from its authorized shares.

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

At March 31, 2018 , unrecognized compensation expense was $1.5 million related to stock options granted to employees and Board of Directors and $1.8 million related to stock options granted to consultants. The weighted-average period over which such compensation expense will be recognized is 3.0 years.

Stock Options Granted to Employees

Share-based compensation expense for employees is based on the grant date fair value. The Company recognizes compensation expense for all share-based awards on a straight-line basis over the requisite service period of the awards, which is generally the vesting term of four years. During the three months ended March 31, 2017 and 2018 , the Company recognized $39,000 and $0.1 million , respectively, of stock-based compensation expense for stock options granted to employees.

▪

Fair Value of Common Shares. As the ordinary shares are not publicly traded, the Company must estimate their fair value. The fair value of ordinary shares was determined on a periodic basis by the Company’s Board of Directors, with the assistance of an independent third-party valuation firm. The Board of Directors intended all options granted to be exercisable at a price per share not less than the estimated per share fair value of the shares underlying those options on the date of grant.


▪	Risk-Free Interest Rate. The Company bases the risk-free interest rate used in the Black-Scholes valuation model on the implied yield available on U.S. Treasury zero-coupon issues with a term equivalent to that of the term of the options for each option group on the measurement date.

▪

Term. For employee stock options, the expected term represents the period that the Company’s share-based awards are expected to be outstanding. Because of the limitations on the sale or transfer of the Company’s shares as a privately held company, the Company does not believe its historical exercise pattern is indicative of the pattern it will experience as a publicly traded company. The Company has consequently used the Staff Accounting Bulletin 110, or SAB 110, simplified method to calculate the expected term of employee stock options, which is the average of the contractual term and vesting period. The Company plans to continue to use the SAB 110 simplified method until it has sufficient trading history as a publicly traded company. For consultant stock options, the term used is equal to the remaining contractual term on the measurement date.

▪

Volatility. The Company determines the price volatility based on the historical volatilities of industry peers as it has no trading history for its shares. Industry peers consist of several public companies in the medical device industry with comparable characteristics, including revenue growth, operating model and working capital requirements. The Company intends to continue to consistently apply this process using the same or a similar peer group of public companies until a sufficient amount of historical information regarding the volatility of its own shares becomes available, or unless circumstances change such that the identified peer companies are no longer similar, in which case other suitable peer companies whose common share prices are publicly available would be utilized in the calculation. The volatility is calculated based on the term on the measurement date.


▪	Dividend Yield. The expected dividend assumption is based on the Company’s current expectations about its anticipated dividend policy. The Company has no expectation that it will declare dividends on its ordinary shares, and therefore has used an expected dividend yield of zero.

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The Company did not grant any stock options to employees during fiscal 2017.

The fair value of stock options granted to employees during t hree months ended March 31, 2018 was estimated using the following assumptions:




		March 31, 2018
Volatility		57%
Risk-free interest rate		2.71
Term (in years)		6.25
Dividend yield		0%

Stock Options Granted to Non-Employees

Stock-based compensation expense related to stock options granted to nonemployees is recognized as the stock options are earned using an accelerated attribution method. The Company believes that the estimated fair value of the stock options is more readily measurable than the fair value of the services rendered. For the three months ended March 31, 2017 and 2018 , the Company recognized expense of $0.4 million and $0.5 million for stock options granted to consultants.

The fair value of stock options granted to consultants was estimated using the following assumptions:




	December 31, 2017	March 31, 2018
Volatility	59%	59%
Risk-free interest rate	2.4%	2.8%
Term (in years)	10	10
Dividend yield	0%	0%

Restricted Stock Awards

Each vested RSA entitles the holder to be issued one share of Class A ordinary shares. Restricted stock awards vest according to a vesting schedule determined by the Compensation Committee of the Company’s Board of Directors, generally over a one to four year period.

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The following table represents RSA activity for fiscal 2017 and fiscal 2018:




	Restricted Stock Awards		Weighted- Average Grant Date Fair Value
Outstanding unvested at December 31, 2016	454,154		$	4.11
Granted	525,230		9.56
Vested	(197,978	)	5.89
Forfeited/canceled	(196,350	)	8.52
Outstanding unvested at December 31, 2017	585,056		8.57
Granted	—		7.57
Vested	(42,025	)	5.57
Forfeited/canceled	(110,000	)	9.60
Outstanding unvested at March 31, 2018	433,031		$	7.09

The fair value of RSAs is the grant date market value of the Class A ordinary shares. The Company recognizes share-based compensation expense related to RSAs using a straight-line method over the vesting term of the awards. The fair value of RSAs that vested during during the three months ended March 31, 2017 and 2018 , was $0.7 million and $0.1 million , which was calculated based on the market value of the Company’s ordinary shares on the applicable date of vesting.

11. Business Combinations

Sweden

On November 17, 2017, the Company and Femiline AB and Johan Anderson, or the Seller, entered into an agreement to purchase certain assets from the Seller. The assets purchased included all existing inventory previously sold by the Company to the Seller, all customer relationships and a covenant not to compete. The aggregate purchase price for the assets purchased was 100,000 Class A Ordinary shares of the Company, contingently issuable upon achievement of specific milestones. Based on the valuation of the Company’s shares performed by a valuation specialist, the contingently issuable shares had an aggregate value of $1.0 million . The book value of the inventory at the time of the acquisition was approximately $0.7 million, which was revalued on the transaction date to be the estimated selling price less the cost to sell, which increased the fair value of the inventory to approximately $1.5 million.

This transaction will enable the Company to restructure its existing distribution network in Sweden, Denmark and Norway and initiate direct sales to customers in the region.

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The purchase price and allocation of purchase price were as follows:




Purchase Price:	(in thousands)
Cash consideration	$	1,000
Fair market value of Class A ordinary shares issued	344
Contingent consideration	964
Cash paid for inventory	704
Total purchase price	$	3,012




Allocation of Purchase Price:	(in thousands)
Inventory	$	1,498
Customer relationships	1,280
Covenant not to compete	24
Goodwill	210
Total purchase price allocated	$	3,012

As of December 31, 2017 and March 31, 2018, the consideration of $1.0 million to Novaform and $0.7 million to Femiline AB has not been paid and is included in “Accounts payable”.

Only the goodwill related to the 2017 acquisition is deductible for tax purposes.

12. Net Income (Loss) Per Share

The following table summarizes the computation of basic and diluted net loss per share for the three months ended March 31:




	2017			2018
	(in thousands, except share and per share data)
Numerator:
Net loss	$	(4,999	)	$	(6,530	)
Denominator:
Weighted average ordinary shares	6,633,635			14,662,092
Net loss per share, basic and diluted	$	(0.75	)	$	(0.45	)

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The following potentially dilutive securities outstanding at the end of the periods presented have been excluded from the computation of diluted shares outstanding at March 31:




	2017	2018
Shares issuable on conversion of related party convertible notes payable	5,869,417	—
Options to purchase ordinary shares	765,056	983,739
Shares issuable on vesting of restricted stock awards	579,344	433,031
Warrants to purchase ordinary shares	726,074	145,000
Total	7,939,891	1,561,770

13. Related Party Transactions

In August 2017, the Company entered into a credit agreement with Madryn and a syndicate of lenders to borrow up to $55.0 million (see Note 6). As of March 31, 2018 , Madryn owns approximately 5.0% of the ordinary shares of the Company.

During the three months ended March 31, 2017 and 2018 , the Company recorded revenue of $0.2 million and $0.3 million , respectively, for product sales to Herramientas Medicas, S.A., a distribution company owned by a family member of the Chief Executive Officer of the Company. Accounts receivable owed to the Company from this distribution company amounted to approximately $0.1 million and $0.2 million as of December 31, 2017 and March 31, 2018 , respectively.

In September 2016, the Company entered into a share repurchase agreement with Global Silicone SRL for the repurchase of 813,140 ordinary shares of the Company owned by Global Silicone SRL in exchange for $3.7 million. In October 2016, the Company paid $2.0 million to Global Silicone SRL to repurchase 440,040 shares and the

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ESTABLISHMENT LABS HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

remaining $1.7 million was paid in April 2017. In July 2017, the Company paid $2.8 million to repurchase additional 406,570 Class A ordinary shares from Global Silicone SRL.

In May 2016, the Company entered into a scientific board advisory agreement with Dr. Manuel Enrique Chacon Quiros pursuant to which Dr. Chacon Quiros joined the Company’s Scientific Advisory Board, provides general scientific advice, and serves as a clinical investigator, among other services. In exchange for these services, Dr. Chacon Quiros was granted options to purchase 20,580 shares, vesting over four years in equal annual installments, provided that he continues to provide these services at such times. In September 2016, the Company entered into a separate agreement whereby Dr. Chacon Quiros will maintain his clinic in Costa Rica as a MotivaImagine Excellence Center and will host and train physicians in the use of the Company products in relevant procedures, among other services, in exchange for cash reimbursement of up to $4,500 per day that such services are rendered. Dr. Chacon Quiros is the brother of our Chief Executive Officer, Juan Jose Chacon Quiros. During the three months ended March 31, 2017 and 2018, the Company paid Dr. Chacon Quiros approximately $30,000 and $38,000, respectively, for services rendered.

During the March 31, 2018 , the Company recorded revenue of approximately $40,000 for product sales to Motiva Netherlands BV, a distribution company owned by Erick Vogelanzeng, our Vice President of Sales, Europe . Accounts payable due to this distribution company amounted to zero as of December 31, 2017 and approximately $56,000 at March 31, 2018.

14. Subsequent Events

The Company has reviewed and evaluated subsequent events that occurred through June 21, 2018 .

In multiple closings between April and June 2018, the Company issued an aggregate of $4.6 million of Class G ordinary shares at a purchase price of $16.00 per share to several investors . On May 17, 2018, the Company issued 625,000 shares of Class G-1 ordinary shares at a purchase price of $16.00 per share to entities affiliated with RTW Investments for an aggregate purchase price of $10.0 million. In connection with the issuance of these shares, the Company amended and restated its Articles to increase the authorized shares of the Company to a total of 109,447,799 shares and to authorize 625,000 Class G-1 shares.

On May 18, 2018, the Company’s wholly-owned subsidiary in Belgium entered into a lease agreement for an office rental for an approximate annual base lease amount of $0.2 million per year for a duration of nine years.

Between April and June 21, 2018 , the Board of Directors approved grants of 81,500 shares of stock options and 68,233 of restricted stock awards.

On June 15, 2018, the Company amended Mardyn Credit Agreement to remove the restrictive covenants that resulted in the technical defaults in the first quarter of 2018. This allowed the Company to reclassify the Madryn debt as long-term as of March 31, 2018.

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Common Shares

______________________________________________

PRELIMINARY PROSPECTUS

______________________________________________

Joint Book-Running Managers

Jefferies

Cowen

Lead Manager

BTIG

, 2018

Until , 2018 (25 days after the commencement of this offering), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This delivery requirement is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

Table of Contents

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth all expenses to be paid by the Registrant, other than underwriting discounts and commissions, upon completion of this offering. All amounts shown are estimates except for the SEC registration fee and the FINRA filing fee.




	Amount To Be Paid
SEC registration fee	$	*
FINRA filing fee		*
Nasdaq Capital Market listing fee		*
Printing and engraving		*
Legal fees and expenses		*
Accounting fees and expenses		*
Transfer agent and registrar fees		*
Miscellaneous		*
Total	$	*


*	To be filed by amendment.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

British Virgin Islands law does not limit the extent to which a company’s articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the British Virgin Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. The Registrant’s amended and restated memorandum and articles of association will provide for the indemnification of its directors against all losses or liabilities incurred or sustained by him or her as a director of the Registrant in defending any proceedings, whether civil, criminal, administrative or investigative in which the director acted honestly and in good faith with a view to the best interest of the company and had no reasonable cause to believe that their conduct was unlawful.

The Registrant’s policy is to enter into separate indemnification agreements with each of its directors and certain officers that provide the maximum indemnity allowed to directors and executive under British Virgin Islands law and also to provide for certain additional procedural protections. The Registrant also maintains directors and officers insurance to insure such persons against certain liabilities.

These indemnification provisions and the indemnification agreements entered into between the Registrant and its directors and officers may be sufficiently broad to permit indemnification of the Registrant’s officers and directors for liabilities (including reimbursement of expenses incurred) arising under the Securities Act of 1933, as amended, or the Securities Act.

The underwriting agreement to be filed as Exhibit 1.1 to this registration statement provides for indemnification by the underwriters of the Registrant and its officers and directors for certain liabilities arising under the Securities Act and otherwise.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

Since January 1, 2015, we have issued and sold to third parties the securities listed below without registering the securities under the Securities Act. None of these transactions involved any public offering. All our securities were sold

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through private placement either (i) outside the United States or (ii) in the United States to a limited number of investors in transactions not involving any public offering. As discussed below, we believe that each issuance of these securities was exempt from, or not subject to, registration under the Securities Act, relying on Section 4(a)(2) (or Regulation D promulgated thereunder), Regulation S or Rule 701 of the Securities Act.


▪	In August 2015, all of the 7,364 outstanding Class Z preferred shares were exchanged for promissory notes issued by us to former Class Z preferred shareholders in the aggregate amount of $4.3 million.

▪

In August 2015, we entered into a note and warrant purchase agreement with CPH TU, LP, or CPH, and was issued a convertible promissory note in the principal amount of $10.0 million and an associated warrant. In January 2016, we amended the note and warrant purchase agreement to increase the aggregate borrowing limit and issued a second convertible promissory note in the principal amount of $3.0 million and an associated warrant. In March 2016, we issued a third convertible promissory note in the principal amount of $5.0 million and, in August 2015, upon further amendment of the note and warrant purchase agreement, we issued a fourth convertible promissory note in the principal amount of $1.8 million, along with an associated warrant. In September 2016, we amended the note and warrant purchase agreement in order to (1) fix the conversion ratio to $3.99 per share for the principal amounts, and $4.9143 per share for the interest amounts; (2) convert all outstanding interest accrued under the notes as of such date into a fifth convertible promissory note in the principal amount of $4.3 million; and (3) cancel all warrants previously issued to CPH.

▪

In connection with the convertible promissory notes and warrants issued to CPH pursuant to the note and warrant purchase agreement described above, we issued a warrant to purchase ordinary shares to Rockport Venture Securities, LLC, the placement agent for the notes. The number of shares for which such warrant may be exercised is determined by dividing an amount equal to 3% of the principal up to $15.0 million by a pre-determined ratio of the fully diluted shares outstanding on the date of conversion. The Rockport warrants were immediately exercisable and will expire seven years from the original issuance date.


▪	Pursuant to asset purchase agreement entered into with Magna Equities I, LLC, or Magna, in November 2015, we issued Magna 130,354 Class A ordinary shares as partial consideration for certain assets of VeriTeQ Corporation. In May 2016, we reached an agreement to repurchase the shares from Magna for $1.0 million.


▪	Pursuant to a share purchase agreement with EDC Motiva BVBA, or EDC, in March 2016, we acquired all of the outstanding and issued shares of EDC in exchange for the issuance of 18,000 Class A ordinary shares to Paul Brusseleers, the former sole shareholder of EDC Motiva BVBA. This issuance occurred in September 2016.


▪	In September 2016, we entered into a share repurchase agreement with Global Silicone SRL pursuant to which we repurchased 813,140 ordinary shares owned by Global Silicone SRL for $3.7 million.


▪	In September 2016, we entered into a credit agreement and guaranty with Perceptive Credit Holdings, L.P. In connection with this agreement, we borrowed $15.0 million, and issued a warrant to purchase 556,100 ordinary shares with an initial exercise price of $0.01 per share. Under certain conditions, we is obligated to repurchase the warrant for $5.9 million.


▪	In January 2017, we issued secured promissory notes to Mr. Chacon-Quiros, the Company’s Chief Executive Officer and director, and to CPH TU, LLP, a principal shareholder and related party, in an aggregate principal amount of $1.2 million under existing note purchase, security and pledge agreements.


▪	In January 2017, we issued an aggregate of $0.9 million of Class C ordinary shares at a purchase price of $9.53 per share to several investors.


▪	Between February 2017 and May 2017, we issued an aggregate of $17.4 million of Class D ordinary shares at a purchase price of $11.30 per share to several investors in multiple closings. The documents effecting the sale and issuance of these shares contain customary voting, registration, right of first refusal and co-sale rights.


▪	Between August 2017 and October 2017, we issued an aggregate of $4.5 million of Class E ordinary shares at a purchase price of $14.00 per share to several investors in multiple closings;


▪	Between August 2017 and October 2017, we issued an aggregate of $5 million of Class E ordinary shares at a purchase price of $14.00 per share to several investors in multiple closings;


▪	Between February 2018 and June 2018, we issued an aggregate of $6.2 million of Class G ordinary shares at a purchase price of $16.00 per share to sever al investors; and


▪	In May 2018, we issued an aggregate $10.0 million Class G-1 ordinary shares at a purchase price of $16,00 per share to entities affiliated with RTW Investments.

In addition, between August 2016 and June 2018, the board of directors granted 1,561,513 restricted Class A ordinary shares to employees and consultants and options to purchase 1,357,197 Class A ordinary shares to employees and consultants at an exercise price of between $4.11 and $10.19 per share. We believe that the issuance of these securities were exempt from registration under the Securities Act in reliance upon Regulation S or Rule 701 of the Securities Act as transactions pursuant to written compensatory plans or pursuant to a written contract relating to

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compensation. No underwriters were employed in connection with the foregoing option grants and restricted share unit awards.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) Exhibits.

The Registrant filed the following exhibits as part of this registration statement.




Exhibit Number		Description of Exhibit
1.1*		Form of Underwriting Agreement.
3.1		Memorandum of Association of the Registrant, currently in effect, as amended on June 19, 2018.
3.2*		Form of Memorandum of Association of the Registrant, to be in effect upon completion of the offering.
3.3		Articles of Association of the Registrant, currently in effect, as amended on June 19, 2018.
3.4*		Form of Articles of Association of the Registrant, to be in effect upon completion of the offering.
4.1*		Form of the Registrant’s common share certificate.
4.2		Amended and Restated Investors’ Rights Agreement by and between the Registrant and certain of its shareholders dated May 17, 2018.
4.3‡		Second Amendment to Credit Agreement by and between the Registrant, certain of its subsidiaries and Madryn Health Partners, LP dated August 24, 2017, which amended and restated the Credit Agreement effective as of June 15, 2018.
4.4		Security Agreement by and between ELSA, certain of its subsidiaries and Madryn Health Partners, LP dated August 24, 2017.
4.5		Form of Promissory Note by and between the Registrant and former holders of Class Z preferred shares of the Registrant.
4.6		First Amendment to Note and Warrant Purchase Agreement by and between the Registrant and CPH TU, LP, dated December 8, 2015.
4.7		Second Amendment to Note and Warrant Purchase Agreement by and between the Registrant and CPH TU, LP, dated September 14, 2016.
5.1*		Legal opinion of Conyers, Dill & Pearman.
10.1		Form of Indemnification Agreement between the Registrant and each of its directors and executive officers.
10.2+		2015 Equity Incentive Plan, as adopted December 10, 2015, and the forms of equity agreements thereunder.
10.3*+		2018 Equity Incentive Plan and the forms of equity agreements thereunder.
10.4*+		2018 Employee Share Purchase Plan.
10.5+		Consultancy Agreement by and between the Registrant and Salvador Dada Santos, dated July 1, 2016.
10.6+		Employment Agreement by and between Registrant and Juan Jose Chacon Quiros, dated July 1, 2016.
10.7+		Employment Agreement by and between ELSA and Salvador Dada Santos, dated July 1, 2016.
10.8+		Employment Agreement by and between RD&S Produtos para Saude Ltda., and Eddie De Oliveira, dated January 28, 2016.
10.9		Development, Supply & License Agreement by and between ELSA and AorTech International plc, dated December 13, 2011.
10.10		OEM/PLM and Supply Agreement by and between ELSA and Black Tie Medical, Inc., dba Tulip Medical Products, dated July 31, 2016.
10.11		Asset Purchase Agreement by and among the Registrant, JAMM Technologies, Inc., and Magna Equities I, LLC, dated November 6, 2015.

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10.12‡		Supply Agreement by and between Establishment Biotech, S.A. and NuSil Technology LLC, dated July 14, 2009.
10.13		Exclusive Distribution Agreement by and between Registrant, Puregraft LLC and its parent, Bimini Technologies, LLC, dated September 7, 2016.
10.14		Design, Architecture & Engineering, and Build-Out Construction Management Agreement by and between ELSA and Zona Franca Coyol, S.A., dated February 11, 2016.
10.15		Lease Agreement by and between ELSA and Zona Franca Coyol, S.A., dated August 7, 2015.
10.16		Lease Agreement by and between ELSA and Zona Franca Coyol, S.A., dated November 1, 2009, as amended on October 22, 2010, September 24, 2012 and August 7, 2015.
10.17		Commercial Partnership Agreement by and between ELSA and Crisalix, S.A., dated May 15, 2016.
10.18		Joint Invention Assignment Agreement by and between ELSA and Randolph Geissler, dated April 13, 2016.
10.19		Manufacturing and Supply Agreement by and between ELSA and Apollo Endosurgery, Inc., dated December 5, 2014.
10.20		Supply Agreement by and between ELSA and The Hospital Group Healthcare Ltd dated March 1, 2014.
21.1		List of Subsidiaries of the Registrant.
23.1		Consent of Marcum LLP, Independent Registered Public Accounting Firm.
23.2*		Consent of Conyers, Dill & Pearman (included in Exhibit 5.1).
24.1		Power of Attorney (included in page II-5 of this Registration Statement).


*	To be filed by amendment.


+	Indicates management contract or compensatory plan or arrangement.


‡	Portions omitted, or to be omitted, pursuant to a request for confidential treatment.

(b) Financial Statement Schedules.

All financial statement schedules are omitted because the information called for is not required or is shown either in the consolidated financial statements or in the notes thereto.

ITEM 17. UNDERTAKINGS.

The undersigned Registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers, and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant in the successful defense of any action, suit, or proceeding) is asserted by such director, officer, or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

The undersigned Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

II-4

Table of Contents

(2) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-5

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in San Jos é , Costa Rica on this 21st day of June, 2018.



	ESTABLISHMENT LABS HOLDINGS INC.

	By:	/s/ Juan Jose Chacon Quiros

	Name:	Juan Jose Chacon Quiros
	Title:	Chief Executive Officer and Director

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Juan Jose Chacon Quiros and Renee Gaeta, and each of them, his or her true and lawful attorney-in-fact and agent, each with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments, including post-effective amendments, to this Registration Statement, and any registration statement relating to the offering covered by this Registration Statement and filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that each of said attorneys-in-fact and agents or their substitute or substitutes may lawfully so or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated.



Signature	Title	Date

/s/ Juan Jose Chacon Quiros	President, Chief Executive Officer and Director (Principal Executive Officer)	June 21, 2018
Juan Jose Chacon Quiros
/s/ Renee Gaeta	Chief Financial Officer (Principal Financial and Accounting Officer)	June 21, 2018
Renee Gaeta
/s/ Nicholas Lewin	Chairman of the Board of Directors	June 21, 2018
Nicholas Lewin
/s/ Dennis Condon	Director	June 21, 2018
Dennis Condon
/s/ Lisa N. Colleran	Director	June 21, 2018
Lisa N. Colleran
/s/ Ed Schutter	Director	June 21, 2018
Ed Schutter
/s/ David Hung	Director	June 21, 2018
David Hung, M.D.
/s/ Allan Weinstein	Director	June 21, 2018
Allan Weinstein

II-6

Exhibit 3.1

TERRITORY OF THE BRITISH VIRGIN ISLANDS

THE BVI BUSINESS COMPANIES ACT

AMENDED AND RESTATED

MEMORANDUM OF ASSOCIATION

AND

ARTICLES OF ASSOCIATION

ESTABLISHMENT LABS HOLDINGS INC.

Incorporated on 9 October 2013

Approved by unanimous resolutions of the Directors on

the 15th day of June, 2018

Filed on the 19 ^th day June, 2018

Establishment Labs Holdings Inc.

Page 1

TERRITORY OF THE BRITISH VIRGIN ISLANDS

BVI BUSINESS COMPANIES ACT

AMENDED AND RESTATED

MEMORANDUM OF ASSOCIATION

ESTABLISHMENT LABS HOLDINGS INC.


1.	NAME

The name of the company is Establishment Labs Holdings Inc. (the “ Company ”).


2.	STATUS

The Company is a company limited by shares.


3.	REGISTERED OFFICE AND REGISTERED AGENT

The first registered office of the Company is OMC Chambers, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands.

The first registered agent of the Company is Overseas Management Company Trust (B.V.I.) Ltd. of OMC Chambers, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands.


4.	CAPACITY AND POWERS

Subject to the BVI Business Companies Act, (the “ Act ”) and any other British Virgin Islands legislation, the Company has, irrespective of corporate benefit:


(a)	full capacity to carry on or undertake any business or activity, do any act or enter into any transaction; and


(b)	for the purposes of subparagraph (a), full rights, powers and privileges.


5.	NUMBER AND CLASSES OF SHARES

The Company is authorized up to issue to a maximum of 109,447,799 shares, divided into the following classes:


(a)	84,050,000 Common Shares with a par value of $1.00 each (the “Common Shares” );

Establishment Labs Holdings Inc.

Page 2


(b)	13,482,782 Class A Ordinary Shares with a par value of US$1.00 each (the “Class A Ordinary Shares ”);


(c)	7,723,848 Class B Ordinary Shares with a par value of US$1.00 each (the “ Class B Ordinary Shares ”);


(d)	96,301 Class C Ordinary Shares with no par value (the “ Class C Ordinary Shares ”);


(e)	1,539,359 Class D Ordinary Shares with no par value (the “ Class D Ordinary Shares ”);


(f)	323,366 Class E Ordinary Shares with no par value (the “ Class E Ordinary Shares ”);


(g)	357,143 Class F Ordinary Shares with no par value (the “ Class F Ordinary Shares ”);


(h)	1,250,000 Class G Ordinary Shares with no par value (the “ Class G Ordinary Shares ”); and


(i)	625,000 Class G-1 Ordinary Shares with no par value (the “ Class G-1 Ordinary Shares ”).


6.	RIGHTS ATTACHING TO SHARES


6.1	Common Shares

Subject to the Articles, the terms of the issue of any Common Shares of the Company confers on the holder:


(a)	the right to one vote at a meeting of the Members or on any Resolution of Members;


(b)	the right to an equal share in any Distribution paid by the Company; and


(c)	the right to an equal share in the distribution of the surplus assets of the Company on a winding up.


6.2	Class A Ordinary Shares

Subject to the Articles, the terms of the issue of any Class A Ordinary Share of the Company confers on the holder:


(a)	the right to one vote at a meeting of the Members or on any Resolution of Members;


(b)	the right to an equal share in any Distribution paid by the Company;


(c)	the right to an equal share in the distribution of the surplus assets of the Company on a winding up; and


(d)	the right to appoint and remove directors in accordance with the Articles.

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6.3	Class B Ordinary Shares

Subject to the Articles, the terms of the issue of any Class B Ordinary Share of the Company confers on the holder:


(a)	the right to one vote at a meeting of the Members or on any Resolution of Members;


(b)	the right to an equal share in any Distribution paid by the Company;


(c)	the right to an equal share in the distribution of the surplus assets of the Company on a winding up; and


(d)	the right to appoint and remove directors in accordance with the Articles.


6.4	Class C Ordinary Shares

Subject to the Articles, the terms of the issue of any Class C Ordinary Share of the Company confers on the holder:


(a)	the right to one vote at a meeting of the Members or on any Resolution of Members provided the holders of Class C Ordinary Shares vote together with the holders of Ordinary Class A Shares and Ordinary Class B Shares and not as a separate class;


(b)	the right to an equal share in any Distribution paid by the Company; and


(c)	the right to an equal share in the distribution of the surplus assets of the Company on a winding up.


6.5	Class D Ordinary Shares

Subject to the Articles, the terms of the issue of any Class D Ordinary Share of the Company confers on the holder:


(a)	the right to one vote at a meeting of the Members or on any Resolution of Members provided the holders of Class D Ordinary Shares vote together with the holders of Class A Ordinary Shares, Class B Ordinary Shares and Class C Ordinary Shares not as a separate class;


(b)	the right to an equal share in any Distribution paid by the Company; and


(c)	the right to an equal share in the distribution of the surplus assets of the Company on a winding up.

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6.6

For so long as any Class D Ordinary shares remain outstanding, in addition to any other vote or consent required in this Memorandum or the Articles or by law, the vote or written consent of the holders of at least a majority of the outstanding Class D Ordinary Shares, voting together as a single class, shall be necessary for effecting or validating the following actions (whether consummated by merger, amendment, issuance of new shares, consideration or otherwise):


(a)	amends the preferences, rights or privileges of the Class D Ordinary Shares;


(b)	pays or declares any dividend or distribution on any company shares


6.7	Class E Ordinary Shares

Subject to the Articles, the terms of the issue of any Class E Ordinary Share of the Company confers on the holder:


(a)	the right to one vote at a meeting of the Members or on any Resolution of Members provided the holders of Class E Ordinary Shares vote together with the holders of Class A Ordinary Shares, Class B Ordinary Shares, Class C Ordinary Shares and Class D Ordinary Shares not as a separate class;


(b)	the right to an equal share in any Distribution paid by the Company; and


(c)	the right to an equal share in the distribution of the surplus assets of the Company on a winding up.


6.8	Class F Ordinary Shares

Subject to the Articles, the terms of the issue of any Class F Ordinary Share of the Company confers on the holder:


(a)	the right to one vote at a meeting of the Members or on any Resolution of Members provided the holders of Class F Ordinary Shares vote together with the holders of Class A Ordinary Shares, Class B Ordinary Shares, Class C Ordinary Shares, Class D Ordinary Shares and Class E Ordinary Shares not as a separate class;


(b)	the right to an equal share in any Distribution paid by the Company; and


(c)	the right to an equal share in the distribution of the surplus assets of the Company on a winding up.


6.9	Class G Ordinary Shares

Subject to the Articles, the terms of the issue of any Class G Ordinary Share of the Company confers on the holder:


(a)	the right to one vote at a meeting of the Members or on any Resolution of Members provided the holders of Class G Ordinary Shares vote together with the holders of

Establishment Labs Holdings Inc.

Page 5

Class A Ordinary Shares, Class B Ordinary Shares, Class C Ordinary Shares, Class D Ordinary Shares, Class E Ordinary Shares and Class F Ordinary Shares not as a separate class;


(b)	the right to an equal share in any Distribution paid by the Company; and


(c)	the right to an equal share in the distribution of the surplus assets of the Company on a winding up.


6.10	Class G-1 Ordinary Shares

Subject to the Articles, the terms of the issue of any Class G-1 Ordinary Share of the Company confers on the holder:


(a)	the right to one vote at a meeting of the Members or on any Resolution of Members provided the holders of Class G-1 Ordinary Shares vote together with the holders of Class A Ordinary Shares, Class B Ordinary Shares, Class C Ordinary Shares, Class D Ordinary Shares, Class E Ordinary Shares, Class F Ordinary Shares and Class G Ordinary Shares not as a separate class;


(b)	the right to an equal share in any Distribution paid by the Company; and


(c)	the right to an equal share in the distribution of the surplus assets of the Company on a winding up.

(d)

In the event of any Deemed Liquidation Event or any liquidation, dissolution or winding up of the Company, either voluntary or involuntary, the holders of the Class G-1 Ordinary Shares shall be entitled to receive, prior and in preference to any distribution of any of the assets of the Company to the holders of the Class A Ordinary Shares, Class B Ordinary Shares, Class C Ordinary Shares, Class D Ordinary Shares, Class E Ordinary Shares, Class F Ordinary Shares and Class G Ordinary Shares by reason of their ownership of such Class G-1 Ordinary Shares, an amount per share for each share of Class G-1 Ordinary Shares equal to the greater of (i) $16.00 plus all declared or accrued but unpaid dividends (if any) on such Class G-1 Ordinary Share and (ii) the amount that a holder of a Class G-1 Ordinary Share would have received had such Class G-1 Ordinary Share been converted into Common Shares pursuant to Article 7 immediately prior to such Deemed Liquidation Event or such liquidation, dissolution or winding up (the “ Class G-1 Liquidation Preference ”). If upon the Deemed Liquidation Event or such liquidation, dissolution or winding up of the Company, the assets of the Company legally available for distribution to the holders of the Class G-1 Ordinary Shares are insufficient to permit the payment to such holders of the full amounts specified herein, then the entire assets of the Company legally available for distribution shall be distributed to the holders of Class G-1 Ordinary Shares. After the payment or setting aside for payment to the holders of Class G-1 Ordinary Shares of the full amounts specified in this Section 6.10(d), the entire remaining assets of the Company legally available for distribution shall be distributed pro rata to holders of the Common Shares, Class A Ordinary Shares, Class B Ordinary Shares, Class C Ordinary Shares, Class D Ordinary Shares, Class E Ordinary Shares, Class F Ordinary Shares and Class G Ordinary Shares in proportion to the number of shares of shares held by them.

Establishment Labs Holdings Inc.

Page 6

(e)

Dividends on the Class G-1 Ordinary Shares shall begin to accrue on at an annual rate of $0.96 per share from the date on which the Company issues such Class G-1 Ordinary Shares and shall be cumulative. The Company shall have no obligation to pay any dividends, except when, as and if declared by the Board of Directors out of any assets at the time legally available therefor or as otherwise specifically provided in this Memorandum. No distribution shall be made with respect to other shares of the Company until all declared or accrued but unpaid dividends on the Class G-1 Ordinary Shares have been paid or set aside for payment to the holders thereof.

(f)

For so long as any Class G-1 Ordinary shares remain outstanding, in addition to any other vote or consent required in this Memorandum or the Articles or by law, the vote or written consent of the holders of at least a majority of the outstanding Class G-1 Ordinary Shares, voting together as a single class, shall be necessary for effecting or validating the following actions (whether consummated by merger, amendment, issuance of new shares, consideration or otherwise):


i.	amends the preferences, rights or privileges of the Class G-1 Ordinary Shares;


ii.	elects to effect an automatic conversion of Ordinary Shares into Common Shares pursuant to Section 7.1(b) ; or


iii.	pays or declares any dividend or distribution on any company shares.


7.	CONVERSION


7.1	Automatic Conversion

Each Ordinary Share shall convert automatically into one Common Share (or, with respect to Class F Ordinary Shares and Class G-1 Ordinary Shares, as such ratio may be adjusted pursuant to Section 7.3) (such ratio, the “ Conversion Ratio ”) upon the earliest of:


(a)	the closing of a firm underwritten public offering of Common Shares with gross proceeds of at least US$35 million; or


(b)	such date and time as is specified by the affirmative written vote or written consent of the holders of at least a majority of the outstanding Class A Ordinary Shares, Class B Ordinary Shares, Class C Ordinary Shares, Class D Ordinary Shares, Class E Ordinary Shares, Class F Ordinary Shares and Class G Ordinary Shares voting as a single class.


7.2	No Fractional Shares

No fractional Common Shares shall be issued upon conversion of Ordinary Shares. In lieu of any fractional shares to which the holder would otherwise be entitled, the Company shall pay cash equal to such fraction multiplied by the then fair market value of a share of the Company’s Common Shares, as determined by the Board of Directors. For such purpose, all shares of the Company’s Ordinary Shares held by each holder of Ordinary Shares shall be aggregated, and any resulting fractional share of Common Shares shall be paid in cash.

Establishment Labs Holdings Inc.

Page 7


7.3	Adjustment for Future Equity Financings

(a)

If the Company issues equity securities in an equity financing that is not the Company’s initial public offering of registered securities under the Securities Act of 1933, as amended (such initial public offering, the “ IPO ”), for a consideration per share (such consideration per share being referred to as the “ Future Equity Financing Price ”) less than $14.00 per share, then the Conversion Ratio for each Class F Ordinary Share (or if the Class F Ordinary Shares have been converted to Common Shares in accordance with Section 7.1(b), each such converted Common Share) shall be equal to the quotient of (a) 14.0 divided by (b) the Future Equity Financing Price multiplied by 0.85 (the “ Class F Price Adjustment ”). The Class F Price Adjustment obligation in this Section 7.3(a) shall terminate immediately upon the closing of the IPO if such IPO consists of the closing of a firm underwritten public offering of Common Shares with gross proceeds of at least US$35 million (a “ Qualifying IPO ”) but otherwise shall continue until conversion occurs pursuant to the terms of this Section 7.3(a) or the conversion right expires in connection with Section 7.3(b).

(b)

If the Company issues equity securities in the IPO for a consideration per share (such consideration per share being referred to as the “ IPO Price ”) less than $15.00 per share, then the Conversion Ratio for each Class F Ordinary Share (or if the Class F Ordinary Shares have been converted to Common Shares in accordance with Section 7.1(b), each such converted Common Share) shall be equal to the quotient of (a) 15.0 divided by (b) the IPO Price multiplied by 0.85 (the “ Class F IPO Price Adjustment ”). The Class F IPO Price Adjustment obligation in this Section 7.3(b) shall terminate immediately upon the closing of any IPO below $15 per share by reason of the automatic conversion set forth herein, or upon the closing of a Qualifying IPO above $15 per share but shall continue for further public offerings if such IPO is not a Qualifying IPO and the shares have not otherwise converted hereunder.

(c)

If the Company issues equity securities in a public offering registered under the U.S. Securities Act of 1933, as amended (a “ Public Offering ”) for a price to the public (the “ Public Offering Price ”) of less than $17.60 per share, then the Conversion Ratio for each Class G-1 Ordinary Share (or if the Class G-1 Ordinary Shares have been converted to Common Shares in accordance with Section 7.1(b), each holder of such converted Common Shares shall be issued additional Common Shares as though such increased Conversion Ratio applied at the time of such conversion) shall be increased (but shall not be decreased hereunder) to an amount equal to the quotient of (a) 17.6 divided by (b) the Public Offering Price multiplied by 0.90 (the “ Class G-1 IPO Price Adjustment ”). The Class G-1 IPO Price Adjustment obligation in this Section 7.3(c) shall terminate immediately upon the closing of (i) any Public Offering with a Public Offering Price below $17.60 per share pursuant to which an adjustment to the Conversion Ratio occurs under this Section 7.3(c), or (ii) a firm-commitment underwritten Public Offering with gross proceeds of at least US$35 million, which may be the Company’s IPO (a “ Qualifying Offering ”), with a Public Offering Price above $17.60 per share but shall continue for further public offerings if the shares have not otherwise converted pursuant to the terms of Section 7.1(a).


(d)	If the Company issues equity securities in an equity financing that is not a Public Offering for a Future Equity Financing Price less than $16.00 per share, then the Conversion Ratio for each Class G-1 Ordinary Share (or if the Class G-1 Ordinary Shares have been converted to Common Shares in accordance with Section 7.1(b), each holder of such converted

Establishment Labs Holdings Inc.

Page 8

Common Shares shall be issued additional Common Shares as though such increased Conversion Ratio applied at the time of such conversion) shall be increased (but shall not be decreased hereunder) to an amount equal to the quotient of (a) 16.0 divided by (b) the Future Equity Financing Price multiplied by 0.90 (the “ Class G-1 Financing Price Adjustment ”). The Class G-1 Financing Price Adjustment shall terminate immediately upon the closing of (i) any equity financing below $16 per share pursuant to which an adjustment to the Conversion Ratio occurs under this Section 7.3(d) or (ii) a Qualifying Offering, but otherwise shall continue until conversion occurs pursuant to the terms of Section 7.1(a).


8.	VARIATION OF CLASS RIGHTS

Subject to the Articles, the rights attached to any class or series of shares (unless otherwise provided by the terms of issue of the shares of that class or series), whether or not the Company is being wound-up, may be varied with the consent in writing of all the holders of the issued shares of that class or series or with the sanction of a resolution passed by a majority of the votes cast at a separate meeting of the holders of the shares of the class or series.


9.	RIGHTS NOT VARIED BY THE ISSUE OF SHARES PARI PASSU

Rights conferred upon the holders of the shares of any class or series issued with preferred or other rights shall not, unless otherwise expressly provided by the terms of issue of the shares of that class or series, be deemed to be varied by the creation or issue of further shares ranking pari passu therewith.


10.	REGISTERED SHARES

The Company shall issue registered shares only, and such shares may be in full or fractional form. The Company is not authorised to issue bearer shares, convert registered shares to bearer shares, or exchange registered shares for bearer shares.


11.	AMENDMENT OF MEMORANDUM AND ARTICLES OF ASSOCIATION

Subject to Clause (a) and the Articles, the Company may amend its Memorandum or Articles by a Resolution of Members or a Resolution of Directors, save that no amendment may be made by a Resolution of Directors:


(a)	to restrict the rights or powers of the Members to amend the Memorandum or Articles;


(b)	to change the percentage of Members required to pass a Resolution of Members to amend the Memorandum or Articles;


(c)	in circumstances where the Memorandum or Articles cannot be amended by the Members;


(d)	to clauses 6 (except where such amendment is for the purposes of setting out the rights of any new classes of shares issued under Clause 5), 9 or this clause 11;


(e)	which, by its terms, materially and adversely affects any holder of Ordinary Shares in a unique or disproportionate manner relative to all holders of the Ordinary Shares, without the prior written consent of each such holder of Ordinary Shares; or

Establishment Labs Holdings Inc.

Page 9


(f)	to any right or protection specifically granted to any Madryn Holder in the Memorandum or Articles, in a manner adverse to such Madryn Holder, without the written consent of such Madryn Holder.


12.	DEFINITIONS

The meanings of words in this Memorandum are as defined in the Articles annexed hereto.

Establishment Labs Holdings Inc.

Page 10

We, OVERSEAS MANAGEMENT COMPANY TRUST (B.V.I.) LTD ., of OMC Chambers, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands, for the purpose of incorporating a BVI Business Company under the laws of the British Virgin Islands hereby sign this Memorandum of Association the 9 ^th day of October, 2013

Incorporator

SGD: Sallr Husein

Authorised Signatory

OVERSEAS MANAGEMENT COMPANY TRUST (B.V.I.) LTD.

Exhibit 3.3

TERRITORY OF THE BRITISH VIRGIN ISLANDS

BVI BUSINESS COMPANIES ACT

AMENDED AND RESTATED

ARTICLES OF ASSOCIATION

ESTABLISHMENT LABS HOLDINGS INC.

(a company limited by shares)

TABLE OF CONTENTS



		36.	Representation of Members
INTERPRETATION		37.	Adjournment of General Meetings
1.	Definitions	38.	Business at Adjourned Meetings
SHARES		39.	Directors Attendance at General Meetings
2.	Power to Issue Shares	DIRECTORS AND OFFICERS
3.	Power of the Company to Purchase its Shares	40.	Election of Directors
4.	Treatment of Purchased, Redeemed or Acquired Shares	41.	Number of Directors
5.	Treasury Shares	42.	Term of Office of Directors
6.	Consideration	43.	Alternate and Reserve Directors
7.	Forfeiture of Shares	44.	Removal of Directors
8.	Share Certificates	45.	Vacancy in the Office of Director
9.	Fractional Shares	46.	Remuneration of Directors
REGISTRATION OF SHARES		47.	Resignation of directors
10.	Register of Members	48.	Directors to Manage Business
11.	Registered Holder Absolute Owner	49.	Committees of Directors
12.	Transfer of Registered Shares	50.	Officers and Agents
13.	Legend	51.	Removal of Officers and Agents
14.	Lock-Up	52.	Duties of Officers
15.	Transmission of Registered Shares	53.	Remuneration of Officers
16.	Protective Provisions	54.	Standard of Care
ALTERATION OF SHARES		55.	Conflicts of Interest
17.	Power to Alter Shares	56.	Indemnification and Exculpation
18.	Restrictions on the Division of Shares	MEETINGS OF THE BOARD OF DIRECTORS
DISTRIBUTIONS		57.	Board Meetings
19.	Distributions	58.	Notice of Board Meetings
20.	Power to Set Aside Profits	59.	Participation in Meetings by Telephone
21.	Unauthorised Distributions	60.	Quorum at Board Meetings
22.	Distributions to Joint Holders of Shares	61.	Board to Continue in the Event of Vacancy
MEETINGS OF MEMBERS		62.	Chairman to Preside
23.	General Meetings	63.	Powers of Sole Director
24.	Location	64.	Proceedings if One Director
25.	Requisitioned General Meetings	CORPORATE RECORDS
26.	Notice	65.	Documents to be Kept
27.	Giving Notice	66.	Form and Use of Seal
28.	Service of Notice	ACCOUNTS
29.	Participating in Meetings by Telephone	67.	Books of Account
30.	Quorum at General Meetings	68.	Form of Records
31.	Chairman to Preside	69.	Financial Statements
32.	Voting on Resolutions	70.	Distribution of Accounts
33.	Power to Demand a Vote on a Poll	AUDITS
34.	Voting by Joint Holders of Shares	71.	Audit
35.	Instrument of Proxy	72.	Appointment of Auditor



73.	Remuneration of Auditor	FUNDAMENTAL CHANGES
74.	Duties of Auditor	78.	Changes
75.	Access to Records	79.	Continuation under Foreign Law
76.	Auditor Entitled to Notice
VOLUNTARY LIQUIDATION
77.	Liquidation

Establishment Labs Holdings Inc. Page 1

INTERPRETATION


1.	Definitions


1.1	In these Articles, the following words and expressions shall, where not inconsistent with the context, have the following meanings, respectively:


Act	BVI Business Companies Act, as from time to time amended or restated;

Affiliate

an individual, firm, corporation, partnership, association, limited liability company, trust or any other entity (collectively, a “ Person ”) shall be deemed an Affiliate of another Person who, directly or indirectly, controls, is controlled by or is under common control with such Person, including, without limitation, any general partner, limited partner, managing member, officer or director of such Person or any venture capital fund now or hereafter existing that is controlled by one or more general partners or managing members of, or shares the same management company with, such Person;


Articles	these Articles of Association as originally registered or as from time to time amended or restated;


Board	the board of directors appointed or elected pursuant to these Articles and acting by Resolution of Directors;


Company	Establishment Labs Holdings Inc.;


Convertible Securities	any evidences of indebtedness, shares or other securities directly or indirectly convertible into or exchangeable for shares of the Company, but excluding Options;


Distribution	(a) the direct or indirect transfer of an asset, other than the Company’s own shares, to or for the benefit of a Member; or

(b) the incurring of a debt to or for the benefit of a Member;

in relation to shares held by a Member and whether by means of the purchase of an asset, the purchase, redemption or other acquisition of shares, a transfer of indebtedness or otherwise, and includes a dividend;


Investors	CPH TU, L.P. and each other person to whom the rights of an Investor are assigned (as permitted hereby);


Investor Directors	three persons designated by the holders of at least a majority of the then outstanding Class B Ordinary Shares held by the Investors (which individuals shall initially be Nicholas Lewin, Edward

Establishment Labs Holdings Inc. Page 2

Shutter and David Hung), for so long as the Investors and their Affiliates continue to hold at least 25% of the total Class B Ordinary Shares, which number is subject to appropriate adjustment for all share splits, dividends, combinations, recapitalizations and the like; provided, however, that in the event that the size of the Board is increased to seven (7) or more directors, the Investors shall have the right to designate a total of three (3) directors;


Key Holder	Medical Device Holdings S.A., Global Silicone Ltd., Premium Group Holdings Ltd., CPH TU, L.P. and Marmoniel LLC, each person to whom the rights of a Key Holder are assigned (as permitted hereby);


Madryn Holders	collectively, Madryn Health Partners, LP and Madryn Health Partners (Cayman Master), LP, and their respective successors and assigns, for as long as they hold Ordinary Shares in the Company;


Member	a person whose name is entered in the register of members as the holder of one or more shares, or fractional shares, in the Company;


Memorandum	the Memorandum of Association of the Company as originally registered or as from time to time amended or restated;


Ordinary Shares	Class A Ordinary Shares, Class B Ordinary Shares, Class C Ordinary Shares, Class D Ordinary Shares, Class E Ordinary Shares, Class F Ordinary Shares, Class G Ordinary Shares and/or Class G-1 Ordinary Shares;


Resolution of Directors	(a) a resolution approved at a duly constituted meeting of directors or of a committee of directors of the Company by the affirmative vote of a simple majority of the directors present who voted and did not abstain; or

(b) a resolution consented to in writing by all of the directors or of all the members of the committee, as the case may be;


Resolution of Members	(a) a resolution approved at a duly constituted meeting of Members by the affirmative vote of a simple majority of the votes of those Members entitled to vote and voting on the resolution; or

(b) a resolution consented to in writing by all of the Members entitled to vote thereon;


Seal	the common seal of the Company;


Secretary	the person appointed to perform any or all of the duties of secretary of the Company and includes any deputy or assistant secretary and any person appointed by the Board to perform any of the duties of the Secretary;

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Shareholder	each holder of Class A Ordinary Shares, Class B Ordinary Shares, Class C Ordinary Shares, Class D Ordinary Shares, Class E Ordinary Shares, Class F Ordinary Shares, Class G Ordinary Shares, Class G-1 Ordinary Shares or Common Shares together with any subsequent investors, or transferees, the Investors and the Key Holders;


Shares	shall mean and include any securities of the Company the holders of which are entitled to vote for members of the Board, including without limitation, all shares of the Company, by whatever name called, now owned or subsequently acquired by a Shareholder, however acquired, whether through share splits, share dividends, reclassifications, recapitalizations, similar events or otherwise; and


Treasury Share	a share of the Company that was previously issued but was repurchased, redeemed or otherwise acquired by the Company and not cancelled.


1.2	In these Articles, where not inconsistent with the context:


(a)	words denoting the plural number include the singular number and vice versa;


(b)	words denoting the masculine gender include the feminine and neuter genders;


(c)	words importing persons include companies, associations or bodies of persons whether corporate or not;


(d)	a reference to voting in relation to shares shall be construed as a reference to voting by Members holding the shares, except that it is the votes allocated to the shares that shall be counted and not the number of Members who actually voted and a reference to shares being present at a meeting shall be given a corresponding construction;


(e)	a reference to money is unless otherwise stated a reference to the currency in which shares of the Company shall be issued;


(f)	the words:-


(i)	"may" shall be construed as permissive; and


(ii)	"shall" shall be construed as imperative; and


(g)	unless otherwise provided herein, words or expressions defined in the Act shall bear the same meaning in these Articles.


1.3	In these Articles, expressions referring to writing or its cognates shall, unless the contrary intention appears, include facsimile, printing, lithography, photography, electronic mail and other modes of representing words in visible form.


1.4	Headings used in these Articles are for convenience only and are not to be used or relied upon in the construction hereof.

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2.	Power to Issue Shares

Subject to the provisions of the Memorandum, the unissued shares of the Company shall be at the disposal of the Board which may, without prejudice to any rights previously conferred on the holders of any existing shares or class or series of shares, offer, allot, grant options over or otherwise dispose of the shares to such persons, at such times and upon such terms and conditions as the Company may by Resolution of Directors determine.


3.	Power of the Company to Purchase its Shares

Subject to these Articles, the Company may by Resolution of Directors purchase, redeem or otherwise acquire and hold its own shares. Sections 60, 61 and 62 of the Act shall not apply to the Company.


4.	Treatment of Purchased, Redeemed or Acquired Shares


4.1	Subject to Article 4.2, a share that the Company purchases, redeems or otherwise acquires may be cancelled or held by the Company as a Treasury Share.


4.2	The Company may only hold a share that has been purchased, redeemed or otherwise acquired as a Treasury Share if the number of shares purchased, redeemed or otherwise acquired, when aggregated with shares of the same class already held by the Company as Treasury Shares, does not exceed 50% of the shares of that class previously issued by the Company, excluding shares that have been cancelled.


5.	Treasury Shares


5.1	Treasury Shares may be transferred by the Company and the provisions of the Act, the Memorandum and these Articles that apply to the issue of shares apply to the transfer of Treasury Shares.


5.2	All the rights and obligations attaching to a Treasury Share are suspended and shall not be exercised by or against the Company while it holds the share as a Treasury Share.


6.	Consideration


6.1	A share may be issued for consideration in any form, including money, a promissory note or other written obligation to contribute money or property, real property, personal property (including goodwill and know-how), services rendered or a contract for future services.


6.2	No share may be issued for a consideration other than money unless the Board passes a resolution stating:


(a)	the amount to be credited for the issue of the share;


(b)	its determination of the reasonable present cash value of the non-money consideration for the issue; and


(c)	that, in its opinion, the present cash value of the non-money consideration for the issue is not less than the amount to be credited for the issue of the share.

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6.3	No share may be issued by the Company that:


(a)	increases the liability of a person to the Company; or


(b)	imposes a new liability on a person to the Company,

unless that person, or an authorised agent of that person, agrees in writing to becoming the holder of the share.


6.4	The consideration for a share with par value shall not be less than the par value of the share.


7.	Forfeiture of Shares


7.1	Where a share is not fully paid for on issue, the Board may, subject to the terms on which the share was issued, at any time serve upon the Member a written notice of call specifying a date for payment to be made.


7.2	The written notice of call shall name a further date not earlier than the expiration of fourteen days from the date of service of the notice on or before which the payment required by the notice is to be made and shall contain a statement that in the event of non-payment at or before the time named in the notice, the share will be liable to be forfeited.


7.3	Where a notice complying with the foregoing provisions has been issued and the requirements of the notice have not been complied with, the Board by Resolution of Directors may, at any time before tender of payment forfeit and cancel the share to which the notice relates and direct that the register of members be updated.


7.4	Upon forfeiture and cancellation pursuant to Article 7.3, the Company shall be under no obligation to refund any moneys to that Member and that Member shall be discharged from any further obligation to the Company as regards the forfeited share.


8.	Share Certificates


8.1	The Company shall not be required to issue certificates in respect of its shares to a Member, but may elect to do so by the determination of any one director or the Secretary in his sole discretion, upon the request and at the expense of the Member.


8.2	If the Company issues share certificates, the certificates shall be signed by at least one director or such other person who may be authorised by Resolution of Directors to sign share certificates, or shall be under the common seal of the Company, with or without the signature of any director, and the signatures and common seal may be facsimiles.

8.3

Any Member receiving a share certificate for registered shares shall indemnify and hold the Company and its directors and officers harmless from any loss or liability which it or they may incur by reason of wrongful or fraudulent use or representation made by any person by virtue of the possession thereof. If a share certificate for registered shares is worn out or lost it may be renewed on production of the worn out certificate or on satisfactory proof of its loss together with such indemnity as may be required by a Resolution of Directors.


9.	Fractional Shares

The Company may issue fractional shares and a fractional share shall have the corresponding fractional rights, obligations and liabilities of a whole share of the same class or series of shares.

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REGISTRATION OF SHARES


10.	Register of Members


10.1	The Board shall cause there to be kept a register of members in which there shall be recorded the name and address of each Member, the number of each class and series of shares held by each Member, the date on which the name of each Member was entered in the register of members and the date upon which any person ceased to be a Member.


10.2	The register of members may be in such form as the Board may approve, but if it is in magnetic, electronic or other data storage form, the Company must be able to produce legible evidence of its contents. Unless the Board otherwise determines, the magnetic, electronic or other data storage form shall be the original register of members.


11.	Registered Holder Absolute Owner


11.1	The entry of the name of a person in the register of members as a holder of a share in the Company is prima facie evidence that legal title in the share vests in that person.


11.2	The Company may treat the holder of a registered share as the only person entitled to:


(a)	exercise any voting rights attaching to the share;


(b)	receive notices;


(c)	receive a Distribution in respect of the share; and


(d)	exercise other rights and powers attaching to the share.


12.	Transfer of Registered Shares


12.1	Registered shares in the Company shall only be transferred by a written instrument of transfer signed by the transferor and containing the name and address of the transferee.


12.2	The instrument of transfer shall also be signed by the transferee if registration as a holder of the share imposes a liability to the Company on the transferee.


12.3	The instrument of transfer shall be sent to the Company for registration.


12.4	Subject to Article 13, the Company shall, on receipt of an instrument of transfer, enter the name and address of the transferee of the share in the register of members unless the Board resolves to refuse or delay the registration of the transfer for reasons that shall be specified in the resolution.

12.5

The Board is permitted to pass a Resolution of Directors refusing or delaying the registration of a transfer where it reasonably determines that it is in the best interest of the Company to do so. Without limiting the generality of the foregoing, the Board may refuse or delay the registration of a transfer of shares if the transferor has failed to pay an amount due in respect of those shares. Notwithstanding anything to the contrary herein, the Board may not prohibit the following “Permitted Transfers” (i) in the case of any Madryn Holder, a transfer to any of their respective affiliates; (ii) with respect to any other Member, a transfer to such Member’s affiliates; (iii) with respect to a Member who is an individual, a transfer to any member of such Member’s family; and (iv) in the case of a Madryn Holder (in addition to clause (i) above) (A) a transfer

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pursuant to a pledge or grant of a security interest, to a bank or other funding source in support of borrowings made by such Madryn Holder from such person, (B) a transfer by any Madryn Holder which is a fund pursuant to a pledge, or grant of a security interest, to its trustee in support of its obligations to its trustee (provided, that in the case of clauses (A) and (B), no pledge or grant of a security interest shall release the transferor Madryn Holder from any of its obligations hereunder), and (C) a transfer made in connection with the Madryn Holder’s pro rata transfer of all or any part of or interest in any loans or other indebtedness owing to any such Madryn Holder under the Credit Agreement (the “ Credit Agreement ”) dated as of August 24, 2017, as amended, by and between the Company, the Guarantors (as defined in the Credit Agreement), the Lenders (as defined in the Credit Agreement) and Madryn Health Partners, LP, a Delaware limited partnership, as the Administrative Agent (as defined in the Credit Agreement) in accordance with the terms thereof


12.6	Where the Board passes a resolution to refuse or delay the registration of a transfer, the Company shall, as soon as practicable, send the transferor and the transferee a notice of the refusal or delay.


12.7	The transfer of a share is effective when the name of the transferee is entered in the register of members and the Company shall not be required to treat a transferee of a share in the Company as a Member until the transferee’s name has been entered in the register of members.


12.8	If the Board is satisfied that an instrument of transfer has been signed but that the instrument has been lost or destroyed, it may resolve:


(a)	to accept such evidence of the transfer of the shares as it considers appropriate; and


(b)	that the transfer of shares be recorded, including by the entry of the transferee’s name in the register of members.


13.	Legend


13.1	Each certificate representing Transfer Shares held by the Key Holders or issued to any permitted transferee in connection with a transfer permitted by these Articles shall be endorsed with the following legend:

THE SALE, PLEDGE, HYPOTHECATION OR TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO, AND IN CERTAIN CASES PROHIBITED BY, THE TERMS AND CONDITIONS OF THE MEMORANDUM OF ASSOCIATION AND ARTICLES OF ASSOCIATION OF THE COMPANY. COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY.


13.2	The Company may instruct its transfer agent to impose transfer restrictions on the shares represented by certificates bearing the legend referred to in these Articles to enforce the provisions of these Articles and the Company and will promptly do so. The legend shall be removed upon the amendment and restatement of these Articles at the request of the holder.

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14.	Lock-Up

14.1

Each Key Holder hereby agrees that it will not, without the prior written consent of the managing underwriter, during the period commencing on the date of the final prospectus relating to the Company’s IPO and ending on the date specified by the Company and the managing underwriter (such period not to exceed l80 days), or such other period as may be requested by the Company or an underwriter to accommodate regulatory restrictions on (1) the publication or other distribution of research reports and (2) analyst recommendations and opinions, (including, but not limited to, the restrictions contained in FINRA Rule 2711(f)(4) or NYSE Rule 472(f)(4), or any successor provisions or amendments thereto) (a) lend, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any Capital Shares held immediately prior to the effectiveness of the registration statement for the IPO or (b) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Capital Shares, whether any such transaction described in (a) or (b) above is to be settled by delivery of Capital Shares or other securities, in cash or otherwise. The foregoing provisions of this Article shall not apply to the sale of any shares to an underwriter pursuant to an underwriting agreement, and shall only be applicable to the Key Holders if all officers, directors and holders of more than one percent (1%) of the outstanding Ordinary Shares enter into similar agreements. The underwriters in connection with the IPO are intended third‑party beneficiaries of this Article and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. Each Key Holder further agrees to execute such agreements as may be reasonably requested by the underwriters in the IPO that are consistent with this Article or that are necessary to give further effect thereto.


14.2	The Company may impose stop-transfer instructions with respect to the Capital Shares of each Key Holder (and transferees and assignees thereof) until the end of such restricted period.


15.	Transmission of Registered Shares


15.1	The executor or administrator of the estate of a deceased Member, the guardian of an incompetent Member, the liquidator of an insolvent Member or the trustee of a bankrupt Member shall be the only person recognised by the Company as having any title to the Member’s share.

15.2

Any person becoming entitled by operation of law or otherwise to a share in consequence of the death, incompetence or bankruptcy of any Member may be registered as a Member upon such evidence being produced as may reasonably be required by the Board. An application by any such person to be registered as a Member shall for all purposes be deemed to be a transfer of the share of the deceased, incompetent or bankrupt Member and the Board shall treat it as such.


15.3	Any person who has become entitled to a share or shares in consequence of the death, incompetence or bankruptcy of any Member may, instead of being registered himself, request in writing that some person to be named by him be registered as the transferee of such share and such request shall likewise be treated as if it were a transfer.


16.	Protective Provisions

16.1

Each of the following events shall be considered a “Deemed Liquidation Event” unless the holders of at least a majority of the Ordinary Shares elect otherwise: (a) a merger or consolidation in which the Company or Establishment Labs S.A., a Costa Rican company (the “Operating Company”), is a constituent party or (2) a subsidiary of the Company is a constituent party and the Company or the Operating Company issues shares of its capital stock pursuant to such merger or consolidation, except any such merger or consolidation

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involving the Company, the Operating Company or a subsidiary thereof in which the shares of the Company or the Operating Company outstanding immediately prior to such merger or consolidation continue to represent, or are converted into or exchanged for shares that represent, immediately following such merger or consolidation, at least a majority, by voting power, of the shares of (1) the surviving or resulting company; or (2) if the surviving or resulting company is a wholly owned subsidiary of another company immediately following such merger or consolidation, the parent company of such company or resulting company; or (b) the sale, lease, transfer, exclusive license or other disposition, in a single transaction or series of related transactions, by the Company or any subsidiary of the Company of all or substantially all the assets of the Company and its subsidiaries taken as a whole, or the sale or disposition (whether by merger, consolidation or otherwise) of one or more subsidiaries of the Company if substantially all of the assets of the Company and its subsidiaries taken as a whole are held by such subsidiary or subsidiaries, except where such sale, lease, transfer, exclusive license or other disposition is to a wholly owned subsidiary of the Company.

16.2

At any time when the Investors and their Affiliates continue to hold at least 25% of the Class B Ordinary Shares (subject to appropriate adjustment in the event of any share dividend, share split, combination or other similar recapitalization with respect to the Class B Ordinary Shares), the Company shall not, either directly or indirectly by amendment, merger, consolidation or otherwise, do any of the following without (in addition to any other vote required by law, or otherwise by the Memorandum and these Articles), the written consent of the holders of at least a majority of the then-outstanding Shares held by the Investors, given in writing or by vote at a meeting; consenting or voting (as the case may be) separately as a class, and any such act or transaction entered into without such consent or vote shall be null and void ab initio, and of no force or effect:


(a)	liquidate, dissolve or wind-up the business and affairs of the Company, effect any merger or consolidation or any other Deemed Liquidation Event, or consent to any of the foregoing;


(b)	amend, alter or repeal any provision of the Memorandum and these Articles, the;

(c)

create, or authorize the creation of, or issue or obligate itself to issue shares of, any additional class or series of shares unless the same ranks junior to the Class G-1 Ordinary Shares, Class G Ordinary Shares, Class F Ordinary Shares, Class E Ordinary Shares, Class D Ordinary Shares, Class C Ordinary Shares, Class B Ordinary Shares and the Class A Ordinary Shares of the Company (with respect to the distribution of assets on the liquidation, dissolution or winding up of the Company, the payment of dividends and rights of redemption, or increase the authorized number of Ordinary Shares);

(d)

(e)

create, or hold shares in, any subsidiary that is not wholly owned (either directly or through one or more other subsidiaries) by the Company, or sell, transfer or otherwise dispose of any shares of any direct or indirect subsidiary of the Company, or permit any direct or indirect subsidiary to sell, lease, transfer, exclusively license or otherwise dispose (in a single transaction or series of related transactions) of all or substantially all of the assets of such subsidiary;


(f)	encumber or grant a security interest in any of the Company’s property (tangible or intangible) or business;

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(g)	grant an exclusive license for, or create a negative pledge for, all or substantially all of the Company’s intellectual property assets;


(h)	authorize a non pro rata Distribution;


(i)	increase or decrease the authorized number of directors constituting the Board; or


(j)	permit any subsidiary to do any of the foregoing.

ALTERATION OF SHARES


17.	Power to Alter Shares


17.1	The Company may amend the Memorandum to increase or reduce the maximum number of shares that the Company is authorised to issue, or to authorise the Company to issue an unlimited number of shares.


17.2	Subject to the Memorandum and these Articles, the Company may:


(a)	divide its shares, including issued shares, into a larger number of shares; or


(b)	combine its shares, including issued shares, into a smaller number of shares;

provided that, where shares are divided or combined, the aggregate par value (if any) of the new shares must be equal to the aggregate par value (if any) of the original shares.


17.3	A division or combination of shares, including issued shares, of a class or series shall be for a larger or smaller number, as the case may be, of shares in the same class or series.


18.	Restrictions on the Division of Shares

The Company shall not divide its shares if it would cause the maximum number of shares that the Company is authorised to issue to be exceeded.

DISTRIBUTIONS


19.	Distributions

19.1

The Board may, by Resolution of Directors, authorise a Distribution by the Company to Members at such time and of such an amount as it thinks fit if it is satisfied, on reasonable grounds, that immediately after the Distribution, the value of the Company’s assets exceeds its liabilities and the Company is able to pay its debts as they fall due. The resolution shall include a statement to that effect.


19.2	Notice of any Distribution that may have been authorised shall be given to each Member entitled to the Distribution in the manner provided in Article 27 and all Distributions unclaimed for three years after having been authorised may be forfeited by Resolution of Directors for the benefit of the Company.


19.3	All Distributions authorized to be made by Resolution of Directors pursuant to Article 19.1 shall be made to the Shareholders pro rata in proportion to their holdings of Shares.

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20.	Power to Set Aside Profits

The Board may, before authorising any Distribution, set aside out of the profits of the Company such sum as it thinks proper as a reserve fund, and may invest the sum so set apart as a reserve fund in such securities as it may select.


21.	Unauthorised Distributions


21.1	If, after a Distribution is authorised and before it is made, the Board ceases to be satisfied on reasonable grounds that immediately after the Distribution the value of the Company’s assets exceeds its liabilities and the Company is able to pay its debts as they fall due, such Distribution is deemed not to have been authorised.


21.2	A Distribution made to a Member at a time when, immediately after the Distribution, the value of the Company’s assets did not exceed its liabilities and the Company was not able to pay its debts as they fell due, is subject to recovery in accordance with the provisions of the Act.


22.	Distributions to Joint Holders of Shares

If two or more persons are registered as joint holders of any shares, any one of such persons may give an effectual receipt for any Distribution payable in respect of such shares.

MEETINGS OF MEMBERS


23.	General Meetings

The Board, by Resolution of Directors, may convene meetings of the Members of the Company at such times and in such manner as the Board considers necessary or desirable.


24.	Location

Any meeting of the Members may be held in such place within or outside the British Virgin Islands as the Board considers appropriate.


25.	Requisitioned General Meetings

The Board shall call a meeting of the Members if requested in writing to do so by Members entitled to exercise at least thirty percent of the voting rights in respect of the matter for which the meeting is being requested.


26.	Notice


26.1	The Board shall give not less than seven days’ notice of meetings of Members to those persons whose names, on the date the notice is given, appear as Members in the register of members of the Company and are entitled to vote at the meeting.


26.2	A meeting of Members held in contravention of the requirement in Article 26.1 is valid if Members holding a ninety percent majority of the total voting rights on all the matters to be considered at the meeting have waived notice of the meeting and, for this purpose, the presence of a Member at the meeting shall be deemed to constitute waiver on his part.


26.3	The inadvertent failure of the Board to give notice of a meeting to a Member, or the fact that a Member has not received notice, does not invalidate the meeting.

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27.	Giving Notice


27.1	A notice may be given by the Company to any Member either by delivering it to such Member in person or by sending it to such Member's address in the register of members or to such other address given for the purpose. Notice may be sent by mail, courier service, cable, telex, telecopier, facsimile or other mode of representing words in a legible form.


27.2	Any notice required to be given to a Member shall, with respect to any shares held jointly by two or more persons, be given to whichever of such persons is named first in the register of members and notice so given shall be sufficient notice to all the holders of such shares.


28.	Service of Notice

Any notice shall be deemed to have been served at the time when the same would be delivered in the ordinary course of transmission and, in proving such service, it shall be sufficient to prove that the notice was properly addressed and prepaid, if posted, and the time when it was posted, delivered to the courier or to the cable company or transmitted by e-mail, telex, facsimile or other method as the case may be.


29.	Participating in Meetings by Telephone

A Member shall be deemed to be present at a meeting of Members if he participates by telephone or other electronic means and all Members participating in the meeting are able to hear each other.


30.	Quorum at General Meetings


30.1	A meeting of Members is properly constituted if at the commencement of the meeting there are present in person or by proxy not less than fifty percent of the votes of the shares or class or series of shares entitled to vote on Resolutions of Members to be considered at the meeting.

30.2

If within two hours from the time appointed for the meeting a quorum is not present, the meeting, if convened upon the requisition of Members, shall be dissolved; in any other case it shall stand adjourned to the next business day at the same time and place or to such other time and place as the Board may determine, and if at the adjourned meeting there are present within one hour from the time appointed for the meeting in person or by proxy not less than one third of the votes of the shares or each class or series of shares entitled to vote on the resolutions to be considered by the meeting, those present shall constitute a quorum but otherwise the meeting shall be dissolved.


30.3	If a quorum is present, notwithstanding the fact that such quorum may be represented by only one person then such person may resolve any matter and a certificate signed by such person accompanied where such person be a proxy by a copy of the proxy form shall constitute a valid Resolution of Members.


31.	Chairman to Preside

At every meeting of Members, the chairman of the Board shall preside as chairman of the meeting. If there is no chairman of the Board or if the chairman of the Board is not present at the meeting, the Members present shall choose one of their number to be the chairman. If the Members are unable to choose a chairman for any reason, then the person representing the greatest number of voting shares present in person or by proxy at the meeting shall preside as chairman.

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32.	Voting on Resolutions

At any meeting of the Members the chairman shall be responsible for deciding in such manner as he shall consider appropriate whether any resolution has been carried or not and the result of his decision shall be announced to the meeting and recorded in the minutes thereof.


33.	Power to Demand a Vote on a Poll

33.1

At any meeting of Members a resolution put to the vote of the meeting shall, in the first instance, be voted upon by a show of hands and, subject to any rights or restrictions for the time being lawfully attached to any class of shares and subject to the provisions of these Articles, every Member present in person and every person holding a valid proxy at such meeting shall be entitled to one vote and shall cast such vote by raising his hand or speaking its vote if present via telephone or other electronic means.

33.2

At any general meeting a resolution put to the vote of the meeting shall, in the first instance, be voted upon by a show of hands and, subject to any rights or restrictions for the time being lawfully attached to any class of shares and subject to the provisions of these Articles, every Member present in person and every person holding a valid proxy at such meeting shall be entitled to one vote and shall cast such vote by raising his hand or speaking its vote if present via telephone or other electronic means. If the chairman shall have any doubt as to the outcome of any resolution put to the vote, he shall cause a poll to be taken of all votes cast upon such resolution, but if the chairman shall fail to take a poll then any Member present in person or by proxy who disputes the announcement by the chairman of the result of any vote may immediately following such announcement demand that a poll be taken and the chairman shall thereupon cause a poll to be taken. If a poll is taken at any meeting, the result thereof shall be duly recorded in the minutes of that meeting by the chairman.


34.	Voting by Joint Holders of Shares

The following shall apply where shares are jointly owned: (a) if two or more persons hold shares jointly each of them may be present in person or by proxy at a meeting of Members and may speak as a Member; (b) if only one of the joint owners is present in person or by proxy he may vote on behalf of all of them; and (c) if two or more of the joint owners are present in person or by proxy they must vote as one.


35.	Instrument of Proxy


35.1	A Member may be represented at a meeting of Members by a proxy (who need not be a Member) who may speak and vote on behalf of the Member.


35.2	An instrument appointing a proxy shall be in such form as the Board may from time to time determine or such other form as the chairman of the meeting shall accept as properly evidencing the wishes of the Member appointing the proxy.


35.3	The chairman of any meeting at which a vote is cast by proxy or on behalf of any person other than an individual may call for a notarially certified copy of such proxy or authority which shall be produced within seven days of being so requested or the votes cast by such proxy or on behalf of such person shall be disregarded.


35.4	The instrument appointing a proxy shall be produced at the place appointed for the meeting before the time for holding the meeting at which the person named in such instrument proposes to vote.

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36.	Representation of Members

36.1

Any person other than an individual which is a Member may by resolution in writing (certified or signed by a duly authorised person) of its directors or other governing body authorise such person as it thinks fit to act as its representative (in this Article, “ Representative ”) at any meeting of the Members or at the meeting of the Members of any class or series of shares and the Representative shall be entitled to exercise the same powers on behalf of the Member which he represents as that Member could exercise if it were an individual.

36.2

The right of a Representative shall be determined by the law of the jurisdiction where, and by the documents by which, the Member is constituted or derives its existence. In case of doubt, the Board may in good faith seek legal advice from any qualified person and unless and until a court of competent jurisdiction shall otherwise rule, the Board may rely and act upon such advice without incurring any liability to any Member.


37.	Adjournment of General Meetings

The chairman may, with the consent of the meeting, adjourn any meeting from time to time, and from place to place.


38.	Business at Adjourned Meetings

No business shall be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place.


39.	Directors Attendance at General Meetings

Directors of the Company may attend and speak at any meeting of Members of the Company and at any separate meeting of the holders of any class or series of shares in the Company.

DIRECTORS AND OFFICERS


40.	Election of Directors


40.1	The first registered agent of the Company shall, within six months of the date of incorporation of the Company, appoint one or more persons as the first director or directors of the Company. Thereafter, the directors shall be elected by a Resolution of Directors or a Resolution of Members.


40.2	No person shall be appointed as a director or nominated as a reserve director unless he has consented in writing to act as a director or to be nominated as a reserve director.


40.3	A director shall not require a share qualification, and may be an individual or a company.


40.4	Any director which is a body corporate may appoint any person its duly authorised representative for the purpose of representing it at Board meetings or with respect to unanimous written consents.


41.	Number of Directors


41.1	Each Shareholder will vote, or cause to be voted, all Shares owned by such Shareholder, or over which such Shareholder has voting control, from time to time and at all times, in whatever manner as shall be necessary to ensure that the size of the Board shall be set and remain at seven.

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41.2

Each Shareholder will vote, or cause to be voted, all Shares owned by such Shareholder, or over which such Shareholder has voting control, from time to time and at all times, in whatever manner as shall be necessary to ensure that at each annual or special meeting of shareholders at which an election of directors is held or pursuant to any written consent of the shareholders, the following persons shall be elected to the Board: (a) the Investor Directors, for so long as the Investors and their Affiliates continue to hold at least 25% of the Class B Ordinary Shares, which number is subject to appropriate adjustment for all share splits, dividends, combinations, recapitalizations and the like and (b) four (4) persons designated by the holders of at least 75% of the then outstanding Class A Ordinary Shares, which individual shall initially be Dennis Condon, Lisa Colleran, Juan José Chacón Quirós and Allan Weinstein. To the extent that any of paragraphs (a) through (b) shall not be applicable, any member of the Board who would otherwise have been designated in accordance with the terms thereof shall instead be voted upon by all the shareholders of the Company entitled to vote thereon in accordance with, and pursuant to, the Company’s governance documents.


41.3	In the absence of any designation from the Persons or groups with the right to designate a director as specified above, the director previously designated by them and then serving shall be reelected if still eligible to serve as provided herein.

41.4

Each Shareholder will vote, or cause to be voted, all Shares owned by such Shareholder, or over which such Shareholder has voting control, from time to time and at all times, in whatever manner as shall be necessary to ensure that: (a) no director elected pursuant may be removed from office other than for cause unless (i) such removal is directed or approved by the affirmative vote of the Person(s), or of the holders of at least a majority of the shares, entitled to designate that director or (ii) the Person(s) originally entitled to designate or approve such director is no longer so entitled to designate or approve such director; (b) any vacancies created by the resignation, removal or death of a director elected shall be filled pursuant to the above provisions; and (c) upon the request of any party entitled to designate a director to remove such director, such director shall be removed.


41.5	All Shareholders will execute any written consents required to perform the obligations of these Articles, and the Company agrees at the request of any party entitled to designate directors to call a special meeting of shareholders for the purpose of electing directors.


41.6	No Shareholder, nor any Affiliate of any Shareholder, shall have any liability as a result of designating a person for election as a director for any act or omission by such designated person in his or her capacity as a director of the Company, nor shall any Shareholder have any liability as a result of voting for any such designee in accordance with the provisions of these Articles.


41.7	Each committee of the Board shall include at least one (1) of the Investor Directors.

41.8

To the extent that the Company has any subsidiaries, including the Operating Company (as defined below), the Company shall cause the Board or managers of all subsidiaries of the Company to be identical to the Board of the Company. The four persons designated by the holders of at least 75% of the Class A Ordinary Shares may be removed with or without cause by the same majority (75%) of the Class A Ordinary Shares. The Investor Directors may be removed with or without cause by the Investors and their Affiliates holding at least 25% of the Class B Ordinary Shares.


42.	Term of Office of Directors

Each director shall hold office for the term, if any, as may be specified in the resolution appointing him or until his earlier death, resignation or removal.

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43.	Alternate and Reserve Directors


43.1	A director may at any time appoint any person (including another director) to be his alternate director and may at any time terminate such appointment. An appointment and a termination of appointment shall be by notice in writing signed by the director and deposited at the registered office or delivered at a meeting of the Board.


43.2	The appointment of an alternate director shall terminate on the happening of any event which, if he were a director, would cause him to vacate such office or if his appointor ceases for any reason to be a director.

43.3

An alternate director has the same rights as the appointing director in relation to any directors’ meeting and any written resolution circulated for written consent, save that he may not himself appoint an alternate director or a proxy. Any exercise by the alternate director of the appointing director’s powers in relation to the taking of decisions by the directors is as effective as if the powers were exercised by the appointing director.


43.4	If an alternate director is himself a director or attends a meeting of the Board as the alternate director of more than one director, his voting rights shall be cumulative.


43.5	Unless the Board determines otherwise, an alternate director may also represent his appointor at meetings of any committee of the directors on which his appointor serves; and this Article shall apply equally to such committee meetings as to meetings of the Board.


43.6	Where the Company has only one Member who is an individual and that Member is also the sole director, the sole member/director may, by instrument in writing, nominate a person who is not disqualified from being a director under the Act as a reserve director in the event of his death.


43.7	The nomination of a person as a reserve director ceases to have effect if: (a) before the death of the sole Member/director who nominated him he resigns as reserve director, or the sole Member/director revokes the nomination in writing, or (b) the sole Member/director who nominated him ceases to be the sole Member/director for any reason other than his death.


44.	Removal of Directors


44.1	A director may be removed from office, with or without cause:


(a)	by a Resolution of Members at a meeting of the Members called for the purpose of removing the director or for purposes including the removal of the director;


(b)	by a Resolution of Members consented to in writing by all of the Members entitled to vote thereon; or


(c)	by a Resolution of the Members entitled to appoint such director in accordance with these Articles.


44.2	Notice of a meeting called under Article 44.1(a) shall state that the purpose of the meeting is, or the purposes of the meeting include, the removal of a director.


45.	Vacancy in the Office of Director


45.1	Notwithstanding Article 40, the Board may appoint one or more directors to fill a vacancy on the Board.

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45.2	For the purposes of this Article, there is a vacancy on the Board if a director dies or otherwise ceases to hold office as a director prior to the expiration of his term of office or there is otherwise a vacancy in the number of directors as fixed pursuant to Article 41.


45.3	The term of any appointment under this Article may not exceed the term that remained when the person who has ceased to be a director left or otherwise ceased to hold office.


46.	Remuneration of Directors

With the prior or subsequent approval by a Resolution of Members, the Board may, by a Resolution of Directors, fix the emoluments of directors with respect to services to be rendered in any capacity to the Company.


47.	Resignation of directors

A director may resign his office by giving written notice of his resignation to the Company and the resignation shall have effect from the date the notice is received by the Company or from such later date as may be specified in the notice.


48.	Directors to Manage Business


48.1	The business and affairs of the Company shall be managed by, or under the direction or supervision of, the Board.


48.2	The Board has all the powers necessary for managing, and for directing and supervising, the business and affairs of the Company.

48.3

The Board may authorise the payment of all expenses incurred preliminary to and in connection with the formation and registration of the Company and may exercise all such powers of the Company as are not by the Act or by the Memorandum or these Articles required to be exercised by the Members of the Company, subject to any delegation of such powers as may be authorised by these Articles and to such requirements as may be prescribed by a Resolution of Members; but no requirement made by a Resolution of Members shall prevail if it is inconsistent with these Articles nor shall such requirement invalidate any prior act of the Board which would have been valid if such requirement had not been made.


48.4	Subject to the provisions of the Act, all cheques, promissory notes, draft, bills of exchange and other negotiable instruments and all receipts for moneys paid to the Company, shall be signed, drawn, accepted, endorsed or otherwise executed, as the case may be, in such manner as shall from time to time be determined by Resolution of Directors.


49.	Committees of Directors


49.1	The Board may, by a Resolution of Directors, designate one or more committees of directors, each consisting of one or more directors.


49.2	Each committee of directors has such powers and authorities of the Board, including the power and authority to affix the Seal, as are set forth in these Articles or the Resolution of Directors establishing the committee, except that the Board has no power to delegate the following powers to a committee of directors:


(a)	to amend the Memorandum or these Articles;

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(b)	to designate committees of directors;


(c)	to delegate powers to a committee of directors;


(d)	to appoint or remove directors;


(e)	to appoint or remove an agent;


(f)	to approve a plan of merger, consolidation or arrangement;


(g)	to make a declaration of solvency or approve a liquidation plan; or


(h)	to make a determination that the Company will, immediately after a proposed Distribution, meet the solvency test set out in the Act.


49.3	A committee of directors, where authorised by the Board, may appoint a sub-committee.


49.4	The meetings and proceedings of each committee of directors consisting of two or more directors shall be governed mutatis mutandis by the provisions of these Articles regulating the proceedings of directors so far as the same are not superseded by any provisions in the resolution establishing the committee.


50.	Officers and Agents

50.1

The Board may, by a Resolution of Directors, appoint any person, including a person who is a director, to be an officer or agent of the Company. Such officers may consist of a chairman of the Board, a vice chairman of the Board, a president and one or more vice presidents, secretaries and treasurers and such other officers as may from time to time be deemed desirable. Any number of offices may be held by the same person.


50.2	Each officer or agent has such powers and authorities of the Board, including the power and authority to affix the Seal, as are set forth in these Articles or Resolution of Directors appointing the officer or agent, except that no officer or agent has any power or authority with respect to the following:


(a)	to amend the Memorandum or these Articles;


(b)	to change the registered office or agent;


(c)	to designate committees of directors;


(d)	to delegate powers to a committee of directors;


(e)	to appoint or remove directors;


(f)	to appoint or remove an agent;


(g)	to fix emoluments of directors;


(h)	to approve a plan of merger, consolidation or arrangement;


(i)	to make a declaration of solvency or approve a liquidation plan;

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(j)	to make a determination that the Company will, immediately after a proposed distribution, meet the solvency test set out in the Act; or


(k)	to authorise the Company to continue as a company incorporated under the laws of a jurisdiction outside the British Virgin Islands.


51.	Removal of Officers and Agents

The officers and agents of the Company shall hold office until their successors are duly elected and qualified, but any officer or agent elected or appointed by the Board may be removed at any time, with or without cause, by Resolution of Directors. Any vacancy occurring in any office of the Company may be filled by Resolution of Directors.


52.	Duties of Officers

In the absence of any specific allocation of duties it shall be the responsibility of the chairman of the Board to preside at meetings of directors and Members, the vice chairman to act in the absence of the chairman, the president to manage the day to day affairs of the Company, the vice presidents to act in order of seniority in the absence of the president but otherwise to perform such duties as may be delegated to them by the president, the Secretary to maintain the register of members, register or directors, minute books, records (other than financial records) of the Company, and Seal and to ensure compliance with all procedural requirements imposed on the Company by applicable law, and the treasurer to be responsible for the financial affairs of the Company.


53.	Remuneration of Officers

The emoluments of all officers shall be fixed by Resolution of Directors.


54.	Standard of Care

A director, when exercising powers or performing duties as a director, shall exercise the care, diligence, and skill that a reasonable director would exercise in the same circumstances taking into account, but without limitation, (a) the nature of the Company, (b) the nature of the decision, and (c) the position of the director and the nature of the responsibilities undertaken by him.


55.	Conflicts of Interest


55.1	A director shall, forthwith after becoming aware of the fact that he is interested in a transaction entered into or to be entered into by the Company, disclose the interest to the Board, unless the transaction or proposed transaction (a) is between the director and the Company and (b) is to be entered into in the ordinary course of the Company’s business and on usual terms and conditions.

55.2

A transaction entered into by the Company in respect of which a director is interested is voidable by the Company unless the director complies with Article 55.1 or (a) the material facts of the interest of the director in the transaction are known by the Members entitled to vote at a meeting of Members and the transaction is approved or ratified by a Resolution of Members or (b) the Company received fair value for the transaction.


55.3	For the purposes of this Article, a disclosure is not made to the Board unless it is made or brought to the attention of every director on the Board.

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55.4

A director who is interested in a transaction entered into or to be entered into by the Company may vote on a matter relating to the transaction, attend a meeting of directors at which a matter relating to the transaction arises and be included among the directors present at the meeting for the purposes of a quorum and sign a document on behalf of the Company, or do any other thing in his capacity as director that relates to the transaction.


56.	Indemnification and Exculpation


56.1	Subject to Article 56.2 the Company shall indemnify against all expenses, including legal fees, and against all judgments, fines and amounts paid in settlement and reasonably incurred in connection with legal, administrative or investigative proceedings any person who:


(a)	is or was a party or is threatened to be made a party to any threatened, pending or completed proceedings, whether civil, criminal, administrative or investigative, by reason of the fact that the person is or was a director, an officer or a liquidator of the Company; or


(b)	is or was, at the request of the Company, serving as a director, officer or liquidator of, or in any other capacity is or was acting for, another body corporate or a partnership, joint venture, trust or other enterprise.


56.2	Article 56.1 does not apply to a person referred to in that Paragraph unless the person acted honestly and in good faith and in what he believed to be the best interests of the Company and, in the case of criminal proceedings, the person had no reasonable cause to believe that his conduct was unlawful.


56.3	The decision of the Board as to whether the person acted honestly and in good faith and in what he believed to be the best interests of the Company and as to whether the person had no reasonable cause to believe that his conduct was unlawful is, in the absence of fraud, sufficient for the purposes of these Articles, unless a question of law is involved.


56.4	The termination of any proceedings by any judgment, order, settlement, conviction or the entering of a nolle prosequi does not, by itself, create a presumption that the person did not act honestly and in good faith and with a view to the best interests of the Company or that the person had reasonable cause to believe that his conduct was unlawful.


56.5	If a person referred to in this Article has been successful in defence of any proceedings referred to therein, the person is entitled to be indemnified against all expenses, including legal fees, and against all judgments, fines and amounts paid in settlement and reasonably incurred by the person in connection with the proceedings.

56.6

Expenses, including legal fees, incurred by a Director (or former Director) in defending any legal, administrative or investigative proceedings may be paid by the Company in advance of the final disposition of such proceedings upon receipt of an undertaking by or on behalf of the Director (or former Director, as the case may be) to repay the amount if it shall ultimately be determined that the Director (or former Director, as the case may be) is not entitled to be indemnified by the Company.

56.7

The indemnification and advancement of expenses provided by, or granted under these Articles are not exclusive of any other rights to which the person seeking indemnification or advancement of expenses may be entitled under any agreement, Resolution of Members, resolution of disinterested directors or otherwise, both as to acting in the person’s official capacity and as to acting in another capacity while serving as a Director of the Company.

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56.8

The Company may purchase and maintain insurance in relation to any person who is or was a director, an officer or a liquidator of the Company, or who at the request of the Company is or was serving as a director, an officer or a liquidator of, or in any other capacity is or was acting for, another body corporate or a partnership, joint venture, trust or other enterprise, against any liability asserted against the person and incurred by the person in that capacity, whether or not the Company has or would have had the power to indemnify the person against the liability under Article 56.1.

MEETINGS OF THE BOARD OF DIRECTORS


57.	Board Meetings

The Board or any committee thereof may meet at such times and in such manner and places within or outside the British Virgin Islands as it may determine to be necessary or desirable. Any director or the Secretary of the Company may call a Board meeting.


58.	Notice of Board Meetings

A director shall be given reasonable notice of a Board meeting , but a Board meeting held without reasonable notice having been given to all directors shall be valid if all the directors entitled to vote at the meeting waive notice of the meeting, and for this purpose, the presence of a director at the meeting shall be deemed to constitute waiver on his part (except where a director attends a meeting for the express purpose of objecting to the transaction of business on the grounds that the meeting is not properly called). The inadvertent failure to give notice of a meeting to a director, or the fact that a director has not received the notice, does not invalidate the meeting.


59.	Participation in Meetings by Telephone

A director shall be deemed to be present at a meeting of directors if he participates by telephone or other electronic means and all directors participating in the meeting are able to hear each other.


60.	Quorum at Board Meetings

The quorum necessary for the transaction of business at a meeting of directors shall be two directors.


61.	Board to Continue in the Event of Vacancy

The continuing directors may act notwithstanding any vacancy in their body, save that if their number is reduced below the number fixed by or pursuant to these Articles as the necessary quorum for a Board meeting, the continuing directors or director may act only for the purpose of appointing directors to fill any vacancy that has arisen or summoning a meeting of Members.


62.	Chairman to Preside

At every Board meeting the chairman of the Board shall preside as chairman of the meeting. If there is not a chairman of the Board or if the chairman of the Board is not present at the meeting, the vice chairman of the Board shall preside. If there is no vice chairman of the Board or if the vice chairman of the Board is not present at the meeting, the directors present shall choose one of their number to be chairman of the meeting.

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63.	Powers of Sole Director

If the Company shall have only one director the provisions herein contained for Board meetings shall not apply but such sole director shall have full power to represent and act for the Company in all matters as are not by the Act or the Memorandum or these Articles required to be exercised by the Members of the Company.


64.	Proceedings if One Director

If the Company shall have only one director, in lieu of minutes of a meeting the director shall record in writing and sign a note or memorandum (or adopt a resolution in writing) concerning all matters requiring a Resolution of Directors and such note, memorandum or resolution in writing shall be kept in the minute book. Such a note, memorandum or resolution in writing shall constitute sufficient evidence of such resolution for all purposes.

CORPORATE RECORDS


65.	Documents to be Kept


65.1	The Company shall keep the following documents at the office of its registered agent:


(a)	the Memorandum and these Articles;


(b)	the register of members or a copy of the register of members;


(c)	the register of directors or a copy of the register of directors;


(d)	the register of charges or a copy of the register of charges;


(e)	copies of all notices and other documents filed by the Company in the previous ten years.

65.2

Where the Company keeps a copy of its register of members or register of directors at the office of its registered agent, it shall within 15 days of any change in the register, notify the registered agent, in writing, of the change, and it shall provide the registered agent with a written record of the physical address of the place or places at which the original register of members or the original register of directors is kept.


65.3	Where the place at which the original register of members or the original register of directors is changed, the Company shall provide the registered agent with the physical address of the new location of the records within 14 days of the change of location.


65.4	The Company shall keep the following records at the office of its registered agent or at such other place or places, within or outside the British Virgin Islands, as the Board may determine:


(a)	the minutes of meetings and Resolutions of Members and of classes of Members; and


(b)	the minutes of meetings and Resolutions of Directors and committees of directors.


65.5	Where any of the minutes or resolutions described in the previous paragraph are kept at a place other than at the office of the Company’s registered agent, the Company shall provide the registered agent with a written record of the physical address of the place or places at which the records are kept.

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65.6	Where the place at which any of the records described in Article 65.4 is changed, the Company shall provide the registered agent with the physical address of the new location of the records within 14 days of the change of location.


65.7	The Company’s records shall be kept in written form or either wholly or partly as electronic records.


66.	Form and Use of Seal

The Board shall provide for the safe custody of the Seal. An imprint thereof shall be kept at the office of the registered agent of the Company. The Seal when affixed to any written instrument shall be witnessed by any one director, the Secretary or Assistant Secretary, or by any person or persons so authorised from time to time by Resolution of Directors.

ACCOUNTS


67.	Books of Account

The Company shall keep records and underlying documentation that:


(a)	are sufficient to show and explain the Company’s transactions; and


(b)	will, at any time, enable the financial position of the Company to be determined with reasonable accuracy.


68.	Form of Records


68.1	The records required to be kept by the Company under the Act, the Mutual Legal Assistance (Tax Matters Act), 2003, the Memorandum or these Articles shall be kept in written form or either wholly or partly as electronic records complying with the requirements of the Electronic Transactions Act (British Virgin Islands).


68.2	The records and underlying documentation shall be kept for a period of at least five years from the date of completion of the relevant transaction or the company terminates the business relationship to which the records and underlying documentation relate.


69.	Financial Statements


69.1	If required by a Resolution of Members, the Board shall cause to be made out and served on the Members or laid before a meeting of Members a profit and loss account and balance sheet of the Company for such period and on such recurring basis as the Members think fit.


69.2	The Company's profit and loss account and balance sheet shall be drawn up so as to give respectively a true and fair view of the profit or loss of the Company for that financial period, and a true and fair view of the state of affairs of the Company as at the end of that financial period.


70.	Distribution of Accounts

A copy of such profit and loss account and balance sheet shall be served on every Member in the manner and with similar notice to that prescribed herein for calling a meeting of Members or upon such shorter notice as the Members may agree to accept.

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AUDITS


71.	Audit

The Company may by Resolution of Members call for the accounts to be examined by an auditor.


72.	Appointment of Auditor


72.1	The first auditor shall be appointed by Resolution of Directors; subsequent auditors shall be appointed by a Resolution of Members.


72.2	The auditor may be a Member of the Company but no director or other officer shall be eligible to be an auditor of the Company during his continuance in office.


73.	Remuneration of Auditor

The remuneration of the auditor of the Company:


(a)	in the case of an auditor appointed by the Board, may be fixed by Resolution of Directors; and


(b)	subject to the foregoing, shall be fixed by Resolution of Members or in such manner as the Company may by Resolution of Members determine.


74.	Duties of Auditor

The auditor shall examine each profit and loss account and balance sheet required to be served on every Member of the Company or laid before a meeting of the Members of the Company and shall state in a written report whether or not:


(a)	in its opinion the profit and loss account and balance sheet give a true and fair view respectively of the profit and loss for the period covered by the accounts, and of the state of affairs of the Company at the end of that period; and


(b)	all the information and explanations required by the auditor have been obtained.


75.	Access to Records

Every auditor of the Company shall have right of access at all times to the books of account of the Company, and shall be entitled to require from the directors and officers of the Company such information and explanations as he thinks necessary for the performance of the duties of the auditor.


76.	Auditor Entitled to Notice

The auditor of the Company shall be entitled to receive notice of, and to attend any meetings of Members of the Company at which the Company's profit and loss account and balance sheet are to be presented.

VOLUNTARY LIQUIDATION

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77.	Liquidation

The Company may be liquidated in accordance with the Act only if (a) it has no liabilities; or (b) it is able to pay its debts as they fall due and the value of its assets equals or exceeds its liabilities. The Board shall be permitted to pass a Resolution of Directors for the appointment of an eligible individual as a voluntary liquidator (or two or more eligible individuals as joint voluntary liquidators) of the Company if the Members have, by a Resolution of Members, approved the liquidation plan in accordance with the Act.

FUNDAMENTAL CHANGES


78.	Changes

Notwithstanding section 175 of the Act, the Board may sell, transfer, lease, exchange or otherwise dispose of the assets of the Company without the sale, transfer, lease, exchange or other disposition being authorised by a Resolution of Members.


79.	Continuation under Foreign Law

The Company may by Resolution of Members or by Resolution of Directors continue as a company incorporated under the laws of a jurisdiction outside the British Virgin Islands in the manner provided under those laws.

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We, OVERSEAS MANAGEMENT COMPANY TRUST (B.V.I.) LTD ., of OMC Chambers, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands, for the purpose of incorporating a BVI Business Company under the laws of the British Virgin Islands hereby sign these Articles of Association the 9 ^th day of October, 2013

Incorporator

SGD: Sallr Husein

Authorised Signatory

OVERSEAS MANAGEMENT COMPANY TRUST (B.V.I.) LTD.

Exhibit 4.2

ESTABLISHMENT LABS HOLDINGS INC.

AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

May 17, 2018

TABLE OF CONTENTS



		Page
SECTION 1. DEFINITIONS		1
1.1	Certain Definitions	1
SECTION 2. REGISTRATION RIGHTS		4
2.1	Requested Registration	4
2.2	Company Registration	6
2.3	Registration on Form S-3	8
2.4	Expenses of Registration	8
2.5	Registration Procedures	9
2.6	Indemnification	10
2.7	Information by Holder	11
2.8	Restrictions on Transfer	11
2.9	Rule 144 Reporting	13
2.10	Market Stand-Off Agreement	13
2.11	Delay of Registration	14
2.12	Transfer or Assignment of Registration Rights	14
2.13	Limitations on Subsequent Registration Rights	14
2.14	Termination of Registration Rights	14
SECTION 3. COVENANTS		14
3.1	Basic Financial Information and Inspection Rights	14
3.2	Confidentiality	15
3.3	“Bad Actor” Notice	15
3.4	Board Matters	15
3.5	Termination of Covenants	16
SECTION 4. RIGHT OF FIRST REFUSAL – NEW SECURITIES		16
4.1	Exercise by Significant Holders	16
SECTION 5. MISCELLANEOUS		17
5.1	Amendment	17
5.2	No Effect Upon Lending Relationship	17
5.3	Notices	17
5.4	Governing Law	18
5.5	Successors and Assigns	18
5.6	Entire Agreement	18
5.7	Delays or Omissions	19
5.8	Severability	19
5.9	Titles and Subtitles	19
5.10	Counterparts	19
5.11	Telecopy Execution and Delivery	19
5.12	Jurisdiction; Venue	19
5.13	Further Assurances	19
5.15	Conflict	20
5.16	Attorneys’ Fees	20
5.17	Aggregation of Shares	20

ESTABLISHMENT LABS HOLDINGS INC.

AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

This Amended and Restated Investors’ Rights Agreement (this “ Agreement ”) is dated as of May 17, 2018, and is between Establishment Labs Holdings Inc., a company incorporated under the laws of the British Virgin Islands (the “ Company ”), and the persons and entities listed on Exhibit A (each, an “ Investor ” and collectively, the “ Investors ”). Unless otherwise defined herein, capitalized terms used in this Agreement have the meanings ascribed to them in Section 1.

RECITALS

Certain of the Investors are parties to the Series G Share Purchase Agreement dated as of February 15, 2018 and/or the Class G-1 Share Purchase Agreement of even date herewith, among the Company and the Investors listed on the Schedule of Investors thereto (collectively, the “ Purchase Agreements ”), and it is a condition to the closing of the sale of the Class G-1 Ordinary Shares to the Investors listed on such Schedule of Investors that the Investors and the Company execute and deliver this Agreement.

The Company and certain of the Investors (the “ Existing Investors ”) possess certain rights pursuant to an Amended and Restated Investors’ Rights Agreement dated as of February 15, 2018 (the “ Prior Agreement ”).

The Prior Agreement may be amended, and any provision therein waived, with the consent of the Company and the holders of at least a majority of the outstanding Registrable Securities held by the Investors (as such terms are defined in the Prior Agreement).

The Company and the undersigned Existing Investors as holders of a majority of the outstanding Investors’ Shares (as such term is defined in the Prior Agreement) desire to terminate the Prior Agreement and to accept the rights created pursuant hereto in light of the rights granted to them under the Prior Agreement.

The parties therefore agree as follows:

SECTION 1.

DEFINITIONS

1.1 Certain Definitions. As used in this Agreement, the following terms shall have the meanings set forth below:

(a) “ Bad Actor Disqualification ” means any “bad actor” disqualification described in Rule 506(d)(1)(i) through (viii) under the Securities Act.

(b) “ Class G Ordinary Shares ” shall mean the shares of Class G Ordinary Shares of the Company.

(d) “ Commission ” shall mean the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act.

(e) “ Common Shares ” means the Common Shares of the Company.

(f) “ Convertible Securities ” shall have the meaning set forth in the Company’s amended and restated memorandum and articles of association.

(g) “ Exchange Act ” shall mean the Securities Exchange Act of 1934, as amended, or any similar successor federal statute and the rules and regulations thereunder, all as the same shall be in effect from time to time.

(h) “ Exempted Securities ” shall mean (a) shares of the Company, Options or Convertible Securities issued as a dividend or distribution on shares of the Company, (b) shares of the Company, Options or Convertible Securities issued by reason of a dividend, share split, or split-up, (c) shares of the Company or Options issued to employees or directors of, or consultants or advisors to, the Company or any of its subsidiaries pursuant to a plan, agreement or arrangement approved by the Board, (d) shares of the Company or Convertible Securities actually issued upon the exercise of Options or shares of the Company actually issued upon the conversion or exchange of Convertible Securities, in each case provided such issuance is pursuant to the terms of such Option or Convertible Security, (e) shares of the Company, Options or Convertible Securities issued to banks, equipment lessors or other financial institutions, or to real property lessors, pursuant to a debt financing, equipment leasing or real property leasing transaction approved by the Board and do not exceed an aggregate of 10% shares of the Company (including shares underlying (directly or indirectly) any such Options or Convertible Securities), (f) shares of the Company, Options or Convertible Securities issued to suppliers or third party service providers in connection with the provision of goods or services pursuant to transactions approved by the Board and do not exceed an aggregate of 10% of the shares of the Company (including shares underlying (directly or indirectly) any such Options or Convertible Securities), (g) shares of the Company, Options or Convertible Securities issued pursuant to the acquisition of another corporation by the Company by merger, purchase of substantially all of the assets or other reorganization or to a joint venture agreement, provided that such issuances are approved by the Board and do not exceed an aggregate of 10% of the shares of the Company (including shares underlying (directly or indirectly) any such Options or Convertible Securities), and (h) shares of the Company, Options or Convertible Securities issued to an unaffiliated third party in connection with sponsored research, technology license, development, OEM, marketing or other similar agreements or strategic partnerships, which are in the ordinary course of business of the Company, approved by the Board and do not exceed an aggregate of 10% of the shares of the Company (including shares underlying (directly or indirectly) any such Options or Convertible Securities);

(i) “ Holder ” shall mean any Investor who holds Registrable Securities and any holder of Registrable Securities to whom the registration rights conferred by this Agreement have been duly and validly transferred in accordance with Section 2.12 of this Agreement.

(j) “ Indemnified Party ” shall have the meaning set forth in Section 2.6(b).

(k) “ Indemnifying Party ” shall have the meaning set forth in Section 2.6(b).

(l) “ Initial Closing ” shall mean the date of the initial sale of the Company’s Class G-1 Ordinary Shares pursuant to the Class G-1 Share Purchase Agreement.

(m) “ Initial Public Offering ” shall mean the closing of the Company’s first firm commitment underwritten public offering of the Company’s Common Shares registered under the Securities Act.

(n) “ Initiating Holders ” shall mean any Holder or Holders who in the aggregate hold not less than 20% of the outstanding Registrable Securities.

(o) “ Madryn Holders ” means, collectively, Madryn Health Partners, LP and Madryn Health Partners (Cayman Master), LP, and their respective successors and assigns, for as long as they hold Ordinary Shares in the Company.

(p) “ New Securities ” shall have the meaning set forth in Section 4.1(a).

(q) “ Option ” shall mean rights, options or warrants to subscribe for, purchase or otherwise acquire shares of the Company or Convertible Securities;

(r) “ Ordinary Shares ” means the Ordinary Shares of the Company.

(s) “ Other Selling Shareholders ” shall mean persons other than Holders who, by virtue of agreements with the Company, are entitled to include their Other Shares in certain registrations hereunder.

(t) “ Other Shares ” shall mean Ordinary Shares, other than Registrable Securities (as defined below), with respect to which registration rights have been granted.

(u) “ Purchase Agreements ” shall have the meaning set forth in the Recitals.

(v) “ Registrable Securities ” shall mean (i) Ordinary Shares issued or issuable pursuant to the conversion of the Shares and (ii) any Ordinary Shares issued as a dividend or other distribution with respect to or in exchange for or in replacement of the shares referenced in (i) above; provided , however , that Registrable Securities shall not include any Ordinary Shares described in clause (i) or (ii) above which have previously been registered or which have been sold to the public either pursuant to a registration statement or Rule 144, or, with respect to registration rights under this Agreement, which have been sold in a private transaction in which the transferor’s rights under this Agreement are not validly assigned in accordance with this Agreement.

(w) The terms “ register ,” “ registered ” and “ registration ” shall refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act and applicable rules and regulations thereunder, and the declaration or ordering of the effectiveness of such registration statement.

(x) “ Registration Expenses ” shall mean all expenses incurred in effecting any registration pursuant to this Agreement, including, without limitation, all registration, qualification, and filing fees, printing expenses, escrow fees, fees and disbursements of counsel for the Company and one special counsel for the Holders, blue sky fees and expenses, and expenses of any regular or special audits incident to or required by any such registration, but shall not include Selling Expenses, fees and disbursements of other counsel for the Holders and the compensation of regular employees of the Company, which shall be paid in any event by the Company.

(y) “ Restricted Securities ” shall mean any Registrable Securities required to bear the first legend set forth in Section 2.8(b).

(z) “ Rule 144 ” shall mean Rule 144 as promulgated by the Commission under the Securities Act, as such Rule may be amended from time to time, or any similar successor rule that may be promulgated by the Commission.

(aa) “ Rule 145 ” shall mean Rule 145 as promulgated by the Commission under the Securities Act, as such Rule may be amended from time to time, or any similar successor rule that may be promulgated by the Commission

(bb) “ Securities Act ” shall mean the Securities Act of 1933, as amended, or any similar successor federal statute and the rules and regulations thereunder, all as the same shall be in effect from time to time.

(cc) “ Selling Expenses ” shall mean all underwriting discounts, selling commissions and share transfer taxes applicable to the sale of Registrable Securities and fees and disbursements of counsel for any Holder (other than the fees and disbursements of one special counsel to the Holders included in Registration Expenses).

(dd) “ Shares ” shall mean the Company’s Class A Ordinary Shares, Class B Ordinary Shares, Class C Ordinary Shares, Class D Ordinary Shares, Class E Ordinary Shares, Class F Ordinary Shares, Class G Ordinary Shares and Class G-1 Ordinary Shares.

(ee) “ Significant Holder ” shall have the meaning set forth in Section 3.1.

(ff) “ Transfer ,” “ Transferring ,” “ Transferred ,” or words of similar import, mean and include any sale, assignment, encumbrance, hypothecation, pledge, conveyance in trust, gift, transfer by bequest, devise or descent, or other transfer or disposition of any kind, including but not limited to transfers to receivers, levying creditors, trustees or receivers in bankruptcy proceedings or general assignees for the benefit of creditors, whether voluntary or by operation of law, directly or indirectly.

(gg) “ Withdrawn Registration ” shall mean a forfeited demand registration under Section 2.1 in accordance with the terms and conditions of Section 2.4.

SECTION 2

REGISTRATION RIGHTS

2.1 Requested Registration .

(a) Request for Registration. Subject to the conditions set forth in this Section 2.1, if the Company shall receive from Initiating Holders a written request signed by such Initiating Holders that the Company effect any registration with respect to all or a part of the Registrable Securities (such request shall state the number of shares of Registrable Securities to be disposed of by such Initiating Holders), the Company will:

(i) promptly give written notice of the proposed registration to all other Holders; and

(ii) as soon as practicable, file and use its commercially reasonable efforts to effect such registration (including, without limitation, filing post-effective amendments, appropriate qualifications under applicable blue sky or other state securities laws, and appropriate compliance with the Securities Act) and to permit or facilitate the sale and distribution of all or such portion of such Registrable Securities as are specified in such request, together with all or such portion of the Registrable Securities of

any Holder or Holders joining in such request as are specified in a written request received by the Company within 20 days after such written notice from the Company is mailed or delivered.

(b) Limitations on Requested Registration. The Company shall not be obligated to effect, or to take any action to effect, any such registration pursuant to this Section 2.1:

(i) Prior to the earlier of (A) the five year anniversary of the date of this Agreement or (B) 180 days following the effective date of the first registration statement filed by the Company covering an underwritten offering of any of its securities to the general public (or the subsequent date on which all market stand-off agreements applicable to the offering have terminated);

(ii) If the Initiating Holders, together with the holders of any other securities of the Company entitled to inclusion in such registration statement, propose to sell Registrable Securities and such other securities (if any) at an aggregate offering price, net of underwriter’s discounts and expenses, of less than $5,000,000;

(iii) In any particular jurisdiction in which the Company would be required to execute a general consent to service of process in effecting such registration, qualification, or compliance, unless the Company is already subject to service in such jurisdiction and except as may be required by the Securities Act;

(iv) After the Company has initiated two such registrations pursuant to this Section 2.1 (counting for these purposes only (x) registrations which have been declared or ordered effective and pursuant to which securities have been sold, and (y) Withdrawn Registrations);

(v) During the period starting with the date 60 days prior to the Company’s good faith estimate of the date of filing of, and ending on a date 180 days after the effective date of, a Company-initiated registration (or ending on the subsequent date on which all market stand-off agreements applicable to the offering have terminated); provided that the Company is actively employing in good faith commercially reasonable efforts to cause such registration statement to become effective;

(vi) If the Initiating Holders propose to dispose of shares of Registrable Securities that may be registered on Form S-3 pursuant to a request made under Section 2.3;

(vii) If the Initiating Holders do not request that such offering be firmly underwritten by underwriters selected by the Initiating Holders (subject to the consent of the Company); and

(viii) If the Company and the Initiating Holders are unable to obtain the commitment of the underwriter described in clause (b)(vii) above to firmly underwrite the offer.

(c) Deferral. If (i) in the good faith judgment of the board of directors of the Company, the filing of a registration statement covering the Registrable Securities would be materially detrimental to the Company and the board of directors of the Company concludes, as a result, that it is in the best interests of the Company to defer the filing of such registration statement at such time, and (ii) the Company shall furnish to such Holders a certificate signed by the President or Chief Financial Officer of the Company stating that in the good faith judgment of the board of directors of the Company, it would be materially detrimental to the Company for such registration statement to be filed in the near future and that it is, therefore, in the best interests of the Company to defer the filing of such registration statement, then (in addition to the limitations set forth in Section 2.1(b)(b)(v) above) the Company shall have the right to defer such filing for a period of not more than 90 days after receipt of the request of the Initiating Holders, and, provided further ,

that the Company shall not defer its obligation in this manner more than two times in any twelve-month period.

(d) Other Shares. The registration statement filed pursuant to the request of the Initiating Holders may, subject to the provisions of Section 2.1(e), include Other Shares, and may include securities of the Company being sold for the account of the Company.

(e) Underwriting. The right of any Holder to include all or any portion of its Registrable Securities in a registration pursuant to this Section 2.1 shall be conditioned upon such Holder’s participation in an underwriting and the inclusion of such Holder’s Registrable Securities to the extent provided herein. If the Company shall request inclusion in any registration pursuant to Section 2.1 of securities being sold for its own account, or if other persons shall request inclusion in any registration pursuant to Section 2.1, the Initiating Holders shall, on behalf of all Holders, offer to include such securities in the underwriting and such offer shall be conditioned upon the participation of the Company or such other persons in such underwriting and the inclusion of the Company’s and such person’s other securities of the Company and their acceptance of the further applicable provisions of this Section 2 (including Section 2.10). The Company shall (together with all Holders and other persons proposing to distribute their securities through such underwriting) enter into an underwriting agreement in customary form with the representative of the underwriter or underwriters selected for such underwriting by the Company, which underwriters are reasonably acceptable to a majority-in-interest of the Initiating Holders.

Notwithstanding any other provision of this Section 2.1, if the underwriters advise the Initiating Holders in writing that marketing factors require a limitation on the number of shares to be underwritten, the number of Registrable Securities and Other Shares that may be so included shall be allocated as follows: (i) first, among all Holders requesting to include Registrable Securities in such registration statement based on the pro rata percentage of Registrable Securities held by such Holders, assuming conversion; and (ii) second, to the Company, which the Company may allocate, at its discretion, for its own account, or for the account of other holders or employees of the Company.

If a person who has requested inclusion in such registration as provided above does not agree to the terms of any such underwriting, such person shall be excluded therefrom by written notice from the Company, the underwriter or the Initiating Holders. The securities so excluded shall also be withdrawn from registration. Any Registrable Securities or other securities excluded or withdrawn from such underwriting shall also be withdrawn from such registration. If shares are so withdrawn from the registration and if the number of shares to be included in such registration was previously reduced as a result of marketing factors pursuant to this Section 2.1(e), then the Company shall then offer to all Holders who have retained rights to include securities in the registration the right to include additional Registrable Securities in the registration in an aggregate amount equal to the number of shares so withdrawn, with such shares to be allocated among such Holders requesting additional inclusion, as set forth above.

2.2 Company Registration .

(a) Company Registration. If the Company shall determine to register any of its securities either for its own account or the account of a security holder or holders, other than a registration pursuant to Section 2.1 or 2.3, a registration relating solely to employee benefit plans, a registration relating to the offer and sale of debt securities, a registration relating to a corporate reorganization or other Rule 145

transaction, or a registration on any registration form that does not permit secondary sales, the Company will:

(i) promptly give written notice of the proposed registration to all Holders; and

(ii) use its commercially reasonable efforts to include in such registration (and any related qualification under blue sky laws or other compliance), except as set forth in Section 2.2(b) below, and in any underwriting involved therein, all of such Registrable Securities as are specified in a written request or requests made by any Holder or Holders received by the Company within 10 days after such written notice from the Company is mailed or delivered. Such written request may specify all or a part of a Holder’s Registrable Securities.

(b) Underwriting. If the registration of which the Company gives notice is for a registered public offering involving an underwriting, the Company shall so advise the Holders as a part of the written notice given pursuant to Section 2.2(a)(a)(i). In such event, the right of any Holder to registration pursuant to this Section 2.2 shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with the Company, the Other Selling Shareholders and other holders of securities of the Company with registration rights to participate therein distributing their securities through such underwriting) enter into an underwriting agreement in customary form with the representative of the underwriter or underwriters selected by the Company.

Notwithstanding any other provision of this Section 2.2, if the underwriters advise the Company in writing that marketing factors require a limitation on the number of shares to be underwritten, the underwriters may (subject to the limitations set forth below) limit the number of Registrable Securities to be included in, the registration and underwriting. The Company shall so advise all holders of securities requesting registration, and the number of shares of securities that are entitled to be included in the registration and underwriting shall be allocated, as follows: (i) first, to the Company for securities being sold for its own account, (ii) second, to the Holders requesting to include Registrable Securities in such registration statement based on the pro rata percentage of Registrable Securities held by such Holders, assuming conversion and (iii) third, to the Other Selling Shareholders requesting to include Other Shares in such registration statement based on the pro rata percentage of Other Shares held by such Other Selling Shareholders, assuming conversion. Notwithstanding the foregoing, no such reduction shall reduce the value of the Registrable Securities of the Holders included in such registration below 30% of the total value of securities included in such registration, unless such offering is the Company’s Initial Public Offering and such registration does not include shares of any other selling shareholders (excluding shares registered for the account of the Company), in which event any or all of the Registrable Securities of the Holders may be excluded.

If a person who has requested inclusion in such registration as provided above does not agree to the terms of any such underwriting, such person shall also be excluded therefrom by written notice from the Company or the underwriter. The Registrable Securities or other securities so excluded shall also be withdrawn from such registration. Any Registrable Securities or other securities excluded or withdrawn from such underwriting shall be withdrawn from such registration.

(c) Right to Terminate Registration. The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 2.2 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration.

2.3 Registration on Form S-3 .

(a) Request for Form S‑3 Registration. After its initial public offering, the Company shall use its commercially reasonable efforts to qualify for registration on Form S-3 or any comparable or successor form or forms. After the Company has qualified for the use of Form S-3, in addition to the rights contained in the foregoing provisions of this Section 2 and subject to the conditions set forth in this Section 2.3, if the Company shall receive from a Holder or Holders of Registrable Securities a written request that the Company effect any registration on Form S‑3 or any similar short form registration statement with respect to all or part of the Registrable Securities (such request shall state the number of shares of Registrable Securities to be disposed of and the intended methods of disposition of such shares by such Holder or Holders), the Company will take all such action with respect to such Registrable Securities as required by Section 2.1(a)(i) and 2.1(a)(ii).

(b) Limitations on Form S‑3 Registration. The Company shall not be obligated to effect, or take any action to effect, any such registration pursuant to this Section 2.3:

(i) In the circumstances described in either Sections 2.1(b)(i), 2.1(b)(iii) or 2.1(b)(v);

(ii) If the Holders, together with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable Securities and such other securities (if any) on Form S‑3 at an aggregate price to the public of less than $5,000,000; or

(iii) If, in a given twelve-month period, the Company has effected one such registration in such period.

(d) Underwriting. If the Holders of Registrable Securities requesting registration under this Section 2.3 intend to distribute the Registrable Securities covered by their request by means of an underwriting, the provisions of Section 2.1(e) shall apply to such registration. Notwithstanding anything contained herein to the contrary, registrations effected pursuant to this Section 2.3 shall not be counted as requests for registration or registrations effected pursuant to Section 2.1.

2.4 Expenses of Registration . All Registration Expenses incurred in connection with registrations pursuant to Sections 2.1, 2.2 and 2.3 shall be borne by the Company; provided, however, that the Company shall not be required to pay for any expenses of any registration proceeding begun pursuant to Sections 2.1 and 2.3 if the registration request is subsequently withdrawn at the request of the Holders of a majority of the Registrable Securities to be registered or because a sufficient number of Holders shall have withdrawn so that the minimum offering conditions set forth in Sections 2.1 and 2.3 are no longer satisfied (in which case all participating Holders shall bear such expenses pro rata among each other based on the number of Registrable Securities requested to be so registered), unless the Holders of a majority of the Registrable Securities agree to forfeit their right to a demand registration pursuant to Section 2.1; provided, however, in the event that a withdrawal by the Holders is based upon material adverse information relating to the Company that is different from the information known or available (upon request from the Company or otherwise) to the Holders requesting registration at the time of their request for registration under Section

2.1, such registration shall not be treated as a counted registration for purposes of Section 2.1, even though the Holders do not bear the Registration Expenses for such registration. All Selling Expenses relating to securities registered on behalf of the Holders shall be borne by the holders of securities included in such registration pro rata among each other on the basis of the number of Registrable Securities so registered.

2.5 Registration Procedures . In the case of each registration effected by the Company pursuant to Section 2, the Company will keep each Holder advised in writing as to the initiation of each registration and as to the completion thereof. At its expense, the Company will use its commercially reasonable efforts to:

(a) Keep such registration effective for a period ending on the earlier of the date which is 60 days from the effective date of the registration statement or such time as the Holder or Holders have completed the distribution described in the registration statement relating thereto;

(b) To the extent the Company is a well-known seasoned issuer (as defined in Rule 405 under the Securities Act) (a “ WKSI ”) at the time any request for registration is submitted to the Company in accordance with Section 2.3, (i) if so requested, file an automatic shelf registration statement (as defined in Rule 405 under the Securities Act) (an “ automatic shelf registration statement ”) to effect such registration, and (ii) remain a WKSI (and not become an ineligible issuer (as defined in Rule 405 under the Securities Act)) during the period during which such automatic shelf registration statement is required to remain effective in accordance with this Agreement;

(c) Prepare and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement for the period set forth in subsection (a) above;

(d) Furnish such number of prospectuses, including any preliminary prospectuses, and other documents incident thereto, including any amendment of or supplement to the prospectus, as a Holder from time to time may reasonably request;

(e) Use its reasonable best efforts to register and qualify the securities covered by such registration statement under such other securities or Blue Sky laws of such jurisdiction as shall be reasonably requested by the Holders; provided , that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such states or jurisdictions;

(f) Notify each seller of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading or incomplete in light of the circumstances then existing, and following such notification promptly prepare and furnish to such seller a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of such shares, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading or incomplete in light of the circumstances then existing;

(g) Provide a transfer agent and registrar for all Registrable Securities registered pursuant to such registration statement and a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such registration;

(h) Cause all such Registrable Securities registered pursuant hereunder to be listed on each securities exchange on which similar securities issued by the Company are then listed; and

(i) In connection with any underwritten offering pursuant to a registration statement filed pursuant to Section 2.1, enter into an underwriting agreement in form reasonably necessary to effect the offer and sale of Ordinary Shares, provided such underwriting agreement contains reasonable and customary provisions, and provided further , that each Holder participating in such underwriting shall also enter into and perform its obligations under such an agreement.

2.6 Indemnification . To the extent permitted by law, each Holder will, if Registrable Securities held by such Holder are included in the securities as to which such registration, qualification or compliance is being effected, indemnify and hold harmless the Company, each of its directors, officers, partners, legal counsel and accountants and each underwriter, if any, of the Company’s securities covered by such a registration statement, each person who controls the Company or such underwriter within the meaning of Section 15 of the Securities Act, each other such Holder, and each of their officers, directors and partners, and each person controlling each other such Holder, against all claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on: (i) any untrue statement (or alleged untrue statement) of a material fact contained or incorporated by reference in any prospectus, offering circular or other document (including any related registration statement, notification, or the like) incident to any such registration, qualification or compliance, or (ii) any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse the Company and such Holders, directors, officers, partners, legal counsel and accountants, persons, underwriters, or control persons for any legal or any other expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability or action, in each case to the extent, but only to the extent, that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such registration statement, prospectus, offering circular or other document in reliance upon and in conformity with written information furnished to the Company by such Holder and stated to be specifically for use therein; provided , however , that the obligations of such Holder hereunder shall not apply to amounts paid in settlement of any such claims, losses, damages or liabilities (or actions in respect thereof) if such settlement is effected without the consent of such Holder (which consent shall not be unreasonably withheld); and provided that in no event shall any indemnity under this Section 2.6 exceed the net proceeds from the offering received by such Holder, except in the case of fraud or willful misconduct by such Holder.

(a) Each party entitled to indemnification under this Section 2.6 (the “ Indemnified Party ”) shall give notice to the party required to provide indemnification (the “ Indemnifying Party ”) promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the defense of such claim or any litigation resulting therefrom; provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or any litigation resulting therefrom, shall be approved by the Indemnified Party (whose approval shall not be unreasonably withheld), and the Indemnified Party may participate in such defense at such party’s expense; and provided further that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Section 2.6, to the extent such failure is not prejudicial. No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent of each Indemnified Party, consent to entry of any judgment or enter into any settlement that does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation. Each Indemnified Party shall furnish such information regarding itself or the claim in question as an Indemnifying Party may reasonably request in writing and as shall be reasonably required in connection with defense of such claim and litigation resulting therefrom.

(b) If the indemnification provided for in this Section 2.6 is held by a court of competent jurisdiction to be unavailable to an Indemnified Party with respect to any loss, liability, claim, damage, or expense referred to herein, then the Indemnifying Party, in lieu of indemnifying such Indemnified Party hereunder, shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, liability, claim, damage, or expense in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the Indemnified Party on the other in connection with the statements or omissions that resulted in such loss, liability, claim, damage, or expense as well as any other relevant equitable considerations. The relative fault of the Indemnifying Party and of the Indemnified Party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Party and the parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent such statement or omission. No person or entity will be required under this Section 2.6(c) to contribute any amount in excess of the net proceeds from the offering received by such person or entity, except in the case of fraud or willful misconduct by such person or entity. No person or entity guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any person or entity who was not guilty of such fraudulent misrepresentation.

(c) Notwithstanding the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control.

2.7 Information by Holder. Each Holder of Registrable Securities shall furnish to the Company such information regarding such Holder and the distribution proposed by such Holder as the Company may reasonably request in writing and as shall be reasonably required in connection with any registration, qualification, or compliance referred to in this Section 2.

2.8 Restrictions on Transfer . (a) The holder of each certificate representing Registrable Securities by acceptance thereof agrees to comply in all respects with the provisions of this Section 2.8. Each Holder agrees not to make any sale, assignment, transfer, pledge or other disposition of all or any portion of the Restricted Securities, or any beneficial interest therein, unless and until the transferee thereof has agreed in writing for the benefit of the Company to take and hold such Restricted Securities subject to, and to be bound by, the terms and conditions set forth in this Agreement, including, without limitation, this Section 2.8 and Section 2.10, and:

(i) There is then in effect a registration statement under the Securities Act covering such proposed disposition and the disposition is made in accordance with the registration statement; or

(ii) The Holder shall have given prior written notice to the Company of the Holder’s intention to make such disposition and shall have furnished the Company with a detailed description of the manner and circumstances of the proposed disposition, and the Holder shall have furnished the Company, at the Holder’s expense, with (i) an opinion of counsel, reasonably satisfactory to the Company, to the effect that such disposition will not require registration of such Restricted Securities under the Securities Act or (ii) a “no action” letter from the Commission to the effect that the transfer of such securities without registration will not result in a recommendation by the staff of the Commission that action be taken with respect thereto, whereupon the holder of such Restricted Securities shall be entitled to transfer such Restricted Securities in accordance with the terms of the notice delivered by the Holder to the Company.

(b) Notwithstanding the provisions of Section 2.8(a), no such registration statement, opinion of counsel or “no action” letter shall be necessary for (each of the following, a “ Permitted Transfer ”)

(i) in the case of any Madryn Holder, a transfer to any of their respective Affiliates; (ii) with respect to any other Holder, a transfer to any of such Holder’s Affiliates; (iii) with respect to a Holder who is an individual, a transfer to any member of such Holders family; and (iv) in the case of a Madryn Holder (in addition to clause (i) above) (A) a transfer pursuant to a pledge or grant of a security interest, to a bank or other funding source in support of borrowings made by such Madryn Holder from such Person, (B) a transfer by any Madryn Holder which is a fund pursuant to a pledge, or grant of a security interest, to its trustee in support of its obligations to its trustee (provided, that in the case of clauses (A) and (B), no pledge or grant of a security interest shall release the transferor Madryn Holder from any of its obligations hereunder), and (C) a transfer in connection with the Madryn Holder’s pro rata transfer of all or any part of or interest in any loans or other indebtedness owing to any such Madryn Holder under the Credit Agreement (the “ Credit Agreement ”) dated as of August 24, 2017, as amended, among the Company, the Guarantors (as defined in the Credit Agreement), the Lenders (as defined in the Credit Agreement) and Madryn Health Partners, LP, a Delaware limited partnership, as the Administrative Agent (as defined in the Credit Agreement) in accordance with the terms thereof.

(c) Each certificate representing Registrable Securities shall (unless otherwise permitted by the provisions of this Agreement) be stamped or otherwise imprinted with a legend substantially similar to the following (in addition to any legend required under applicable state securities laws):

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ ACT ”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED EXCEPT AS PERMITTED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS PURSUANT TO REGISTRATION OR AN EXEMPTION THEREFROM. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE ISSUER THAT SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION OTHERWISE COMPLIES WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO (1) RESTRICTIONS ON TRANSFERABILITY AND RESALE, INCLUDING A LOCK-UP PERIOD IN THE EVENT OF A PUBLIC OFFERING, AS SET FORTH IN AN INVESTORS’ RIGHTS AGREEMENT, AND (2) VOTING RESTRICTIONS AS SET FORTH IN A VOTING AGREEMENT AMONG THE COMPANY AND THE ORIGINAL HOLDERS OF THESE SHARES, COPIES OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE COMPANY.

(d) The first legend referring to federal and state securities laws identified in Section 2.8(b) stamped on a certificate evidencing the Restricted Securities and the share transfer instructions and record notations with respect to the Restricted Securities shall be removed and the Company shall issue a certificate without such legend to the holder of Restricted Securities if (i) those securities are registered under the Securities Act, or (ii) the holder provides the Company with an opinion of counsel reasonably acceptable

to the Company to the effect that a sale or transfer of those securities may be made without registration or qualification.

(e) Each Investor agrees not to make any sale, assignment, transfer, pledge or other disposition of any securities of the Company, or any beneficial interest therein, to any person other than the Company unless and until the proposed transferee confirms to the reasonable satisfaction of the Company that neither the proposed transferee nor any of its directors, executive officers, other officers that may serve as a director or officer of any company in which it invests, general partners or managing members nor any person that would be deemed a beneficial owner of those securities (in accordance with Rule 506(d) of the Securities Act) is subject to any Bad Actor Disqualification, except as set forth in Rule 506(d)(2) or (d)(3) under the Securities Act and disclosed, reasonably in advance of the transfer, in writing in reasonable detail to the Company.

(f) The Company shall not be obligated to recognize any attempted sale, assignment, transfer, pledge or other disposition of all or any portion of the Restricted Securities, or any beneficial interest therein, made other than in compliance with the terms and conditions of this Agreement. The Holders consent to the Company making a notation on its records and giving instructions to any transfer agent of the Restricted Securities in order to implement the restrictions on transfer established in this Agreement.

2.9 Rule 144 Reporting. With a view to making available the benefits of certain rules and regulations of the Commission that may permit the sale of the Restricted Securities to the public without registration, the Company agrees to use its commercially reasonable efforts to:

(a) Make and keep adequate current public information with respect to the Company available in accordance with Rule 144 under the Securities Act, at all times from and after ninety (90) days following the effective date of the first registration under the Securities Act filed by the Company for an offering of its securities to the general public;

(b) File with the Commission in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act at any time after it has become subject to such reporting requirements; and

(c) So long as a Holder owns any Restricted Securities, furnish to the Holder forthwith upon written request a written statement by the Company as to its compliance with the reporting requirements of Rule 144 (at any time from and after 90 days following the effective date of the first registration statement filed by the Company for an offering of its securities to the general public), and of the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements), a copy of the most recent annual or quarterly report of the Company, and such other reports and documents so filed as a Holder may reasonably request in availing itself of any rule or regulation of the Commission allowing a Holder to sell any such securities without registration.

2.10 Market Stand-Off Agreement. Each Holder shall not sell or otherwise transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale, of any Ordinary Shares (or other securities) of the Company held by such Holder (other than those included in the registration) during the period from the filing of the registration statement for the Company’s Initial Public Offering filed under the Securities Act that includes securities to be sold on behalf of the Company to the public in an underwritten public offering under the Securities Act through the end of the 180-day period following the effective date of the registration statement (or such other period as may be requested by the Company or an underwriter to accommodate regulatory restrictions on (i) the publication or other distribution of research reports and (ii) analyst recommendations and opinions, including, but not limited to, the restrictions contained in NASD Rule 2711(f)(4) or NYSE Rule 472(f)(4),

or any successor provisions or amendments thereto). The obligations described in this Section 2.10 shall not apply to a registration relating solely to employee benefit plans on Form S-l or Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer instructions and may stamp each such certificate with the second legend set forth in Section 2.8(b) with respect to the shares of Ordinary Shares (or other securities) subject to the foregoing restriction until the end of such 180-day (or other) period. Each Holder agrees to execute a market standoff agreement with said underwriters in customary form consistent with the provisions of this Section 2.10.

2.11 Delay of Registration . No Holder shall have any right to take any action to restrain, enjoin, or otherwise delay any registration as the result of any controversy that might arise with respect to the interpretation or implementation of this Section 2.

2.12 Transfer or Assignment of Registration Rights. The rights to cause the Company to register securities granted to a Holder by the Company under this Section 2 may be transferred or assigned by a Holder only to a transferee or assignee of not less than 100,000 shares of Registrable Securities (as presently constituted and subject to subsequent adjustments for share splits, share dividends, reverse share splits, and the like) (the “ Transfer Minimum ”) except with respect to a Permitted Transfer, to each of which the Transfer Minimum shall not apply; provided that (i) such transfer or assignment of Registrable Securities is affected in accordance with the terms of Section 2.8, the Right of First Refusal and Co-Sale Agreement, and applicable securities laws, (ii) the Company is given written notice prior to said transfer or assignment, stating the name and address of the transferee or assignee and identifying the securities with respect to which such registration rights are intended to be transferred or assigned and (iii) the transferee or assignee of such rights assumes in writing the obligations of such Holder under this Agreement, including without limitation the obligations set forth in Section 2.10.

2.13 Limitations on Subsequent Registration Rights . From and after the date of this Agreement, the Company shall not, without the prior written consent of Holders holding a majority of the Registrable Securities (excluding any of such shares held by any Holders whose rights to request registration or inclusion in any registration pursuant to this Section 2 have terminated in accordance with Section 2.14), enter into any agreement with any holder or prospective holder of any securities of the Company giving such holder or prospective holder any registration rights the terms of which are senior to the registration rights granted to the Holders hereunder.

2.14 Termination of Registration Rights . The right of any Holder to request registration or inclusion in any registration pursuant to Sections 2.1, 2.2 or 2.3 shall terminate on the earlier of (i) such date, on or after the closing of the Company’s first registered public offering of Ordinary Shares, on which all shares of Registrable Securities held or entitled to be held upon conversion by such Holder may immediately be sold under Rule 144 during any 90-day period and (ii) three years after the closing of the Company’s Initial Public Offering.

SECTION 3.

COVENANTS

3.1 Basic Financial Information and Inspection Rights ^.

(a) Basic Financial Information. The Company will furnish the following reports to each Holder who, individually or collectively with any subsidiary or other affiliate of the Holder, owns at least 250,000 Shares (as presently constituted and subject to subsequent adjustments for share splits, share dividends, reverse share splits, and the like) (each a “ Significant Holder ”):

(i) As soon as practicable after the end of each fiscal year of the Company, and in any event within 120 days after the end of each fiscal year of the Company, a consolidated balance sheet of the Company and its subsidiaries, if any, as at the end of such fiscal year, and consolidated statements of income and cash flows of the Company and its subsidiaries, if any, for such year, prepared in accordance with U.S. generally accepted accounting principles consistently applied, certified by independent public accountants selected by the Company; and

(ii) As soon as practicable after the end of the first, second and third quarterly accounting periods in each fiscal year of the Company, and in any event within 45 days after the end of the first, second, and third quarterly accounting periods in each fiscal year of the Company, an unaudited consolidated balance sheet of the Company and its subsidiaries, if any, as of the end of each such quarterly period, and unaudited consolidated statements of income and cash flows of the Company and its subsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments.

(b) Inspection Rights. The Company will afford to each Significant Holder reasonable access during normal business hours to all of the Company’s respective properties, books and records. Each such Significant Holder shall have such other access to management and information as is necessary for it to comply with applicable laws and regulations and reporting obligations. The Company shall not be required to disclose details of contracts with or work performed for specific customers and other business partners where to do so would violate confidentiality obligations to those parties. Significant Holders may exercise their rights under this Section 3.1(b) only for purposes reasonably related to their interests under this Agreement and related agreements. The rights granted pursuant to this Section 3.1(b) may not be assigned or otherwise conveyed by the Significant Holders or by any subsequent transferee of any such rights without the prior written consent of the Company except as authorized in this Section 3.1(b).

3.2 Confidentiality. Anything in this Agreement to the contrary notwithstanding, no Holder by reason of this Agreement shall have access to any trade secrets or classified information of the Company. The Company shall not be required to comply with any information rights of Section 3 in respect of any Holder whom the Company reasonably determines to be a competitor or an officer, employee, director or holder of more than one percent (1%) of a competitor. Each Holder acknowledges that the information received by them pursuant to this Agreement may be confidential and for its use only, and it will not use such confidential information in violation of the Exchange Act or reproduce, disclose or disseminate such information to any other person (other than its employees or agents having a need to know the contents of such information, and its attorneys), except in connection with the exercise of rights under this Agreement, unless the Company has made such information available to the public generally. For so long as any obligations remain outstanding under the Credit Agreement, this Section 3.2 shall not apply to any Holder which is also a “Lender” thereunder; provided that each such Holder agrees (for itself and each of its Affiliates) that it will comply with Section 11.07 of the Credit Agreement as in effect from time to time and, provided further, that each such Holder agrees to be bound by this Section 3.2 during all periods in which (a) this Agreement remains in effect and (b) the Credit Agreement is not in effect or such Holder is not a “Lender” thereunder.

3.3 “Bad Actor” Notice. Each party to this Agreement will promptly notify each other party to this Agreement in writing if it or, to its knowledge, any person specified in Rule 506(d)(1) under the Securities Act becomes subject to any Bad Actor Disqualification.

3.4 Board Matters. The Company shall reimburse the directors for all reasonable out-of-pocket travel expenses incurred (consistent with the Company’s travel policy) in connection with attending meetings of the Board of Directors.

3.5 Termination of Covenants. The covenants set forth in this Section 3 shall terminate and be of no further force and effect after the closing of the Company’s Initial Public Offering.

SECTION 4.

RIGHT OF FIRST REFUSAL – NEW SECURITIES

4.1 Exercise by Significant Holders. The Company hereby grants to each Significant Holder the right of first refusal to purchase its pro rata share of New Securities (as defined in this Section 4.1(a)) which the Company may, from time to time, propose to sell and issue after the date of this Agreement. A Significant Holder’s pro rata share, for purposes of this right of first refusal, is equal to the ratio of (a) the number of Ordinary Shares owned by such Significant Holder immediately prior to the issuance of New Securities (assuming full conversion of the Shares and full conversion or exercise of all outstanding convertible securities, rights, options and warrants held by such Significant Holder) to (b) the total number of Ordinary Shares outstanding immediately prior to the issuance of New Securities (assuming full conversion of the Shares and full conversion or exercise of all outstanding convertible securities, rights, options and warrants). Each Significant Holder shall have a right of over-allotment such that if any Significant Holder fails to exercise its right hereunder to purchase its pro rata share of New Securities, the other Significant Holders may purchase the non-purchasing Significant Holder’s portion on a pro rata basis. This right of first refusal shall be subject to the following provisions:

(a) “ New Securities ” shall mean any shares (including Ordinary Shares) of the Company whether now authorized or not, and rights, convertible securities, options or warrants to purchase such shares, and securities of any type whatsoever that are, or may become, exercisable or convertible into shares; provided that the term “ New Securities ” does not include:

(i) the Shares;

(ii) the Exempted Securities; and

(iii) Common Shares issued in an Initial Public Offering.

(b) In the event the Company proposes to undertake an issuance of New Securities, it shall give each Significant Holder written notice of its intention, describing the type of New Securities, and their price and the general terms upon which the Company proposes to issue the same. Each Significant Holder shall have 10 days after any such notice is mailed or delivered to agree to purchase such Holder’s pro rata share of such New Securities and to indicate whether such Holder desires to exercise its over-allotment option for the price and upon the terms specified in the notice by giving written notice to the Company, in substantially the form attached as Schedule 1, and stating therein the quantity of New Securities to be purchased.

(c) In the event the Holders fail to exercise fully the right of first refusal and over-allotment rights, if any, within said 10-day period (the “ Election Period ”), the Company shall have 90 days thereafter to sell or enter into an agreement (pursuant to which the sale of New Securities covered thereby shall be closed, if at all, within 90 days from the date of said agreement) to sell that portion of the New Securities with respect to which the Significant Holders’ right of first refusal option set forth in this Section 4.1 was not exercised, at a price and upon terms no more favorable to the purchasers thereof than specified in the Company’s notice to Significant Holders delivered pursuant to Section 4.1(b). In the event the Company has not sold within such 90-day period following the Election Period, or such 90-day period following the date of said agreement, the Company shall not thereafter issue or sell any New Securities, without first again offering such securities to the Significant Holders in the manner provided in this Section 4.1.

(d) The right of first refusal granted under this Section 4 shall expire upon, and shall not be applicable to, the Company’s Initial Public Offering.

(e) A Holder will not have a right of first refusal to purchase a pro rata share of New Securities in accordance with this Section 4 and will not be a Significant Holder for purposes of the right of first refusal granted under this Section 4 if, and for so long as, the Holder, any of its directors, executive officers, other officers that may serve as a director or officer of any company in which it invests, general partners or managing members or any person that would be deemed a beneficial owner of the securities of the Company held by the Holder (in accordance with Rule 506(d) of the Securities Act) is subject to any Bad Actor Disqualification, except as set forth in Rule 506(d)(2) or (d)(3) under the Securities Act.

SECTION 5.

MISCELLANEOUS

5.1 Amendment. Except as expressly provided herein, neither this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument referencing this Agreement and signed by the Company and the Holders holding a majority of the Registrable Securities (excluding any of such shares that have been sold to the public or pursuant to Rule 144, and excluding, with respect to Section 2 (other than Sections 2.8, 2.9 and 2.10), any of such shares held by any Holders whose rights to request registration or inclusion in any registration pursuant to Section 2 have terminated in accordance with Section 2.14); provided , however , that Holders purchasing Class G Ordinary Shares or Class G-1 Ordinary Shares after the date herefof may become parties to this Agreement, by executing a counterpart of this Agreement without any amendment of this Agreement pursuant to this paragraph or any consent or approval of any other Holder. Any such amendment, waiver, discharge or termination effected in accordance with this paragraph shall be binding upon each Holder and each future holder of all such securities of Holder. Each Holder acknowledges that by the operation of this paragraph, the holders of a majority of the Registrable Securities (excluding any of such shares that have been sold to the public or pursuant to Rule 144, and excluding, with respect to Section 2 (other than Sections 2.8, 2.9 and 2.10), any of such shares held by any Holders whose rights to request registration or inclusion in any registration pursuant to Section 2 have terminated in accordance with Section 2.14) will have the right and power to diminish or eliminate all rights of such Holder under this Agreement. Notwithstanding anything to the contrary set forth herein, (a) no amendment or waiver which, by its terms, adversely affects any Holder of Ordinary Shares in a unique or disproportionate manner relative to all Holders of the Ordinary Shares shall be effective without the prior written consent of each such Holder of Ordinary Shares; and (b) no amendment to or waiver of any right or protection specifically granted to any Madryn Holder, in a manner adverse to such Madryn Holder, shall be effective without the written consent of such Madryn Holder.

5.2 No Effect Upon Lending Relationship . Notwithstanding anything herein to the contrary, nothing contained herein shall affect, limit or impair the rights and remedies of the Madryn Holders or any of its affiliates in its capacity as a lender to the Company pursuant to any agreement under which the Company has borrowed money from any Madryn Holder. Without limiting the generality of the foregoing, no Madryn Holder, in exercising its rights as a lender, including making its decision on whether to foreclose on any collateral security, will have any duty to consider (i) its status or the status of any of its affiliates as a direct or indirect equity holder of the Company, (ii) the equity of the Company or (iii) any duty it may have to any other direct or indirect equity holder of the Company, except as may be required under the applicable loan documents or by commercial law applicable to creditors generally.

5.3 Notices. All notices and other communications required or permitted hereunder shall be in writing and shall be mailed by registered or certified mail, postage prepaid, or otherwise delivered by hand, messenger or courier service addressed:

(a) if to an Investor, to the Investor’s address as shown in the Company’s records, as may be updated in accordance with the provisions hereof;

(b) if to any Holder, to such address as shown in the Company’s records, or, until any such Holder so furnishes an address to the Company, then to the address of the last holder of such shares for which the Company has contact information in its records; or

(c) if to the Company, to the attention of the Chief Executive Officer or Chief Financial Officer of the Company at Building B-25 Coyol Free Zone, Alajuela, Costa Rica, or at such other current address as the Company shall have furnished to the Investors or Holders, with a copy (which shall not constitute notice) to Elton Satusky, Wilson Sonsini Goodrich & Rosati, P.C., 650 Page Mill Road, Palo Alto, CA 94304.

Each such notice or other communication shall for all purposes of this Agreement be treated as effective or having been given (i) if delivered by hand, messenger or courier service, when delivered (or if sent via a nationally-recognized overnight courier service, freight prepaid, specifying next-business-day delivery, one business day after deposit with the courier), or (ii) if sent via mail, at the earlier of its receipt or five days after the same has been deposited in a regularly-maintained receptacle for the deposit of the United States mail, addressed and mailed as aforesaid. In the event of any conflict between the Company’s books and records and this Agreement or any notice delivered hereunder, the Company’s books and records will control absent fraud or error.

Subject to the limitations set forth in Delaware General Corporation Law §232(e), each Investor and Holder consents to the delivery of any notice to shareholders given by the Company under the Delaware General Corporation Law or the Company’s memorandum and articles of association by (i) facsimile telecommunication to the facsimile number set forth on Exhibit A (or to any other facsimile number for the Investor or Holder in the Company’s records), (ii) electronic mail to the electronic mail address set forth on Exhibit A (or to any other electronic mail address for the Investor or Holder in the Company’s records), (iii) posting on an electronic network together with separate notice to the Investor or Holder of such specific posting or (iv) any other form of electronic transmission (as defined in the Delaware General Corporation Law) directed to the Investor or Holder. This consent may be revoked by an Investor or Holder by written notice to the Company and may be deemed revoked in the circumstances specified in Delaware General Corporation Law §232.

5.4 Governing Law. This Agreement shall be governed in all respects by the internal laws of the State of California as applied to agreements entered into among California residents to be performed entirely within California, without regard to principles of conflicts of law.

5.5 Successors and Assigns. This Agreement, and any and all rights, duties and obligations hereunder, shall not be assigned, transferred, delegated or sublicensed by any Investor without the prior written consent of the Company. Any attempt by an Investor without such permission to assign, transfer, delegate or sublicense any rights, duties or obligations that arise under this Agreement shall be void. Subject to the foregoing and except as otherwise provided herein, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto.

5.6 Entire Agreement. This Agreement and the exhibits hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof. No party hereto shall

be liable or bound to any other party in any manner with regard to the subjects hereof or thereof by any warranties, representations or covenants except as specifically set forth herein.

5.7 Delays or Omissions. Except as expressly provided herein, no delay or omission to exercise any right, power or remedy accruing to any party to this Agreement upon any breach or default of any other party under this Agreement shall impair any such right, power or remedy of such non-defaulting party, nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring, nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or default under this Agreement, or any waiver on the part of any party of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to any party to this Agreement, shall be cumulative and not alternative.

5.8 Severability. If any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, portions of such provision, or such provision in its entirety, to the extent necessary, shall be severed from this Agreement, and such court will replace such illegal, void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the same economic, business and other purposes of the illegal, void or unenforceable provision. The balance of this Agreement shall be enforceable in accordance with its terms.

5.9 Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. All references in this Agreement to sections, paragraphs and exhibits shall, unless otherwise provided, refer to sections and paragraphs hereof and exhibits attached hereto.

5.10 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be enforceable against the parties that execute such counterparts, and all of which together shall constitute one instrument.

5.11 Telecopy Execution and Delivery. A facsimile, telecopy or other reproduction of this Agreement may be executed by one or more parties hereto and delivered by such party by facsimile or any similar electronic transmission device pursuant to which the signature of or on behalf of such party can be seen. Such execution and delivery shall be considered valid, binding and effective for all purposes. At the request of any party hereto, all parties hereto agree to execute and deliver an original of this Agreement as well as any facsimile, telecopy or other reproduction hereof.

5.12 Jurisdiction; Venue. With respect to any disputes arising out of or related to this Agreement, the parties consent to the exclusive jurisdiction of, and venue in, the state courts in San Francisco County in the State of California (or in the event of exclusive federal jurisdiction, the courts of the Northern District of California).

5.13 Further Assurances. Each party hereto agrees to execute and deliver, by the proper exercise of its corporate, limited liability company, partnership or other powers, all such other and additional instruments and documents and do all such other acts and things as may be necessary to more fully effectuate this Agreement.

5.14 Termination Upon Change of Control. Notwithstanding anything to the contrary herein, this Agreement (excluding any then‑existing obligations) shall terminate upon (a) the acquisition of the Company by another entity by means of any transaction or series of related transactions to which the Company

is party (including, without limitation, any share acquisition, reorganization, merger or consolidation but excluding any sale of shares for capital raising purposes) other than a transaction or series of transactions in which the holders of the voting securities of the Company outstanding immediately prior to such transaction continue to retain (either by such voting securities remaining outstanding or by such voting securities being converted into voting securities of the surviving entity), as a result of shares in the Company held by such holders prior to such transaction, at least fifty percent (50%) of the total voting power represented by the voting securities of the Corporation or such surviving entity outstanding immediately after such transaction or series of transactions; or (b) a sale, lease or other conveyance of all substantially all of the assets of the Company.

5.15 Conflict. In the event of any conflict between the terms of this Agreement and the Company’s memorandum and articles of association, the terms of the Company’s memorandum and articles of association, as the case may be, will control.

5.16 Attorneys’ Fees. In the event that any suit or action is instituted to enforce any provision in this Agreement, the prevailing party in such dispute shall be entitled to recover from the losing party all fees, costs and expenses of enforcing any right of such prevailing party under or with respect to this Agreement, including without limitation, such reasonable fees and expenses of attorneys and accountants, which shall include, without limitation, all fees, costs and expenses of appeals.

5.17 Aggregation of Shares. All securities held or acquired by affiliated entities (including affiliated venture capital funds) or persons shall be aggregated together for purposes of determining the availability of any rights under this Agreement.

(signature page follows)

The parties are signing this Investors’ Rights Agreement as of the date stated in the introductory clause.



ESTABLISHMENT LABS HOLDINGS INC.
a British Virgin Islands company

By:	/s/ Juan Jose Chacon Quiros
Name:	Juan Jose Chacon Quiros
Title:	Chief Executive Officer

(Signature Page to the Amended and Restated Investors’ Rights Agreement)

EXHIBIT A

INVESTORS

CPH TU, L.P.

Sariel, LLC

Blueberry Capital AS

Marius Borthen

Michael & Angela Skinner

Lisa N. Colleran & Machac, Charles R.

Eddie De Oliviera

Luc Dewandre

Jusucep Douglas

Karl J. Feitelberg

Janken Hoffman

Andrew Prevost

Shapero 2015 Trust

Reidar Alexander Vigen

Srdjan Vukovic

Bellakliniken AB

George J. Dennis

Experien Group, LLC

KW - Venus, LP

Leor A. Trink

Ronald Glickman

Ibionics Holdings, LLC

TI Partners LLC

Daniel A. DelVecchio

Midland IRA FBO Caroline Draft #1639105

Caroline D. Draft

Midland IRA FBO Howard Draft #1633235

Florence Capital Advisors SPV, I LLC

KW - Venus, LP

Douglas Kaplan

Darren Lazarus

Louis R. Malikow

Kerry Propper

SC Goldstein Holdings LLC

Jeffrey DiModica & Kay Story

Fifth Set Ventures LLC

Florence Capital Advisors SPV, I LLC

Gail Quartner Roth IRA

Cynthia Spear

KW-Venus II, LP

DRAMM Inc.

David Simkins Grantor Trust

Madryn Health Partners (Cayman Master), LP

Madryn Health Partners, LP

George J. Dennis

Dramm, Inc

James Andrew Mazur

Danosch Zahedi Ahrami

Sven Andreas Svee

Marc Mazur

Monroe Capital, LLC

Johan Andersson

Stephan Lichtsteiner

Bryan Slotkin

Daniel Bertholet

Brian Meany

Besara Invest AB

Bellakliniken AB

Castrasim Holdings, LLC

Richard K. Hale

Brian Stern

RTW Master Fund, Ltd.

RTW Innovation Master Fund, Ltd.

EXHIBIT B

FORM OF
NOTICE OF SHARE TRANSFER

Notice of Transfer

[_______] intends to transfer shares of the Company’s shares as indicated below (the “ Offered Shares ”).

Notice of Rights

Pursuant to the Amended and Restated Investor Rights Agreement, dated as of May 17, 2018 (the “ Agreement ”), this notice is to inform you of your Transfer ROFR (as defined in the Agreement) with respect to the Offered Shares. If you choose to do so, you may exercise one (but not both) of these rights with respect to the Offered Shares by returning this notice to the address below, with a copy to Establishment Labs Holdings Inc. If you decline your right to do so, you do not need to return anything. Your failure to return this notice on a timely basis will indicate that you have declined to exercise your Transfer ROFR with respect to the Offered Shares.

Description of Transfer


1.	Type and aggregate number of shares to be transferred:


2.	Type of transfer ( please check one ):

o Sale

o Other. Describe:


3.	Proposed transferees:



	Name and address	Type, amount and price of shares
1.	[ insert name of proposed transferee ] [ insert address of proposed transferee ] [ insert phone number of proposed transferee ]	[ enter amount, type and price of shares ]
2.	[ insert name of proposed transferee ] [ insert address of proposed transferee ] [ insert phone number of proposed transferee ]	[ enter amount, type and price of shares ]


4.	Consideration:

• Total cash consideration:

• Total fair market value of non-cash consideration (if any) as of the date of the notice:

• Description of any non-cash consideration:


5.	“Bad Actor” Status of Proposed Transferees:

No proposed transferee nor any director, executive officer, other officer that may serve as a director or officer of any company in which the proposed transferee invests, general partner or managing member of a proposed transferee nor any person that would be deemed a beneficial owner of the Offered Shares (in accordance with Rule 506(d) of the Securities Act of 1933, as amended (the “Securities Act”)) is subject to any of the “bad actor” disqualifications described in Rule 506(d)(1)(i) through (viii) under the Securities Act (“Bad Actor Disqualifications”).


o	A Bad Actor Disqualification (or an exception thereto) may apply. Describe:

Election

Please respond as applicable:

I exercise my Transfer ROFR o

I wish to buy ________ shares of ________ shares.

[ Specify applicable return dates for the notice ]. There will be no extension of this deadline.

[Enter seller’s name and address]

[Enter the company’s address and contact person]

SCHEDULE 1

NOTICE AND WAIVER/ELECTION OF

NEW SECURITIES ROFR

I do hereby waive or exercise, as indicated below, my right of first refusal as defined by and under the Amended and Restated Investors’ Rights Agreement dated as of May 17, 2018 (the “ Agreement ”) :


1.	Waiver of [___] days’ notice period in which to exercise right of first refusal: (please check only one)


( )	WAIVE in full, on behalf of all Holders, the [___]-day notice period provided to exercise my right of first refusal granted under the Agreement.


( )	DO NOT WAIVE the notice period described above.


2.	Issuance and Sale of New Securities: (please check only one)


( )	WAIVE in full the right of first refusal granted under the Agreement with respect to the issuance of the New Securities.


( )	ELECT TO PARTICIPATE in $__________ ( please provide amount ) in New Securities proposed to be issued by Establishment Labs Holdings Inc., a company incorporated under the laws of the British Virgin Islands, representing LESS than my pro rata portion of the aggregate of $[_______] in New Securities being offered in the financing.


( )	ELECT TO PARTICIPATE in $__________ in New Securities proposed to be issued by Establishment Labs Holdings Inc., a company incorporated under the laws of the British Virgin Islands, representing my FULL pro rata portion of the aggregate of $[_______] in New Securities being offered in the financing.

( ) ELECT TO PARTICIPATE in my full pro rata portion of the aggregate of $[_______] in New Securities being made available in the financing AND, to the extent available, the greater of (x) an additional $__________ ( please provide amount ) or (y) my pro rata portion of any remaining investment amount available in the event other Significant Holders do not exercise their full rights of first refusal with respect to the $[_______] in New Securities being offered in the financing.



Date
			(Print investor name)

			(Signature)

			(Print name of signatory, if signing for an entity)

			(Print title of signatory, if signing for an entity)

This is neither a commitment to purchase nor a commitment to issue the New Securities described above. Such issuance can only be made by way of definitive documentation related to such issuance. Establishment Labs Holdings Inc. will supply you with such definitive documentation upon request or if you indicate that you would like to exercise your first offer rights in whole or in part.

Exhibit 4.3

SECOND AMENDMENT TO CREDIT AGREEMENT AND WAIVER

THIS SECOND AMENDMENT TO CREDIT AGREEMENT AND WAIVER (this “ Agreement ”) dated as of June 15, 2018 (the “ Second Amendment Effective Date ”) is entered into among ESTABLISHMENT LABS HOLDINGS INC., a BVI business company, limited by shares and incorporated under the laws of the British Virgin Islands (the “ Borrower ”), the Guarantors party hereto, the Lenders party hereto and MADRYN HEALTH PARTNERS, LP, a Delaware limited partnership, as Administrative Agent. All capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Existing Credit Agreement (as defined below) or the Amended Credit Agreement (as defined below).

RECITALS

WHEREAS, the Borrower, the Guarantors party thereto, the Lenders party thereto and the Administrative Agent have entered into that certain Credit Agreement dated as of August 24, 2017 (as amended by that certain First Amendment to Credit Agreement dated as of October 31, 2017 and as further amended, restated, supplemented or modified from time to time prior to the date hereof, the “ Existing Credit Agreement ”);

WHEREAS, the Borrower has requested that the Lenders waive the Events of Default set forth in Exhibit A to this Agreement (such Events of Default, the “ Existing Events of Default ”);

WHEREAS, the Borrower has requested that the Existing Credit Agreement be amended to provide for certain modifications of the terms of the Existing Credit Agreement, and that, as so amended, the Existing Credit Agreement for ease of reference be restated (after giving effect to this Agreement) in the form of Schedule 1 hereto; and

WHEREAS, the Lenders are willing to waive the Existing Events of Default and amend the Existing Credit Agreement, in each case, subject to the terms and conditions hereof;

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Amendments . Effective as of the Second Amendment Effective Date:

(a) The Existing Credit Agreement is hereby amended by this Agreement and for ease of reference restated (after giving effect to this Agreement) in the form of Schedule 1 hereto (the Existing Credit Agreement, as so amended by this Agreement, being referred to as the “ Amended Credit Agreement ”).

(b) Exhibit E to the Existing Credit Agreement is hereby amended and restated to read, in its entirety, in the form of Schedule 2 hereto.

Except as expressly set forth above, all Exhibits to the Existing Credit Agreement will continue in their present forms as Exhibits to the Amended Credit Agreement.

2. Waiver of Existing Events of Default . Subject to the other terms and conditions of this Agreement, the Lenders hereby waive the Existing Events of Default. The above shall not modify or affect the Loan Parties’ obligations to comply fully with the terms of the Credit Agreement or any other duty, term,

condition or covenant contained in the Credit Agreement or any other Investment Document in the future. This waiver is limited solely to the Existing Events of Default, and nothing contained in this Agreement shall be deemed to constitute a waiver of any other rights or remedies the Administrative Agent or any Lender may have under the Credit Agreement or any other Investment Documents or under applicable Law.

3. Conditions Precedent . This Agreement shall be effective upon satisfaction of the following conditions precedent:

(a) Agreement . Receipt by the Administrative Agent of counterparts of this Agreement duly executed by the Loan Parties, the Lenders and the Administrative Agent;

(b) Investor Rights Agreements and Share Purchase Agreements . Receipt by the Administrative Agent of an executed copy of each investor rights agreement and share purchase agreement entered into by the Borrower subsequent to the Funding Date;

(c) Financial Statements . Receipt by the Administrative Agent of the audited financial statements and accompanying report and opinion of an independent certified public accountant of nationally recognized standing required by Section 7.01 of the Amended Credit Agreement (excluding, for the avoidance of doubt, the requirement that such report and opinion not be subject to any “going concern” or like qualification or exception) for the fiscal year ended December 31, 2017;

(d) Capitalization Table . Receipt by the Administrative Agent of a current capitalization table of the Borrower as of the Second Amendment Effective Date, broken out to show each owner of the Borrower’s Class G and G-1 Equity Interests, in form and substance satisfactory to the Administrative Agent;

(e) Motiva Nordica AB . Receipt by the Administrative Agent of a certificate of a Responsible Officer of the Borrower setting forth the information required by Section 7.12(a) of the Existing Credit Agreement for Motiva Nordica AB, in form and substance reasonably satisfactory to the Administrative Agent;

(f) Form S-1 Registration Statement and Related Correspondence . Receipt by the Administrative Agent of the Borrower’s current Form S-1 Registration Statement (together with any exhibits and amendments thereto) filed with the SEC and all related correspondence with the SEC; and

(g) Legal Fees . Receipt by Moore & Van Allen PLLC, counsel to the Administrative Agent, of its fees and expenses incurred in connection with this Agreement and any forbearance agreement entered into prior to the Second Amendment Effective Date.

4. Reaffirmation . Each of the Loan Parties acknowledges and reaffirms (a) that it is bound by all of the terms of the Investment Documents to which it is a party (including the ROFR Side Letter, which, for the avoidance of doubt, has an Available Amount (as defined therein) as of the Second Amendment Effective Date of $2,000,000) and (b) that it is responsible for the observance and full performance of all Obligations, including without limitation, the repayment of the Loans. Furthermore, the Loan Parties acknowledge and confirm (i) that the Administrative Agent and the Lenders have performed fully all of their obligations under the Credit Agreement and the other Investment Documents and (ii) that by entering into this Agreement, the Administrative Agent and the Lenders do not, except as expressly set forth herein, waive or release any term or condition of the Credit Agreement or any of the other Investment Documents or any

of their rights or remedies under such Investment Documents or any applicable Law or any of the obligations of the Loan Parties thereunder.

5. Release . As a material part of the consideration for Administrative Agent and the Lenders entering into this Agreement, the Loan Parties agree as follows (the “ Release Provision ”):

(a) By their respective signatures below, the Loan Parties hereby agree that the Administrative Agent, the Lenders, each of their respective Affiliates and the foregoing Persons’ respective officers, managers, members, directors, advisors, sub-advisors, partners, agents and employees, and their respective successors and assigns (hereinafter all of the above collectively referred to as the “ Lender Group ”), are irrevocably and unconditionally released, discharged and acquitted from any and all actions, causes of action, claims, demands, damages and liabilities of whatever kind or nature, in law or in equity, now known or unknown, suspected or unsuspected to the extent that any of the foregoing arises from any action or failure to act under or otherwise arising in connection with the Investment Documents on or prior to the Second Amendment Effective Date.

(b) Each Loan Party hereby acknowledges, represents and warrants to the Lender Group that:

(i) it has read and understands the effect of the Release Provision. Each Loan Party has had the assistance of independent counsel of its own choice, or has had the opportunity to retain such independent counsel, in reviewing, discussing, and considering all the terms of the Release Provision; and if counsel was retained, counsel for such Loan Party has read and considered the Release Provision and advised such Loan Party with respect to the same. Before execution of this Agreement, such Loan Party has had adequate opportunity to make whatever investigation or inquiry it may deem necessary or desirable in connection with the subject matter of the Release Provision.

(ii) no Loan Party is acting in reliance on any representation, understanding, or agreement not expressly set forth herein. Each Loan Party acknowledges that the Lender Group has not made any representation with respect to the Release Provision except as expressly set forth herein.

(iii) each Loan Party has executed this Agreement and the Release Provision thereof as its free and voluntary act, without any duress, coercion, or undue influence exerted by or on behalf of any person.

(iv) the Loan Parties are the sole owners of the claims released by the Release Provision, and no Loan Party has heretofore conveyed or assigned any interest in any such claim to any other Person.

(c) Each Loan Party understands that the Release Provision was a material consideration in the agreement of the Administrative Agent and the Lenders to enter into this Agreement. The Release Provision shall be in addition to any rights, privileges and immunities granted to the Administrative Agent and the Lenders under the Investment Documents.

6. Miscellaneous .

(a) The Credit Agreement and the obligations of the Loan Parties thereunder and under the other Investment Documents, except as expressly modified by this Agreement, are hereby ratified

and confirmed and shall remain in full force and effect according to their terms. This Agreement is a Loan Document.

(b) Each Guarantor (i) acknowledges and consents to all of the terms and conditions of this Agreement, (ii) affirms all of its obligations under the Loan Documents and (iii) agrees that this Agreement and all documents executed in connection herewith do not operate to reduce or discharge its obligations under the Credit Agreement or the Loan Documents.

(i) each Loan Party has taken all necessary corporate or other organizational action to authorize the execution, delivery and performance of this Agreement.

(ii) this Agreement has been duly executed and delivered by each Loan Party party hereto and constitutes a legal, valid and binding obligation of each such Loan Party, enforceable against each such Loan Party in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium and similar laws affecting enforceability of creditors’ rights generally and to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(iii) no approval, consent, exemption, authorization or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against, any Loan Party of this Agreement.

(iv) (A) the representations and warranties of the Borrower and each other Loan Party contained in Article VI of the Credit Agreement or any other Investment Document, or which are contained in any document furnished at any time under or in connection therewith, are true and correct in all material respects (and in all respects if any such representation and warranty is already qualified by materiality or reference to Material Adverse Effect) on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (and in all respects if any such representation and warranty is already qualified by materiality or reference to Material Adverse Effect) as of such earlier date and (B) no event has occurred and is continuing which constitutes a Default or an Event of Default.

(d) Each of the Loan Parties hereby affirms the Liens created and granted in the Loan Documents in favor of the Administrative Agent, for the benefit of the Secured Parties, and agrees that this Agreement does not adversely affect or impair such liens and security interests in any manner.

(e) This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic imaging means (e.g. “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this Agreement.

(f) If any provision of this Agreement is held to be illegal, invalid or unenforceable, (i) the legality, validity and enforceability of the remaining provisions of this Agreement shall not

be affected or impaired thereby and (ii) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

(g) THIS AGREEMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

[SIGNATURE PAGES FOLLOW]

IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be duly executed as of the date first above written.



BORROWER:	ESTABLISHMENT LABS HOLDINGS INC., a BVI business company incorporated under the laws of the British Virgin Islands

	By:	/s/ Juan Jose Chacon Quiros
	Name: Juan Jose Chacon Quiros
	Title: Director

GUARANTORS:	ESTABLISHMENT LABS SOCIEDAD ANONIMA, a Costa Rica corporation

	By:	/s/ Juan Jose Chacon Quiros
	Name: Juan Jose Chacon Quiros
	Title: Secretary

	EUROPEAN DISTRIBUTION CENTER MOTIVA BVBA, a Belgium besloten vennootschap met beperkte aansprakelijkheid

	By:	/s/ Juan Jose Chacon Quiros
	Name: Juan Jose Chacon Quiros
	Title: Manager

	ESTABLISHMENT LABS BRASIL PRODUTOS PARA SAUDE LTDA., a Brazil limited liability company

	By:	/s/ Eddie de Oliveira
	Name: Eddie de Oliveira
	Title: Manager

	JAMM TECHNOLOGIES, INC., a Delaware corporation

	By:	/s/ Salvador Dada Santos
	Name: Salvador Dada Santos
	Title: Secretary

	MOTIVA USA LLC, a Delaware limited liability company

	By:	/s/ Juan Jose Chacon Quiros
	Name: Juan Jose Chacon Quiros
	Title: Director

ESTABLISHMENT LABS HOLDINGS INC.

SECOND AMENDMENT TO CREDIT AGREEMENT AND WAIVER



ADMINISTRATIVE AGENT:	MADRYN HEALTH PARTNERS, LP,
	By:	MADRYN HEALTH ADVISORS, LP, its General Partner

		By:	MADRYN HEALTH ADVISORS GP, LLC, its General Partner

			By:	/s/ Avinash Amin
			Name:	Avinash Amin
			Title:	Member

ESTABLISHMENT LABS HOLDINGS INC.

SECOND AMENDMENT TO CREDIT AGREEMENT AND WAIVER



LENDERS:	MADRYN HEALTH PARTNERS, LP,

	By:	MADRYN HEALTH ADVISORS, LP, its General Partner

		By:	MADRYN HEALTH ADVISORS GP, LLC, its General Partner

			By:	/s/ Avinash Amin
			Name:	Avinash Amin
			Title:	Member

	MADRYN HEALTH PARTNERS (CAYMAN MASTER), LP,

	By:	MADRYN HEALTH ADVISORS, LP, its General Partner

			By:	/s/ Avinash Amin
			Name:	Avinash Amin
			Title:	Member

ESTABLISHMENT LABS HOLDINGS INC.

SECOND AMENDMENT TO CREDIT AGREEMENT AND WAIVER

EXHIBIT A

EXISTING EVENTS OF DEFAULT


1.	Failure to notify the Administrative Agent of information relating to Motiva Nordica AB (the “ New Subsidiary ”) within thirty (30) days of formation of such New Subsidiary, as required under Section 7.12 of the Existing Credit Agreement.


2.	Failure to put a Qualifying Control Agreement in place for deposit account number [***] of Motiva USA, LLC held at Wells Fargo Bank for the period between January 19, 2018 and March 19, 2018, as required under Section 7.18 of the Existing Credit Agreement.


3.	The making of Investments by European Distribution Center Motiva BVBA in Establishment Labs Brasil Produtos Para Saude LTDA. in excess of the aggregate amount permitted under Section 8.02(c) of the Existing Credit Agreement. As of May 31, 2018 the aggregate amount of such Investments total [***] (the “ Total Brazil Investments ”).


4.	The incurrence of Indebtedness constituting a portion of the Total Brazil Investments not permitted under Section 8.03 of the Existing Credit Agreement.


5.	The making of the Total Brazil Investments by European Distribution Center Motiva BVBA in Establishment Labs Brasil Produtos Para Saude LTDA. in violation of Section 8.08 of the Existing Credit Agreement.


6.	The failure to timely provide statements, reports and notices (including board kits) made available to the Borrower’s Board of Directors or the holders of the Borrower’s Equity Interests between the Funding Date and February 19, 2018, as required by Section 7.02(e) of the Existing Credit Agreement.


7.	The failure to provide (when otherwise available) the report and opinion of an independent certified public accountant free from any “going concern” or like qualification or exception for the fiscal year ended December 31, 2017 as required by Section 7.01(a) of the Existing Credit Agreement.

SCHEDULE 1

AMENDED CREDIT AGREEMENT

See Attached.

SCHEDULE 1

CREDIT AGREEMENT

Dated as of August 24, 2017

among

ESTABLISHMENT LABS HOLDINGS INC.,

as the Borrower,

CERTAIN SUBSIDIARIES OF THE BORROWER,

as the Guarantors,

MADRYN HEALTH PARTNERS, LP,

as the Administrative Agent

and

THE LENDERS FROM TIME TO TIME PARTY HERETO

TABLE OF CONTENTS



		Page
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS		1
1.01	Defined Terms.	1
1.02	Other Interpretive Provisions.	39
1.03	Accounting Terms.	39
1.04	Times of Day.	40
1.05	Belgian Terms.	40
ARTICLE II. THE COMMITMENTS		41
2.01	Commitments.	41
2.02	Borrowings.	43
2.03	Prepayments.	43
2.04	Termination or Reduction of Commitments.	45
2.05	Repayment of Loans.	46
2.06	Interest.	49
2.07	Fees.	50
2.08	Computation of Interest.	50
2.09	Evidence of Debt.	50
2.10	Payments Generally.	50
2.11	Sharing of Payments by Lenders.	51
2.12	Defaulting Lenders.	51
2.13	Right of First Offer.	52
2.14	Term C Facility.	53
ARTICLE III. TAXES		54
3.01	Taxes.	54
3.02	Increased Costs.	56
3.03	Mitigation Obligations; Replacement of Lenders.	58
3.04	Illegality.	58
3.05	Three-Month LIBOR Unavailability Period	58
3.06	Survival	59
ARTICLE IV. GUARANTY		59
4.01	The Guaranty.	59
4.02	Obligations Unconditional.	59
4.03	Reinstatement.	60
4.04	Certain Additional Waivers.	60
4.05	Remedies.	61
4.06	Rights of Contribution.	61
4.07	Guarantee of Payment; Continuing Guarantee.	61
4.08	Limitations Applicable to Belgian Loan Parties.	61



ARTICLE V. CONDITIONS PRECEDENT TO BORROWINGS		62
5.01	Condition to Effectiveness.	62
5.02	Conditions to Initial Extensions of Credit.	62
5.03	Conditions to all Borrowings.	66
5.04	Additional Conditions to Term C Borrowing.	67
ARTICLE VI. REPRESENTATIONS AND WARRANTIES		68
6.01	Existence, Qualification and Power.	68
6.02	Authorization; No Contravention.	68
6.03	Governmental Authorization; Other Consents.	68
6.04	Binding Effect.	68
6.05	Financial Statements; No Material Adverse Effect.	69
6.06	Litigation.	69
6.07	No Default.	70
6.08	Ownership of Property; Liens.	70
6.09	Environmental Compliance.	70
6.10	Insurance.	71
6.11	Taxes.	71
6.12	ERISA Compliance.	71
6.13	Subsidiaries and Capitalization.	73
6.14	Margin Regulations; Investment Company Act.	73
6.15	Disclosure.	73
6.16	Compliance with Laws.	74
6.17	Intellectual Property; Licenses, Etc.	75
6.18	Solvency.	77
6.19	Perfection of Security Interests in the Collateral.	77
6.20	Business Locations.	77
6.21	Sanctions Concerns; Anti-Corruption Laws; PATRIOT Act; Anti-Money Laundering Laws.	78
6.22	Material Contracts.	79
6.23	Regulatory Approvals.	79
6.24	Labor Matters.	81
6.25	EEA Financial Institutions.	81
6.26	Representations as to Foreign Loan Parties.	81
6.27	Royalty and Other Payments.	82
6.28	Non-Competes.	82
6.29	Internal Controls.	82
ARTICLE VII. AFFIRMATIVE COVENANTS		83
7.01	Financial Statements.	83
7.02	Certificates; Other Information.	84
7.03	Notices.	86

iii



7.04	Payment of Obligations.	87
7.05	Preservation of Existence, Etc.	87
7.06	Maintenance of Properties	88
7.07	Maintenance of Insurance	88
7.08	Compliance with Laws.	88
7.09	Books and Records.	89
7.10	Inspection Rights.	89
7.11	Use of Proceeds.	89
7.12	Additional Subsidiaries.	90
7.13	ERISA Compliance.	90
7.14	Pledged Assets.	90
7.15	Compliance with Material Contracts.	91
7.16	Maintenance of Regulatory Approvals, Contracts, IP Rights, Etc.	91
7.17	Anti-Corruption Laws.	92
7.18	Cash Management.	92
7.19	Post-Closing Obligations.	93
7.20	Equity Issuances	93
ARTICLE VIII. NEGATIVE COVENANTS		94
8.01	Liens.	94
8.02	Investments.	96
8.03	Indebtedness.	97
8.04	Fundamental Changes.	99
8.05	Dispositions.	100
8.06	Restricted Payments.	100
8.07	Change in Nature of Business.	101
8.08	Transactions with Affiliates and Insiders.	101
8.09	Burdensome Agreements.	101
8.10	Use of Proceeds.	102
8.11	Payment of Other Indebtedness.	102
8.12	Organization Documents; Fiscal Year; Legal Name, State of Formation and Form of Entity; Certain Amendments.	102
8.13	Ownership of Subsidiaries.	103
8.14	Sale Leasebacks.	103
8.15	Sanctions; Anti-Corruption Laws.	103
8.16	Minimum Product Revenues.	103
8.17	Liquidity.	105
8.18	Modifications and Terminations of Material Contracts.	105
8.19	Inbound and Outbound Licenses.	105
ARTICLE IX. EVENTS OF DEFAULT AND REMEDIES		106
9.01	Events of Default.	106



9.02	Remedies Upon Event of Default.	109
9.03	Application of Funds.	110
ARTICLE X. ADMINISTRATIVE AGENT		110
10.01	Appointment and Authority.	110
10.02	Rights as a Lender.	111
10.03	Exculpatory Provisions.	111
10.04	Reliance by Administrative Agent.	112
10.05	Delegation of Duties.	112
10.06	Resignation of Administrative Agent.	112
10.07	Non-Reliance on Administrative Agent and Other Lenders.	113
10.08	Administrative Agent May File Proofs of Claim.	113
10.09	Collateral and Guaranty Matters.	114
ARTICLE XI. MISCELLANEOUS		115
11.01	Amendments, Etc.	115
11.02	Notices and Other Communications; Facsimile Copies.	116
11.03	No Waiver; Cumulative Remedies; Enforcement.	117
11.04	Expenses; Indemnity; and Damage Waiver.	118
11.05	Payments Set Aside.	120
11.06	Successors and Assigns.	120
11.07	Treatment of Certain Information; Confidentiality.	124
11.08	Set-off.	124
11.09	Interest Rate Limitation.	125
11.10	Counterparts; Integration; Effectiveness.	125
11.11	Survival of Representations and Warranties.	125
11.12	Severability.	126
11.13	Replacement of Lenders.	126
11.14	Governing Law; Jurisdiction; Etc.	127
11.15	Waiver of Right to Trial by Jury.	128
11.16	Electronic Execution of Assignments and Certain Other Documents.	128
11.17	USA PATRIOT Act.	128
11.18	No Advisory or Fiduciary Relationship.	129
11.19	Acknowledgement and Consent to Bail-In of EEA Financial Institutions.	129
11.20	Funding Date.	130



SCHEDULES

2.01	Commitments and Applicable Percentages
7.19	Post-Closing Obligations
11.02	Certain Addresses for Notices

EXHIBITS

A	Form of Loan Notice
B-1	Form of Term A Note
B-2	Form of Term B-1 Note
B-3	Form of Term B-2 Note
B-4	Form of Term B-3 Note
B-5	Form of Term C Note
C	Form of Joinder Agreement
D	Form of Assignment and Assumption
E	Form of Compliance Certificate

CREDIT AGREEMENT

This CREDIT AGREEMENT is entered into as of August 24, 2017 among Establishment Labs Holdings Inc., a BVI business company, limited by shares and incorporated under the laws of the British Virgin Islands (the “ Borrower ”), the Guarantors (defined herein), the Lenders (defined herein) and MADRYN HEALTH PARTNERS, LP, a Delaware limited partnership, as the Administrative Agent.

The Borrower has requested that the Lenders make term loan facilities available to the Borrower and certain equity investments in the Borrower, and the Lenders are willing to do so on the terms and conditions set forth herein.

In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

ARTICLE I.

DEFINITIONS AND ACCOUNTING TERMS


1.01	Defined Terms.

As used in this Agreement, the following terms shall have the meanings set forth below:

“ 510(k) ” means (a) any premarket notification and corresponding FDA clearance for a Device pursuant to FDA regulations and all substantially equivalent or similar notifications, applications and clearances with respect to any other non-U.S. Regulatory Authority, including the EMA, and (b) all amendments, supplements and other additions and modifications thereto, and all documents, data and information which are necessary for, filed with, incorporated by reference in or otherwise support any of the foregoing.

“ Acquisition ” means the acquisition, whether through a single transaction or a series of related transactions, of (a) a majority of the Voting Stock or other controlling ownership interest in another Person (including the purchase of an option, warrant or convertible or similar type security to acquire such a controlling interest at the time it becomes exercisable by the holder thereof), whether by purchase of such equity or other ownership interest or upon the exercise of an option or warrant for, or conversion of securities into, such equity or other ownership interest, (b) assets of another Person which constitute all or substantially all of the assets of such Person or of a division, line of business or other business unit of such Person or (c) any Product.

“ Act ” has the meaning set forth in Section 11.17 .

“ Administrative Agent ” means Madryn Health Partners, LP, in its capacity as administrative agent under any of the Loan Documents, or any successor administrative agent.

“ Administrative Agent’s Office ” means the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 11.02 or such other address or account as the Administrative Agent may from time to time notify the Loan Parties and the Lenders.

“ Affiliate ” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

“ Agreement ” means this Credit Agreement.

“ All-In-Yield ” means, with respect to any Indebtedness, the all-in-yield thereof, and taking into account the interest rate (but without duplication of any applicable interest rate floor), interest rate margin, interest rate floors, original issue discount and upfront fees paid generally to all Persons providing such Indebtedness (with original issue discount and upfront fees being equated to interest (as reasonably determined by the Administrative Agent in a manner consistent with customary financial practice) based on a four year life to maturity), but exclusive of any arrangement, structuring, underwriting or similar fee paid to any Person in connection therewith that is not shared generally with all Persons providing such Indebtedness.

“ Anti-Money Laundering Laws ” has the meaning set forth in Section 6.21(d) .

“ Applicable Foreign Loan Party Documents ” has the meaning set forth in Section 6.26(a) .

“ Applicable Margin ” means eleven percent (11%) per annum.

“ Applicable Percentage ” means, with respect to any Lender at any time, (a) in respect of the Term A Facility, with respect to any Term A Lender at any time, the percentage (carried out to the ninth decimal place) of the Term A Facility represented by (i) on or prior to the Funding Date, such Term A Lender’s Term A Commitment at such time and (ii) thereafter, the outstanding principal amount of such Term A Lender’s Term A Loans at such time, (b) in respect of the Term B-1 Facility, with respect to any Term B-1 Lender at any time, the percentage (carried out to the ninth decimal place) of the Term B-1 Facility represented by (i) at any time during the Term B-1 Availability Period, such Term B-1 Lender’s Term B-1 Commitments at such time and (ii) thereafter, the outstanding principal amount of such Term B-1 Lender’s Term B-1 Loans at such time, (c) in respect of the Term B-2 Facility, with respect to any Term B-2 Lender at any time, the percentage (carried out to the ninth decimal place) of the Term B-2 Facility represented by (i) at any time during the Term B-2 Availability Period, such Term B-2 Lender’s Term B-2 Commitments at such time and (ii) thereafter, the outstanding principal amount of such Term B-2 Lender’s Term B-2 Loans at such time, (d) in respect of the Term B-3 Facility, with respect to any Term B-3 Lender at any time, the percentage (carried out to the ninth decimal place) of the Term B-3 Facility represented by (i) at any time during the Term B-3 Availability Period, such Term B-3 Lender’s Term B-3 Commitments at such time and (ii) thereafter, the outstanding principal amount of such Term B-3 Lender’s Term B-3 Loans at such time and (e) in respect of the Term C Facility, with respect to any Term C Lender at any time, the percentage (carried out to the ninth decimal place) of the Term C Facility represented by (i) at any time after the Term C Commitments have been established pursuant to Section 2.14 , such Term C Lender’s unfunded Term C Commitment at such time plus the outstanding principal amount of such Term C Lender’s Term C Loans at such time and (ii) thereafter, the outstanding principal amount of such Term C Lender’s Term C Loans at such time. If the Commitments of all of the Lenders to make Loans have been terminated pursuant to Section 9.02 , or if the Commitments have expired, then the Applicable Percentage of each Lender in respect of the applicable Facility shall be determined based on the Applicable Percentage of such Lender in respect of such Facility most recently in effect, giving effect to any subsequent assignments. The Applicable Percentage of each Lender in respect of each Facility is set forth opposite the name of such Lender on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable.

“ Applicable Quarter ” has the meaning set forth in Section 8.16(b)(i)(A) .

“ Appropriate Lender ” means, at any time, with respect to any Facility, a Lender that has a Commitment with respect to such Facility or holds a Loan under such Facility at such time.

“ Approved Fund ” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“ Approved Strategic Investment ” means an Acquisition or Investment designated by the Borrower as an “Approved Strategic Investment,” which designation must be approved by the Administrative Agent in its sole and absolute discretion; provided , that , if the Borrower would like to designate an Acquisition or Investment as an “Approved Strategic Investment,” the Borrower shall provide written notice to the Administrative Agent to that effect (including such other documents and certificates as the Administrative Agent shall require in connection therewith) and within ten (10) Business Days after receipt thereof, the Administrative Agent shall inform the Borrower by written notice whether it approves such Acquisition or Investment as an “Approved Strategic Investment.”

“ Assignment and Assumption ” means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 11.06(b) ), and accepted by the Administrative Agent, in substantially the form of Exhibit D or any other form (including electronic documentation generated by MarkitClear or other electronic platform) approved by the Administrative Agent.

“ Attributable Indebtedness ” means, on any date, (a) in respect of any Capital Lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, (b) in respect of any Synthetic Lease of any Person, the capitalized amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a Capital Lease and (c) in respect of any Securitization Transaction of any Person, the outstanding principal amount of such financing, after taking into account reserve accounts and making appropriate adjustments, determined by the Administrative Agent in its reasonable judgment.

“ Audited Financial Statements ” means the audited consolidated balance sheet of the Borrower and its Subsidiaries for the fiscal year ended December 31, 2016, and the related consolidated statements of income or operations, shareholders’ equity and cash flows for such fiscal year of the Borrower and its Subsidiaries, including the notes thereto, audited by independent public accountants of recognized national standing and prepared in conformity with GAAP.

“ Bail-In Action ” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“ Bail-In Legislation ” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

“ Banco Davivienda ” means Banco Davivienda (Costa Rica) S.A.

“ Banco Davivienda Documents ” means, collectively, (a) that certain letter agreement dated as of May 26, 2017 between Establishment Labs Sociedad Anonima and Banco Davivienda, (b) that certain Mobile Guarantee on Inventories dated as of May 26, 2017 between Establishment Labs Sociedad Anonima and Banco Davivienda, (c) that certain Bill of Exchange dated as of May 26, 2017 executed by Establishment

Labs Sociedad Anonima in favor of Banco Davivienda and (d) all other certificates, agreements, documents and instruments related to the foregoing.

“ Belgian Companies Code ” means the Belgian Wetboek van Vennootschappen/Code des Sociétés , as amended from time to time.

“ Belgian Loan Party ” means any Loan Party that is organized under the laws of the Kingdom of Belgium.

“ Belgian Share Pledge Agreement ” means that certain share pledge agreement dated as of the Funding Date executed by the Administrative Agent, for the benefit of the Secured Parties, Establishment Labs Sociedad Anonima and the Borrower.

“ Belgian Receivables Pledge Agreement ” means that certain receivables pledge agreement dated as of the Funding Date executed by the Administrative Agent, for the benefit of the Secured Parties, and each of the Belgian Loan Parties.

“ Board of Directors ” means (a) with respect to a corporation, the board of directors of the corporation or any committee thereof duly authorized to act on behalf of such board, (b) with respect to a partnership, the Board of Directors of the general partner of the partnership, (c) with respect to a limited liability company, the managing member or members or any controlling committee of managing members thereof or if not member-managed, the managers thereof or any committee of managing members or managers thereof duly authorized to act on behalf of such Persons, and (d) with respect to any other Person, the board or committee of such Person serving a similar function.

“ Borrower ” has the meaning set forth in the introductory paragraph hereto.

“ Borrowing ” means a Term A Borrowing, a Term B-1 Borrowing, a Term B-2 Borrowing, a Term B-3 Borrowing or a Term C Borrowing, as the context may require, in each case, pursuant to Section 2.01 .

“ Brazilian Guarantor ” means any Guarantor that is organized under the laws of the Federative Republic of Brazil.

“ Brazilian Loan Party ” means any Loan Party that is organized under the laws of the Federative Republic of Brazil.

“ Brazilian Share Pledge Agreement ” means that certain quota pledge agreement dated as of the Funding Date executed by the Administrative Agent, for the benefit of the Secured Parties, each of the Brazilian Loan Parties and each Loan Party that owns Equity Interests in any Brazilian Loan Party.

“ Brazilian Receivables Pledge Agreement ” means that certain receivables pledge agreement dated as of the Funding Date executed by the Administrative Agent, for the benefit of the Secured Parties, and each of the Brazilian Loan Parties.

“ Business Day ” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Administrative Agent’s Office is located and, if such day relates to any Loan, means any such day that is also a day on which dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar market.

“ Business IP Rights ” means, at any time of determination, IP Rights owned by, licensed to, or otherwise authorized for use by any of the Loan Parties or any of their Subsidiaries at such time including, without limitation, the IP Rights listed on Schedule 6.17(b) to the Disclosure Letter.

“ Businesses ” means, at any time, a collective reference to the businesses operated by the Borrower and its Subsidiaries at such time.

“ Business Facilities ” means, at any time, a collective reference to the facilities and real properties owned, leased or operated by any Loan Party or any Subsidiary.

“ BVI Loan Party ” means any Loan Party that is organized under the laws of the British Virgin Islands.

“ Capital Lease ” means, as applied to any Person, any lease of any property by that Person as lessee which, in accordance with GAAP, is required to be accounted for as a capital lease on the balance sheet of that Person.

“ Cash Equivalents ” means any of the following types of Investments, to the extent owned by the Borrower or any of its Subsidiaries free and clear of all Liens (other than Permitted Liens):

(a) readily marketable obligations issued or directly and fully guaranteed or insured by the United States or any agency or instrumentality thereof having maturities of not more than three hundred sixty days (360) days from the date of acquisition thereof; provided , that , the full faith and credit of the United States is pledged in support thereof;

(b) time deposits with, or insured certificates of deposit or bankers’ acceptances of, any commercial bank that (i) is organized under the laws of the United States, any state thereof or the District of Columbia or is the principal banking subsidiary of a bank holding company organized under the laws of the United States, any state thereof or the District of Columbia, and is a member of the Federal Reserve System, (ii) issues (or the parent of which issues) commercial paper rated as described in clause (c) of this definition and (iii) has combined capital and surplus of at least $1,000,000,000, in each case with maturities of not more than one hundred eighty (180) days from the date of acquisition thereof;

(c) commercial paper issued by any Person organized under the laws of any state of the United States and rated at least “Prime-1” (or the then equivalent grade) by Moody’s or at least “A-1” (or the then equivalent grade) by S&P, in each case with maturities of not more than one hundred eighty (180) days from the date of acquisition thereof;

(d) Investments, classified in accordance with GAAP as current assets of the Borrower or any of its Subsidiaries, in money market investment programs registered under the Investment Company Act of 1940, which are administered by financial institutions that have the highest rating obtainable from either Moody’s or S&P, and the portfolios of which are limited solely to Investments of the character, quality and maturity described in clauses (a) , (b) and (c) of this definition;

(e) other short-term investments utilized by Foreign Subsidiaries in accordance with normal investment practices for cash management in investments of a type analogous to the foregoing; and

(f) solely with respect to any Foreign Subsidiary, non-Dollar denominated (i) certificates of deposit of, bankers acceptances of, or time deposits with, any commercial bank which

is organized and existing under the laws of the country in which such Foreign Subsidiary maintains its chief executive office and principal place of business, provided such country is (x) a member of the Organization for Economic Cooperation and Development or (y) the British Virgin Islands, the Republic of Costa Rica, or the Federative Republic of Brazil, and, in each case, whose short-term commercial paper rating is at least “Prime-1” (or the then equivalent grade) by Moody’s or at least “A-1” (or the then equivalent grade) by S&P (any such bank being an “ Approved Foreign Bank ”) and maturing within one hundred eighty (180) days of the date of acquisition and (ii) equivalents of demand deposit accounts which are maintained with an Approved Foreign Bank.

“ Change in Law ” means the occurrence, after the Effective Date, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided , that , notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “ Change in Law ”, regardless of the date enacted, adopted or issued.

“ Change of Control ” means the occurrence of any of the following events:

(a) at any time prior to a Qualifying IPO and for any reason whatsoever, the Holders shall cease to own and control, of record and beneficially, directly, (i) Equity Interests of the Borrower representing greater than fifty percent (50%) of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests of the Borrower on a fully diluted basis or (ii) Equity Interests of the Borrower representing greater than fifty percent (50%) of the aggregate equity value represented by the issued and outstanding Equity Interests of the Borrower; or

(b) at any time upon or after the consummation of a Qualifying IPO and for any reason whatsoever, any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934), other than the Holders, is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a person or group shall be deemed to have “beneficial ownership” of all securities that such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time (such right, an “option right”)), directly or indirectly, of Equity Interests representing 35% or more of the aggregate ordinary voting power in the election of the Board of Directors of the Borrower represented by the issued and outstanding Equity Interests of the Borrower on a fully diluted basis (and taking into account all such securities that such person or group has the right to acquire pursuant to any option right); or

(c) during any period of twelve (12) consecutive months, a majority of the members of the Board of Directors of the Borrower cease to be composed of individuals (i) who were members of that Board of Directors on the first day of such period, (ii) whose election, appointment or nomination to that Board of Directors was approved by individuals referred to in clause (i) above constituting at the time of such election, appointment or nomination at least a majority of that Board of Directors or (iii) whose election, appointment or nomination to that Board of Directors was

approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election, appointment or nomination at least a majority of that Board of Directors; or

(d) any “Change of Control” (or any comparable term) shall occur under any Permitted Senior Revolving Credit Document or any document or other agreement evidencing any Indebtedness with an aggregate principal amount in excess of the Threshold Amount; or

(e) except as otherwise permitted under this Agreement, the Borrower shall cease to own and control, directly or indirectly, beneficially and of record, one hundred percent (100%) of the issued and outstanding Equity Interests (other than directors’ qualifying shares or Equity Interests that are required to be held by another person in order to satisfy a foreign requirement of Law prescribing an equity owner resident in the local jurisdiction) of each of its Subsidiaries, free and clear of all Liens except Liens created by the Collateral Documents.

“ Collateral ” means a collective reference to all real and personal property (other than, for the avoidance of doubt, Excluded Property) with respect to which Liens in favor of the Administrative Agent, for the benefit of the Secured Parties, are purported to be granted pursuant to and in accordance with the terms of the Collateral Documents.

“ Collateral Access Agreement ” means an agreement in form and substance reasonably satisfactory to the Administrative Agent pursuant to which a lessor of real property on which Collateral is stored or otherwise located, or a warehouseman, processor or other bailee of inventory or other property owned by any Loan Party, acknowledges the Liens of the Administrative Agent and waives (or, if approved by the Administrative Agent, subordinates) any Liens held by such Person on such property, and permits the Administrative Agent access to any Collateral stored or otherwise located thereon.

“ Collateral Documents ” means a collective reference to the Security Agreements, the Pledge Agreements, the Qualifying Control Agreements, the Collateral Access Agreements, the Mortgages, the Real Property Security Documents and other security documents as may be executed and delivered by the Loan Parties pursuant to the terms of Section 7.14 .

“ Commitment ” means a Term A Commitment, a Term B-1 Commitment, a Term B-2 Commitment, a Term B-3 Commitment or a Term C Commitment, as the context may require.

“ Compliance Certificate ” means a certificate substantially in the form of Exhibit E .

“ Contract ” means any contract, license, lease, agreement, obligation, promise, undertaking, understanding, arrangement, document, commitment, entitlement or engagement under which a Person has, or will have, any liability or contingent liability (in each case, whether written or oral, express or implied, and whether in respect of monetary or payment obligations, performance obligations or otherwise).

“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “ Controlling ” and “ Controlled ” have meanings correlative thereto. Without limiting the generality of the foregoing, a Person shall be deemed to be Controlled by another Person if such other Person possesses, directly or indirectly, power to vote ten percent (10%) or more of the securities having ordinary voting power for the election of directors, managing general partners or the equivalent.

“ Controlled Account ” has the meaning set forth in Section 7.18(a) .

“ Controlled Investment Affiliate ” means, as to any Person, any other Person which directly or indirectly is in control of, is controlled by, or is under common control with such Person and is organized by such first Person (or any other Person controlling such first Person) primarily for making equity investments in the Borrower or any other portfolio companies in the ordinary course of business.

“ Convertible Indebtedness ” means Indebtedness having a feature which entitles the holder thereof to convert or exchange all or a portion of such Indebtedness into or by reference to Equity Interests of the Borrower.

“ Copyrights ” means, collectively, all copyrights (whether statutory or common law, whether established or registered in the United States or any other country or any political subdivision thereof, whether registered or unregistered and whether published or unpublished), all tangible embodiments of the foregoing and all copyright registrations and applications, together with any and all (a) rights and privileges arising under applicable Law and international treaties and conventions with respect to the use of such copyrights, (b) reissues, renewals, continuations and extensions thereof and amendments thereto, (c) income, fees, royalties, damages, claims and payments now or hereafter due and/or payable with respect thereto, including damages and payments for past, present or future infringements thereof, (d) rights corresponding thereto throughout the world and (e) rights to sue for past, present or future infringements thereof.

“ Costa Rican Loan Party ” means any Loan Party that is organized under the laws of the Republic of Costa Rica.

“ Costa Rican IP Security Agreement ” means the Costa Rican intellectual property pledge agreement/mobile guaranty dated as of the Funding Date executed in favor of the Administrative Agent, for the benefit of the Secured Parties, by Establishment Labs Sociedad Anonima, a Costa Rica corporation, with respect to its Costa Rican intellectual property.

“ Costa Rican Security Trust Agreement ” means that certain security trust agreement (which, for the avoidance of doubt, shall include a pledge of the Equity Interests of each Subsidiary that is organized under the laws of the Republic of Costa Rica) dated as of the Funding Date by and among the Borrower, the Administrative Agent, each of the Costa Rican Loan Parties and the Trustee, for the benefit of the Secured Parties.

“ Crown Predator ” means CPH TU, LP, a Delaware limited partnership.

“ Crown Predator Convertible Indebtedness ” means the Indebtedness owing by the Borrower to Crown Predator pursuant to that certain Note and Warrant Purchase Agreement dated as of August 28, 2015 between the Borrower and Crown Predator, as amended, modified, extended, restated, replaced or supplemented from time to time, and as evidenced by (a) that certain Amended and Restated Convertible Secured Promissory Note dated as of September 14, 2016 executed by the Borrower in favor of Crown Predator in the original principal amount of $10,000,000, (b) that certain Amended and Restated Convertible Secured Promissory Note dated as of September 14, 2016 executed by the Borrower in favor of Crown Predator in the original principal amount of $3,000,000, (c) that certain Amended and Restated Convertible Secured Promissory Note dated as of September 14, 2016 executed by the Borrower in favor of Crown Predator in the original principal amount of $5,000,000, (d) that certain Amended and Restated Convertible Secured Promissory Note dated as of September 14, 2016 executed by the Borrower in favor of Crown Predator in the original principal amount of $1,840,000 and (e) that certain Convertible Secured Promissory Note dated as of September 14, 2016 executed by the Borrower in favor of Crown Predator in the original principal amount of $4,408,076.71.

“ Cure Period ” has the meaning set forth in Section 8.16(b)(i) .

“ Cure Right ” has the meaning set forth in Section 8.16(b)(i) .

“ Debt Issuance ” means the issuance by any Loan Party or any Subsidiary of any Indebtedness other than Indebtedness permitted under Section 8.03 .

“ Debt Issuance Notice ” has the meaning set forth in Section 2.13(a) .

“ Debtor Relief Laws ” means (a) the Bankruptcy Code of the United States, (b) the Insolvency Act, 2003 of the British Virgin Islands, (c) the Commercial Code, Civil Code and Civil Procedure Code, in each case, of the Republic of Costa Rica and (d) all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States, the British Virgin Islands, the Republic of Costa Rica, the Kingdom of Belgium, the Federative Republic of Brazil or other applicable jurisdictions from time to time in effect.

“ Default ” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of time, or both, would be an Event of Default.

“ Default Rate ” has the meaning set forth in Section 2.06(b) .

“ Defaulting Lender ” means, subject to Section 2.12(b) , any Lender, as determined by the Administrative Agent, that (a) has failed to perform any of its funding obligations hereunder, including with respect to any Term B-1 Commitment, Term B-2 Commitment, Term B-3 Commitment or Term C Commitment, within three (3) Business Days of the date required to be funded by it hereunder, (b) has notified the Borrower or the Administrative Agent that it does not intend to comply with its funding obligations hereunder or (c) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or a custodian appointed for it or (iii) taken any action in furtherance of, or indicated its consent to, approval of or acquiescence in any such proceeding or appointment; provided , that , a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any Equity Interests in that Lender or any direct or indirect parent company thereof by a Governmental Authority.

“ Designated Jurisdiction ” means any country or territory to the extent that such country or territory is the subject of any Sanction.

“ Device ” means any medical instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent or other similar or related item, including any component, part or accessory, that (a) is intended for use in the diagnosis of disease, malady or other conditions or in the cure, mitigation, treatment or prevention of disease or malady, in man or other animals, or is intended to affect the structure or any function of the body of man or other animals, (b) does not achieve its primary intended purpose or purposes through chemical action within or on the body of man or other animals and (c) is not dependent upon being metabolized for the achievement of its primary intended purpose or purposes.

“ Device Clearance Application ” means any premarket approval application submitted under Section 515 of the FDCA (21 U.S.C. § 360e) (a “ PMA ”), any de novo request submitted under Section 513(f) of the FDCA (21 U.S.C. § 360c(f)), or any 510(k) submitted under Section 510(k) of the FDCA (21 U.S.C. § 360(k)) seeking clearance from the FDA for a Device that is substantially equivalent to a legally marketed predicate Device, as defined in the FDCA, or any corresponding non-U.S. application in any other non-U.S. jurisdiction,

including, with respect to the European Union, any equivalent submission to a Standard Body pursuant to an applicable directive of the European Council with respect to CE marking (or, if applicable, a self-certification of conformity with respect to any such directive through a “declaration of conformity”).

“ Disclosure Letter ” means that certain disclosure letter dated as of the Effective Date containing certain schedules delivered by the Loan Parties to the Administrative Agent (for the benefit of the Lenders) (as such schedules are supplemented from time to time in accordance with Section 7.02(a) ).

“ Disposition ” or “ Dispose ” means the sale, transfer, license, lease, issuance or other disposition (including (x) any Sale and Leaseback Transaction and (y) any issuance by any Subsidiary of its Equity Interests, but excluding any issuance by the Borrower of its Equity Interests) of any property by any Loan Party or any Subsidiary, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith, but excluding the following: (a) the sale, lease, license, transfer or other disposition of inventory in the ordinary course of business, including pursuant to exclusive distribution arrangements consistent with past practice, (b) the sale, lease, license, transfer or other disposition in the ordinary course of business of surplus, obsolete or worn out property no longer used or useful in the conduct of business of any Loan Party and its Subsidiaries, (c) any sale, lease, license, transfer or other disposition of property to any Loan Party or any Subsidiary; provided , that , (i) if the transferor of such property is a Qualified Loan Party, (A) the transferee thereof must be a Qualified Loan Party or (B) to the extent such transaction constitutes an Investment, such transaction is permitted under Section 8.02 , and (ii) if the transferor of such property is a Loan Party that is not a Qualified Loan Party, (A) the transferee thereof must be a Loan Party or (B) to the extent such transaction constitutes an Investment, such transaction is permitted under Section 8.02 , (d) granting licenses of intellectual property permitted by Section 8.19(b) , (e) any Involuntary Disposition, (f) the sale, transfer, issuance or other disposition of a de minimis number of shares of the Equity Interests of a Foreign Subsidiary in order to qualify members of the governing body of such Subsidiary if required by applicable Law, (g) the abandonment or other disposition of IP Rights that are not material and are no longer used or useful in any material respect in the business of the Borrower and its Subsidiaries, (h) licenses, sublicenses, leases or subleases (in each case, other than with respect to IP Rights or intellectual property) granted to third parties in the ordinary course of business and not interfering with the business of the Borrower and its Subsidiaries, (i) dispositions of cash and Cash Equivalents, (j) to the extent constituting Dispositions, transactions permitted by Sections 8.02 , 8.04 and 8.06 and Liens permitted by Section 8.01 , (k) discounts of or forgiveness of accounts receivable or in connection with the collection or compromise thereof, in each case, in the ordinary course of business and (l) Permitted Sale and Leaseback Transactions.

“ Disqualified Capital Stock ” means any Equity Interest which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, (a) matures (excluding any maturity as the result of an optional redemption by the issuer thereof) or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in whole or in part, prior to the one hundred eighty-first (181 ^st ) day after the Maturity Date, (b) requires the payment of any cash dividends at any time prior to the one hundred eighty-first (181 ^st ) day after the Maturity Date, (c) contains any repurchase obligation which may come into effect prior to the Facility Termination Date, or (d) is convertible into or exchangeable (unless at the sole option of the issuer thereof) for (i) debt securities or (ii) any Equity Interests referred to in clause (a) , (b) or (c) above, at any time prior to the one hundred eighty-first (181 ^st ) day after the Maturity Date; provided , that , (x) any Equity Interests that would not constitute Disqualified Capital Stock but for provisions thereof giving holders thereof (or the holders of any security into or for which such Equity Interests are convertible, exchangeable or exercisable) the right to require the issuer thereof to redeem or repurchase such Equity Interests upon the occurrence of a change in control or an asset sale occurring prior to the one hundred eighty-first (181 ^st ) day

after the Maturity Date shall not constitute Disqualified Capital Stock to the extent that such Equity Interests provide that the issuer thereof will not redeem or repurchase any such Equity Interests pursuant to such provisions prior to the Facility Termination Date and (y) only the portion of Equity Interests which so matures or is mandatorily redeemable, is so redeemable at the option of the holder thereof, has such cash dividend, has such repurchase obligation or is so convertible or exchangeable, in each case, prior to the one hundred eighty-first (181 ^st ) day after the Maturity Date will be deemed to be Disqualified Capital Stock; provided , further , however , that if such Equity Interest is issued to any current or former employee, director or consultant or to any plan for the benefit of current or former employees, directors or consultants of the Borrower or any Subsidiary or by any such plan to such current or former employees, directors or consultants such Equity Interest will not constitute Disqualified Capital Stock solely because it may be required to be repurchased by the Borrower or any Subsidiary in order to satisfy applicable statutory or regulatory obligations, including tax withholding, or as a result of such current or former employee’s, director’s or consultant’s termination, death or disability.

“ Dollar ” and “ $ ” mean lawful money of the United States.

“ Domestic Subsidiary ” means any Subsidiary that is organized under the laws of any state of the United States or the District of Columbia.

“ Earn Out Obligations ” means, with respect to an Acquisition, all obligations of the applicable Loan Party or any Subsidiary to make earn out or other contingency payments (including purchase price adjustments, non-competition and consulting agreements, or other indemnity obligations) pursuant to the documentation relating to such Acquisition. For purposes of determining the aggregate consideration paid for an Acquisition at the time of such Acquisition, the amount of any Earn Out Obligations shall be deemed to be the maximum amount of the earn-out payments in respect thereof as specified in the documents relating to such Acquisition. For purposes of determining the amount of any Earn Out Obligations to be included in the definition of Funded Indebtedness, the amount of Earn Out Obligations shall be deemed to be the aggregate liability in respect thereof, as determined in accordance with GAAP.

“ EEA Financial Institution ” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition or (c) any financial institution established in an EEA Member Country which is a Subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“ EEA Member Country ” means any of the member states of the European Union, Iceland, Liechtenstein and Norway.

“ EEA Resolution Authority ” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“ Effective Date ” means August 24, 2017.

“ Eligible Assets ” means fixed or capital assets that are used or useful in the same or a similar line of business as the Borrower and its Subsidiaries were engaged in on the Effective Date (or any reasonable extension or expansions thereof).

“ Eligible Assignee ” means any Person that meets the requirements to be an assignee under Section 11.06(b)(iii) and (v) (subject to such consents, if any, as may be required under Section 11.06(b)(iii) ).

“ EMA ” means the European Medicines Agency or any successor entity.

“ Employee Benefit Non-U.S. Plan ” means any plan, fund (including, without limitation, any superannuation fund) or other similar program established, contributed to (regardless of whether through direct contributions or through employee withholdings) or maintained outside the United States by the Borrower or any of its Subsidiaries primarily for the benefit of employees of the Borrower or any of its Subsidiaries residing outside the United States, which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement, or payments to be made upon termination of employment, and which plan is not subject to ERISA.

“ Employee Benefit Non-US Plan Event ” means (a) a failure to meet any minimum funding standards, pay any required installment or make any required contribution under any Employee Benefit Non-U.S. Plan, (b) the withdrawal or termination of any Employee Benefit Non-U.S. Plan resulting in material liability to the Borrower or any of its Subsidiaries, (c) the institution by any Governmental Authority of proceedings to terminate any Employee Benefit Non-U.S. Plan, (d) the imposition of material liability on the Borrower or any of its Subsidiaries due to the failure to comply with any applicable Law relating to any Employee Benefit Non-U.S. Plan, (e) the withdrawal by the Borrower or any of its Subsidiaries from any Employee Benefit Non-U.S. Plan resulting in material liability to the Borrower or any of its Subsidiaries, (f) any imposition by any Governmental Authority of any material tax, fine or penalty against the Borrower or any of its Subsidiaries due to the failure to comply with laws and regulations applicable to any Employee Benefit Non-U.S. Plan, (g) the assertion of any material claim against the Borrower or any of its Subsidiaries with respect to any Employee Benefit Non-U.S. Plan or (h) the imposition of any Lien on the assets of the Borrower or any of its Subsidiaries to secure obligations under any Employee Benefit Non-U.S. Plan.

“ Environmental Laws ” means any and all federal, state, provincial, territorial, local, foreign and other applicable statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment, including those related to hazardous substances or wastes, air emissions and discharges to waste or public systems.

“ Environmental Liability ” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower, any other Loan Party or any of their respective Subsidiaries directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

“ Equity Interests ” means, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member, membership or trust interests therein), whether voting or nonvoting, and

whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination; provided , however , that Equity Interests shall not include Convertible Indebtedness.

“ ERISA ” means the United States Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated thereunder from time to time.

“ ERISA Affiliate ” means any trade or business (whether or not incorporated) under common control with the Borrower within the meaning of Section 414(b) or (c) of the Internal Revenue Code (and Sections 414(m) and (o) of the Internal Revenue Code for purposes of provisions relating to Section 412 of the Internal Revenue Code).

“ ERISA Event ” means (a) a Reportable Event with respect to any Pension Plan, (b) the withdrawal of the Borrower or any ERISA Affiliate from any Pension Plan subject to Section 4063 of ERISA during a plan year in which such entity was a “substantial employer” as defined in Section 4001(a)(2) of ERISA or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA, (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan (within the meaning of Sections 4203 and 4205 of ERISA, respectively) or notification that a Multiemployer Plan is insolvent (within the meaning of Section 4245 of ERISA), (d) the filing of a notice of intent to terminate or the treatment of a Pension Plan amendment as a termination under Sections 4041 or 4041A of ERISA, (e) the institution by the PBGC of proceedings to terminate a Pension Plan, (f) any event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan, (g) the determination that any Pension Plan is considered an at-risk plan or a plan in endangered or critical status within the meaning of Sections 430, 431 and 432 of the Internal Revenue Code or Sections 303, 304 and 305 of ERISA, or (h) the imposition of any liability under Title IV of ERISA, other than for any PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower or any ERISA Affiliate with respect to any Pension Plan.

“ EU Bail-In Legislation Schedule ” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

“ Event of Default ” has the meaning set forth in Section 9.01 .

“ Exchange Act ” means the Securities Exchange Act of 1934.

“ Excluded Property ” means, with respect to any Loan Party, including any Person that becomes a Loan Party after the Effective Date as contemplated by Section 7.12 , (a) any real property which is located outside of the United States unless requested by the Administrative Agent or the Required Lenders, (b) (i) any leasehold interest of any Loan Party in real property and (ii) any fee owned real property which is subject to a Lien of the type described in Section 8.01(n) , (c) solely with respect to any U.S. Loan Party, any personal property (including, without limitation, motor vehicles) of such U.S. Loan Party in respect of which perfection of a Lien is not either (i) governed by the Uniform Commercial Code or (ii) effected by appropriate evidence of the Lien being filed in either the United States Copyright Office or the United States Patent and Trademark Office, unless requested by the Administrative Agent or the Required Lenders, (d) any property which, subject to the terms of Section 8.09 , is subject to a Lien of the type described in Section 8.01(i) pursuant to documents which prohibit such Loan Party from granting any other Liens in such property, (e) any United States intent-to-use trademark or service mark application to the extent that, and solely during the period in which, the grant of a security interest therein would impair the validity or enforceability of such intent-to-use trademark or service mark application under federal law, (f) any Equity Interests in any Person that is not a Wholly Owned Subsidiary of a Loan Party, to the extent that the granting of a Lien thereon, or a security interest therein, is prohibited or requires the consent of another Person (that is not the Borrower or any Affiliate

thereof), in each case, pursuant to the Organization Documents of such Person that is not a Wholly Owned Subsidiary; provided , that , in the event of the termination or elimination of any such prohibition or requirement for consent, to the extent sufficient to permit any such Equity Interests to become Collateral, or upon the granting of any such consent, or waiving or terminating any requirement for such consent, a security interest in such Equity Interests shall be automatically and simultaneously granted under the applicable Collateral Document and such Equity Interests shall be included as Collateral, (g) solely with respect to any U.S. Loan Party, any General Intangible (as defined in the Uniform Commercial Code), permit, lease, license, contract or other Instrument (as defined in the Uniform Commercial Code) of such U.S. Loan Party to the extent the grant of a security interest in such General Intangible (as defined in the Uniform Commercial Code), permit, lease, license, contract or other Instrument (as defined in the Uniform Commercial Code) in the manner contemplated by the Collateral Documents, under the terms thereof or under applicable Law, is prohibited and would result in the termination thereof or give the other parties thereto the right to terminate, accelerate or otherwise alter such U.S. Loan Party’s rights, titles and interests thereunder (including upon the giving of notice or the lapse of time or both); provided , that , (i) any such limitation described in this clause (g) on the security interests granted under the Collateral Documents shall only apply to the extent that any such prohibition or right to terminate or accelerate or alter a U.S. Loan Party’s rights could not be rendered ineffective pursuant to the Uniform Commercial Code or any other applicable Law or principles of equity and (ii) in the event of the termination or elimination of any such prohibition or right or the requirement for any consent contained in any applicable Law, General Intangible (as defined in the Uniform Commercial Code), permit, lease, license, contract or other Instrument (as defined in the Uniform Commercial Code), to the extent sufficient to permit any such item to become Collateral, or upon the granting of any such consent, or waiving or terminating any requirement for such consent, a security interest in such General Intangible (as defined in the Uniform Commercial Code), permit, lease, license, contract or other Instrument (as defined in the Uniform Commercial Code) shall be automatically and simultaneously granted under the applicable Collateral Documents and such items shall be included as Collateral, (h) assets to the extent that pledges thereof, and security interests therein, are prohibited by applicable Law; provided , that , (i) any such limitation described in this clause (h) on the security interests granted under the Collateral Documents shall only apply to the extent that any such prohibition could not be rendered ineffective pursuant to the Uniform Commercial Code or any other applicable Law or principles of equity and (ii) in the event of the termination or elimination of any such prohibition contained in any applicable Law, a security interest in such assets shall be automatically and simultaneously granted under the applicable Collateral Documents and such assets shall be included as Collateral and (i) any real or personal property as to which (i) the Administrative Agent and the Borrower agree in writing that the costs or other consequences of obtaining a security interest or perfection thereof are excessive in view of the benefits to be obtained by the Secured Parties therefrom or (ii) the Administrative Agent and the Borrower agree in writing that obtaining a security interest or perfection thereof would result in material adverse tax consequences to the Borrower or its Subsidiaries.

“ Excluded Subsidiary ” means (a) any Foreign Subsidiary, the perfected grant of a security interest in the assets of such Subsidiary in support of, and the guaranteeing of, the Obligations (i) would be prohibited by applicable Law in the jurisdiction of formation or incorporation of such Subsidiary (as reasonably determined by the Borrower with the consent of the Administrative Agent) or (ii) would result in material adverse tax consequences to the Borrower or its Subsidiaries (as reasonably determined by the Borrower with the consent of the Administrative Agent), (b) any other Foreign Subsidiary with respect to which (in the reasonable judgment of the Administrative Agent), the cost or other consequences of such Foreign Subsidiary guaranteeing the Obligations are excessive in view of the benefits to be obtained by the Secured Parties therefrom or (c) any Immaterial Subsidiary.

“ Exclusivity Period ” has the meaning set forth in Section 2.13(b) .

“ Existing Credit Agreement ” means that certain Credit Agreement and Guaranty dated as of September 19, 2016 by and among the Borrower, certain of the Borrower’s subsidiaries from time to time party thereto and the lenders from time to time party thereto, as amended or modified from time to time.

“ Extraordinary Receipts ” means any cash received by or paid to or for the account of any Person not in the ordinary course of business, including tax refunds, pension plan reversions, proceeds of insurance (other than proceeds of business interruption insurance to the extent such proceeds constitute compensation for lost earnings), condemnation awards (and payments in lieu thereof), indemnity payments and any purchase price adjustments; provided , that , “Extraordinary Receipts” shall not include (x) cash payments received by or paid to or for the account of any Loan Party pursuant to a judgment, claim (including an insurance claim), settlement, cause of action or indemnification claim, to the extent such payments are in respect of any obligations owed by such Loan Party to a third party that is not an Affiliate of a Loan Party with respect to the underlying claim for which such judgment, claim, settlement, cause of action or indemnification claim arose and are applied to pay (or reimburse such Loan Party for payment on account of) such obligations and (y) any purchase price adjustment (other than working capital purchase price adjustments) pursuant to any acquisition agreement entered into after the Effective Date in connection with a Permitted Acquisition to the extent that the purchase price of such Permitted Acquisition was paid solely with Qualified Capital Stock or with the proceeds from the issuance of Qualified Capital Stock by the Borrower or a capital contribution to the Borrower.

“ Facility ” means the Term A Facility, the Term B-1 Facility, the Term B-2 Facility, the Term B-3 Facility or the Term C Facility, as the context may require.

“ Facility Termination Date ” means the date as of which all of the following shall have occurred: (a) all of the Commitments have terminated and (b) all Obligations have been paid in full in cash (other than contingent indemnification obligations for which no claim has been asserted).

“ FATCA ” means Sections 1471 through 1474 of the Internal Revenue Code as of the Effective Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations thereunder, official interpretations thereof, any agreement entered into pursuant to Section 1471(b)(1) of the Internal Revenue Code and any intergovernmental agreements entered into thereunder.

“ FDA ” means the U.S. Food and Drug Administration and any successor entity.

“ FDCA ” means the U.S. Food, Drug and Cosmetic Act of 1938 (or any successor thereto), as amended from time to time, and the rules, regulations, guidelines, guidance documents and compliance policy guides issued or promulgated thereunder.

“ Federal Funds Rate ” means, for any day, the rate per annum equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided , that , if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day. Notwithstanding the foregoing, if the Federal Funds Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement

“ Fee Letter ” means that certain letter agreement dated as of the Funding Date, by and among the Borrower and the Administrative Agent.

“ Flood Hazard Property ” has the meaning set forth in the definition of “Real Property Security Documents”.

“ Foreign Lender ” has the meaning set forth in Section 3.01(c)(ii) .

“ Foreign Loan Party ” means each Loan Party that is not a U.S. Loan Party.

“ Foreign Subsidiary ” means any Subsidiary that is not a Domestic Subsidiary.

“ FRB ” means the Board of Governors of the Federal Reserve System of the United States.

“ Fund ” means any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.

“ Funded Indebtedness ” means, as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

(a) all obligations, whether current or long-term, for borrowed money (including the Obligations) and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;

(b) all purchase money Indebtedness;

(c) the principal portion of all obligations under conditional sale or other title retention agreements relating to property purchased by such Person or any Subsidiary thereof (other than customary reservations or retentions of title under agreements with suppliers entered into in the ordinary course of business);

(d) all obligations arising under letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar instruments;

(e) all obligations in respect of the deferred purchase price of property or services (other than (x) trade accounts payable in the ordinary course of business and (y) obligations under deferred compensation plans), including, without limitation, any Earn Out Obligations;

(f) the Attributable Indebtedness of Capital Leases, Securitization Transactions and Synthetic Leases;

(g) all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Disqualified Capital Stock in such Person or any other Person, valued, in the case of a redeemable preferred interest, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends;

(h) all Funded Indebtedness of others secured by (or for which the holder of such Funded Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on, or payable out of the proceeds of production from, property owned or acquired by such Person, whether or not the obligations secured thereby have been assumed;

(i) all Guarantees with respect to Funded Indebtedness of the types specified in clauses (a) through (h) above of another Person; and

(j) all Funded Indebtedness of the types referred to in clauses (a) through (i) above of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or joint venturer, except to the extent that Funded Indebtedness is expressly made non-recourse to such Person.

For purposes hereof, the amount of any direct obligation arising under letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar instruments shall be the maximum amount available to be drawn thereunder.

“ Funding Date ” means the date on which the conditions set forth in Section 5.02 have been satisfied.

“ GAAP ” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board, consistently applied and as in effect from time to time.

“ Governmental Approval ” means any consent, authorization, approval, order, license, franchise, permit, certification, accreditation, registration, clearance, exemption, filing or notice that is issued or granted by or from (or pursuant to any act of) or required by any Governmental Authority, including any application or submission related to any of the foregoing.

“ Governmental Authority ” means the government of the United States, the British Virgin Islands, the Kingdom of Belgium, the Republic of Costa Rica, the Federative Republic of Brazil or any other nation, or of any political subdivision thereof, whether state, provincial, territorial or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“ Guarantee ” means, as to any Person, (a) any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation payable or performable by another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other obligation of the payment or performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien). The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a corresponding meaning.

“ Guarantors ” means (a) each Subsidiary identified as a “Guarantor” on the signature pages hereto and (b) each other Person that joins as a Guarantor pursuant to Section 7.12 , together with their successors and permitted assigns; provided , that , in no event shall any Excluded Subsidiary be a Guarantor.

“ Guaranty ” means the Guaranty made by the Guarantors in favor of the Secured Parties pursuant to Article IV .

“ Hazardous Materials ” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

“ Healthcare Laws ” means, collectively, all Laws applicable to the business of any Loan Party regulating the manufacturing, labeling, promotion and provision of and payment for healthcare products, items and services, including the Health Insurance Portability and Accountability Act of 1996, Section 1128B(b) of the Social Security Act, as amended; 42 U.S.C. § 1320a-7b (Criminal Penalties Involving Medicare or State Health Care Programs), commonly referred to as the “Federal Anti-Kickback Statute;” Section 1877 of the Social Security Act, as amended and similar state laws; 42 U.S.C. § 1395nn (Limitation on Certain Physician Referrals), commonly referred to as “Stark Statute;” U.S. Federal Food, Drug, and Cosmetic Act, as amended from time to time (21 U.S.C. § 301 et seq.); all applicable Good Manufacturing Practice requirements addressed in the FDA’s Quality System Regulation (21 C.F.R. Part 820); the Medical Devices Regulations, 21 C.F.R. Part 812, and Parts 50, 54, and 56; all applicable labeling requirements addressed in the FDA’s Device Labeling Regulation (21 C.F.R. Part 801); all regulations with respect to the provision of Medicare and Medicaid programs and services (42 C.F.R. Chapter IV et seq.); and all regulations promulgated under or pursuant to any of the foregoing.

“ HMT ” has the meaning set forth in the definition of “Sanctions”.

“ Holders ” means, collectively, (a) the Persons set forth on Schedule 1.01(b) to the Disclosure Letter, (b) each natural relative who is a rightful heir of any of the foregoing holders described in clause (a) of this definition, (c) any trust maintained by or for the benefit of any of the foregoing holders and rightful heirs described in clauses (a) or (b) of this definition and (d) each Controlled Investment Affiliate of any holder specified in clause (a) of this definition.

“ IDE ” means an application, including an application filed with any Regulatory Authority, for authorization to commence human clinical studies with respect to any Device, including (a) an Investigational Device Exemption as defined in the FDCA or any successor application or procedure filed with the FDA, (b) an abbreviated Investigational Device Exemption as specified in FDA regulations in 21 C.F.R. § 812.2(b), (c) any equivalent of any of the foregoing pursuant to or under any non-U.S. country or regulatory jurisdiction, (d) all amendments, variations, extensions and renewals of any of the foregoing that may be filed with respect thereto and (e) all documents and correspondence with Institutional Review Boards, whether U.S. or non-U.S., or equivalent.

“ Immaterial Subsidiary ” means any Subsidiary that, as of any date of determination (a) for the four consecutive fiscal quarter period most recently ended prior to such date for which financial statements have been delivered to the Administrative Agent pursuant to Sections 7.01(a)(i) or (b) , did not (together with its Subsidiaries) (i) generate Product Revenues in excess of five percent (5%) of Product Revenues (for the avoidance of doubt, for the Borrower and its Subsidiaries on a consolidated basis) for such four consecutive fiscal quarter period or (ii) together with all other Immaterial Subsidiaries at such time, generate Product Revenues in excess of ten percent (10%) of Product Revenues (for the avoidance of doubt, for the Borrower

and its Subsidiaries on a consolidated basis) for such four consecutive fiscal quarter period and (b) did not have (together with its Subsidiaries) (i) total assets in excess of five percent (5%) of the consolidated total assets of the Borrower and its Subsidiaries at such date or (ii) together with all other Immaterial Subsidiaries at such time, total assets in excess of ten percent (10%) of consolidated total assets of the Borrower and its Subsidiaries at such date; provided , that , notwithstanding anything herein to the contrary, (x) in no event shall any Subsidiary that owns material Business IP Rights be deemed to be an Immaterial Subsidiary and (y) in no event shall any Subsidiary that has become a Guarantor in accordance with the terms of this Agreement be deemed to be an Immaterial Subsidiary.

“ Indebtedness ” means, as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

(a) all Funded Indebtedness;

(b) the Swap Termination Value of any Swap Contract;

(c) all Guarantees with respect to outstanding Indebtedness of the types specified in clauses (a) and (b) above of any other Person; and

(d) all Indebtedness of the types referred to in clauses (a) through (c) above of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person or a Subsidiary thereof is a general partner or joint venturer, unless such Indebtedness is expressly made non-recourse to such Person or such Subsidiary.

“ Indemnitee ” has the meaning set forth in Section 11.04(b) .

“ Information ” has the meaning set forth in Section 11.07 .

“ Interest Payment Date ” means, (a) the last day of each March, June, September and December; provided , that , if any such last day is not a Business Day, the applicable “Interest Payment Date” shall be the first Business Day immediately preceding such last day of such month; and (b) the Maturity Date.

“ Interest Period ” means, with respect to any Loan, (a) the period commencing on (and including) the applicable borrowing date of such Loan and ending on (and including) the last day of the calendar quarter in which such borrowing date occurs; provided , that , if any such last day is not a Business Day, the applicable Interest Period shall end on the first Business Day immediately preceding such last day of such quarter, and (b) thereafter, the period beginning on (and including) the first day following the end of the preceding Interest Period and ending on the earlier of (and including) (x) the last day of the calendar quarter following the calendar quarter in which the preceding Interest Period ended; provided , that , if any such last day is not a Business Day, the applicable Interest Period shall end on the first Business Day immediately preceding such last day of such quarter, and (y) the Maturity Date. Notwithstanding the foregoing, each Interest Period in effect as of the Second Amendment Effective Date shall end on (and include) the last day of the calendar quarter in which the Second Amendment Effective Date occurs; provided , that , if such last day is not a Business Day, each applicable Interest Period shall end on the first Business Day immediately preceding such last day of such quarter.

“ Interest Rate ” means, for any Interest Period, the sum of (a) the Applicable Margin plus (b) Three-Month LIBOR for such Interest Period; provided , that , at all times when a LIBOR Unavailability Period shall exist and be continuing, the “Interest Rate” shall equal the sum of (i) the total of (x) the Applicable Margin minus (y) one percent (1.00%) plus (ii) the Prime Rate.

“ Interim Financial Statements ” means the unaudited consolidated financial statements of the Borrower and its Subsidiaries for the fiscal quarter ended March 31, 2017, including balance sheets and statements of income or operations, shareholders’ equity and cash flows.

“ Internal Revenue Code ” means the United States Internal Revenue Code of 1986.

“ Internal Revenue Service ” means the United States Internal Revenue Service.

“ Invention ” means any novel, inventive or useful art, apparatus, method, process, machine (including any article or Device), manufacture or composition of matter, or any novel, inventive and useful improvement in any art, method, process, machine (including article or Device), manufacture or composition of matter.

“ Investment ” means, as to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) the purchase or other acquisition of Equity Interests of another Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of debt of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which the investor Guarantees Indebtedness of such other Person or (c) an Acquisition. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.

“ Investment Documents ” means, collectively, the Loan Documents, the Share Purchase Agreement and the ROFR Side Letter.

“ Involuntary Disposition ” means any loss of, damage to or destruction of, or any condemnation or other taking for public use of, any property of any Loan Party or any of its Subsidiaries.

“ IP Rights ” means all Patents, Trademarks, Copyrights and Technical Information, whether registered or not, U.S. or non-U.S., Device Clearance Applications, Product Agreements, Product Authorizations or Regulatory Approvals, including (without limitation) all of the following:

(a) applications or registrations relating to such IP Rights;

(b) rights and privileges arising under any applicable Law with respect to such IP Rights;

(d) rights of the same or similar effect or nature in any jurisdiction corresponding to such IP Rights throughout the world.

“ Joinder Agreement ” means a joinder agreement substantially in the form of Exhibit C executed and delivered by a Subsidiary in accordance with the provisions of Section 7.12 .

“ JW Opportunities Warrant ” means that certain Warrant Certificate dated as of September 30, 2016 issued by the Borrower in favor of JW Opportunities Master Fund, Ltd.

“ JW Partners Warrant ” means that certain Warrant Certificate dated as of September 30, 2016 issued by the Borrower in favor of JW Partners, LP.

“ Key Person ” means Juan José Chacón Quirós.

“ Key Person Event ” means that the Key Person at any time prior to a Qualifying IPO (a) (i) fails to hold the office of the Chief Executive Officer of the Borrower or fails to possess the power and authority typically associated with individuals holding the office of Chief Executive Officer, (ii) fails to be directly and actively involved in the day to day management and direction of the Borrower and its Subsidiaries or (iii) is not devoting his full working time and efforts to the business and affairs of the Borrower and its Subsidiaries and (b) an interim or permanent replacement for the Key Person is not approved by the Borrower’s Board of Directors (and approved by the Administrative Agent (such approval not to be unreasonably withheld, conditioned or delayed)) within one hundred twenty (120) days of the applicable failure described in the foregoing clause (a) ; provided , that , the Key Person may manage his personal investments and may engage in civic, educational, religious, charitable or other community activities, as long as such activities do not pose an actual or apparent conflict of interest and do not materially interfere with the Key Person’s performance of his full-time duties as Chief Executive Officer.

“ Laws ” means, collectively, all international, foreign, federal, state, provincial, territorial and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof or determinations thereunder by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case having the force of law.

“ Lenders ” means each of the Persons identified as a “Lender” on the signature pages hereto and their respective successors and assigns.

“ Lending Office ” means, as to any Lender, the office address of such Lender and, as appropriate, account of such Lender set forth on Schedule 11.02 or such other address or account as such Lender may from time to time notify the Borrower and the Administrative Agent.

“ LIBOR Screen Rate ” has the meaning set forth in the definition of “Three-Month LIBOR”.

“ LIBOR Successor Rate ” has the meaning set forth in Section 3.05 .

“ LIBOR Successor Rate Conforming Changes ” means, with respect to any proposed LIBOR Successor Rate, any conforming changes to the definition of Interest Period, Interest Rate or Three-Month LIBOR, the timing and frequency of determining rates and making payments of interest and other administrative matters as may be appropriate, in the discretion of the Administrative Agent, to reflect the adoption of such LIBOR Successor Rate and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent determines that adoption of any portion of such market practice is not administratively feasible or that no market practice for the administration of such LIBOR Successor Rate exists, in such other manner of administration as the Administrative Agent determines in consultation with the Borrower).

“ LIBOR Unavailability Period ” means a period, commencing on the date on which any of the events set forth in clauses (a) , (b) , (c) or (d) below occur and continuing through the earlier to occur of (x) the date on which no such conditions continue to exist and (y) the date on which a LIBOR Successor Rate is established:

(a) adequate and reasonable means do not exist for ascertaining the LIBOR Screen Rate, including, without limitation, because the LIBOR Screen Rate is not available or published on a current basis and such circumstances are unlikely to be temporary, or

(b) the administrator of the LIBOR Screen Rate or a Governmental Authority having jurisdiction over the Administrative Agent has made a public statement identifying a specific date after which the LIBOR Screen Rate shall no longer be made available, or used for determining the interest rate of loans, or

(c) loans currently being executed, or that include language similar to that contained in this definition and Section 3.05 , are being executed or amended (as applicable) to incorporate or adopt a new benchmark interest rate to replace the LIBOR Screen Rate, or

(d) for any reason the LIBOR Screen Rate with respect to any Loan does not adequately and fairly reflect the cost to the Lenders of funding such Loan.

“ Lien ” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real property, and any financing lease having substantially the same economic effect as any of the foregoing).

“ Liquidity ” means, as of any date, an amount equal to Unrestricted Cash as of such date.

“ Loan ” means an extension of credit by a Lender to the Borrower under Article II in the form of a Term A Loan, a Term B-1 Loan, a Term B-2 Loan, a Term B-3 Loan or a Term C Loan.

“ Loan Documents ” means this Agreement, each Note, each Joinder Agreement (or such other documents as the Administrative Agent shall reasonably request pursuant to Section 7.12 for such purpose), each Collateral Document, the Disclosure Letter, the Fee Letter, any intercreditor agreement entered into in connection with Permitted Senior Revolving Credit Indebtedness, each agreement entered into in accordance with the terms of Section 2.14 and any other agreement, instrument or document designated by its terms as a “Loan Document”; provided , that , for the avoidance of doubt, the Share Purchase Agreement, the ROFR Side Letter and any document related to the Share Purchase Agreement or the ROFR Side Letter (for the avoidance of doubt, other than any document described in the text preceding this proviso), in each case, shall not be “Loan Documents”.

“ Loan Notice ” means a notice of a Borrowing of Loans pursuant to Section 2.02(a) , which shall be substantially in the form of Exhibit A .

“ Loan Parties ” means, collectively, the Borrower and each Guarantor.

“ Master Agreement ” has the meaning set forth in the definition of “Swap Contract”.

“ Material Adverse Effect ” means (a) a material adverse change in, or a material adverse effect upon, the business, financial performance or condition, operations (including the financial results thereof), assets or properties of the Borrower and its Subsidiaries taken as a whole, (b) a material impairment of the rights and remedies of the Administrative Agent or any Lender under any Loan Document to which it is a party or a material impairment in the perfection, value or priority of the Administrative Agent’s security interests in the Collateral, (c) an impairment of the ability of any Loan Party to perform its material obligations under any Loan Document to which it is a party or (d) a material adverse effect upon the legality, validity, binding effect or enforceability against any Loan Party of any Loan Document to which it is a party.

“ Material Contracts ” means all (a) employment agreements covering the management of any Loan Party or any Subsidiary, (b) collective bargaining agreements or other labor agreements covering any employees of any Loan Party or any Subsidiary, (c) agreements for managerial, consulting or similar services to which any Loan Party or any Subsidiary is a party or by which it is bound, (d) agreements regarding any Loan Party or any Subsidiary, its assets or operations or any investment therein to which any of its equityholders is a party or by which it is bound, (e) real estate leases, licenses of IP Rights or other lease or license agreements to which any Loan Party or any Subsidiary is a party, either as lessor or lessee, or as licensor or licensee (other than licenses arising from the purchase of “off the shelf” products), (f) customer, sales, distribution or supply agreements to which any Loan Party or any Subsidiary is a party, in each case with respect to the preceding clauses (a) , (c) , (d) and (e) requiring payment of more than $500,000 in any year, and with respect to the preceding clause (f) , requiring payment of more than $750,000 in any year, (g) any other Contract to which any Loan Party or any Subsidiary is a party that (i) relates to any Product or any Product Commercialization and Development Activity and (ii) is reasonably expected to (A) result in payments or receipts (including royalty, licensing or similar payments) made to any Loan Party or any of its Subsidiaries in an aggregate amount in excess of $750,000 in any period of twelve (12) consecutive months or (B) require payments or expenditures (including royalty, licensing or similar payments) made by any Loan Party or any of its Subsidiaries in an aggregate amount in excess of $750,000 in any period of twelve (12) consecutive months or (h) any other agreements or instruments to which any Loan Party or any Subsidiary is a party, and the breach, nonperformance, termination or cancellation of which, or the failure of which to renew, could reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect.

“ Material IP Rights ” means all Business IP Rights, whether owned or licensed as of the Effective Date, or acquired, developed or otherwise licensed or obtained by a Loan Party or any of their respective Subsidiaries after the Effective Date (x) the loss of which could reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect or (y) that has a fair market value in excess of $750,000.

“ Maturity Date ” means June 30, 2023; provided , that , if such date is not a Business Day, the Maturity Date shall be the first Business Day immediately preceding such date.

“ Maximum Rate ” has the meaning set forth in Section 11.09 .

“ Moody’s ” means Moody’s Investors Service, Inc. and any successor thereto.

“ Mortgages ” means the mortgages, deeds of trust or deeds to secure debt that purport to grant to the Administrative Agent, for the benefit of the Secured Parties, a security interest in the fee interest of any Loan Party in real property (other than Excluded Property).

“ Multiemployer Plan ” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

“ Multiple Employer Plan ” means any Plan which has two or more contributing sponsors (including the Borrower or any ERISA Affiliate) at least two of whom are not under common control, as such a plan is described in Section 4064 of ERISA.

“ Net Cash Proceeds ” means the aggregate cash or Cash Equivalents proceeds received by any Loan Party or any Subsidiary in respect of any Disposition, Debt Issuance, Involuntary Disposition or Extraordinary Receipts, net of (a) reasonable direct costs incurred in connection therewith (including, without limitation, legal, accounting and investment banking fees, and sales commissions), (b) taxes paid or payable as a result

thereof, (c) in the case of any Disposition, the amount necessary to retire any Indebtedness secured by a Permitted Lien (ranking senior to any Lien of the Administrative Agent) on the related property and (d) in the case of any Extraordinary Receipt consisting of insurance and condemnation proceeds, such proceeds to the extent applied to the repair or replacement of the applicable property within one (1) year after receipt thereof; it being understood that “Net Cash Proceeds” shall include, without limitation, any cash or Cash Equivalents received upon the sale or other disposition of any non-cash consideration received by any Loan Party or any Subsidiary in any Disposition, Debt Issuance, Involuntary Disposition or Extraordinary Receipt.

“ Non-Consenting Lender ” means any Lender that does not approve any consent, waiver or amendment that (a) requires the approval of all Lenders or all affected Lenders in accordance with the terms of Section 11.01 and (b) has been approved by the Required Lenders.

“ Note ” or “ Notes ” means the Term A Notes, the Term B-1 Notes, the Term B-2 Notes, the Term B-3 Notes or the Term C Notes, individually or collectively, as appropriate.

“ Obligations ” means (a) all advances to, and all debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan and (b) all costs and expenses incurred in connection with enforcement and collection of the foregoing, including the fees, charges and disbursements of counsel, in each case whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate thereof pursuant to any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.

“ OFAC ” means the Office of Foreign Assets Control of the United States Department of the Treasury.

“ Organization Documents ” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction), (b) with respect to any BVI business company, the certificate of incorporation and the memorandum and articles of association of such company, (c) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement or limited liability company agreement (or equivalent or comparable documents with respect to any non-U.S. jurisdiction), and (d) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

“ Outstanding Amount ” means with respect to any Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of any Loans occurring on such date.

“ Participant ” has the meaning set forth in Section 11.06(d) .

“ Patents ” means, collectively, all patents and all patent applications and registrations (whether issued, established or registered or recorded in the United States or any other country or any political subdivision thereof) and all tangible embodiments of the foregoing, together with any and all (a) rights and privileges arising under applicable Law and international treaties and conventions with respect to the use of any patents, (b) Inventions and improvements described and claimed therein, (c) reissues, divisions, continuations, renewals, extensions and continuations-in-part thereof and amendments thereto, (d) income, fees, royalties,

damages, claims and payments now or hereafter due and/or payable thereunder and with respect thereto including damages and payments for past, present or future infringements thereof, (e) rights corresponding thereto throughout the world and (f) rights to sue for past, present or future infringements thereof.

“ PBGC ” means the Pension Benefit Guaranty Corporation or any successor thereto.

“ Pension Funding Rules ” means the rules of the Internal Revenue Code and ERISA regarding minimum required contributions (including any installment payment thereof) to Pension Plans and set forth in Sections 412, 430, 431, 432 and 436 of the Internal Revenue Code and Sections 302, 303, 304 and 305 of ERISA.

“ Pension Plan ” means any employee pension benefit plan (including a Multiple Employer Plan or a Multiemployer Plan) that is maintained or is contributed to by the Borrower and any ERISA Affiliate and is either covered by Title IV of ERISA or is subject to minimum funding standards under Section 412 of the Internal Revenue Code.

“ Perceptive Warrant ” means that certain Warrant Certificate dated as of September 30, 2016 issued by the Borrower in favor of Perceptive Credit Holdings, LP.

“ Permitted Acquisition ” means an Investment consisting of an Acquisition by a Loan Party whether by purchase, merger or otherwise (whether in one or a series of related transactions); provided , that :

(a) immediately prior to, and after giving effect thereto, no Default or Event of Default shall have occurred and be continuing or would reasonably be expected to result therefrom;

(b) all transactions in connection therewith shall be consummated, in all material respects, in accordance with all applicable Law and in conformity with all applicable governmental, shareholder and third party consents and approvals;

(c) in the case of an acquisition of Equity Interests of another Person, all of such Equity Interests shall be owned one hundred percent (100%) by such Loan Party or a Wholly Owned Subsidiary of such Loan Party, and such Loan Party shall take, or cause to be taken, each of the actions set forth in Section 7.12 and Section 7.14 , if applicable, within the applicable time periods set forth therein;

(d) in the case of the Acquisition of assets, all assets acquired shall be owned by a Loan Party and such Loan Party shall take, or cause to be taken, within the time periods set forth in Section 7.14 and/or in the Collateral Documents, all necessary actions to comply with Section 7.14(b) ;

(e) such acquired Person (in the case of an Acquisition of Equity Interests) or assets (in the case of an Acquisition of assets, a Product or a line of business or division) (i) shall be engaged or used, as the case may be, in (A) a similar or reasonably related business or line of business or (B) a business or line of business that is reasonably related or similar to those in which the Loan Parties and their respective Subsidiaries are engaged as of the Effective Date or (ii) shall have a reasonably related or similar customer base as the Loan Parties and their respective Subsidiaries;

(f) on a Pro Forma Basis after giving effect to such Acquisition, the Loan Parties and their respective Subsidiaries shall be in compliance with the financial covenants set forth in Sections 8.16 and 8.17 as of the last day of the four fiscal quarter period most recently ended for which

financial statements have been delivered to the Administrative Agent pursuant to Section 7.01(a)(i) or (b) ;

(g) in the case of an Acquisition of the Equity Interests of another Person, the Board of Directors of such other Person shall have duly approved such Acquisition;

(h) the purchase price (or equivalent consideration) for such Acquisition shall be paid only in cash or Qualified Capital Stock of the Borrower and (i) to the extent such purchase price is paid in cash, when taken together with all other Acquisitions consummated or effected for cash consideration since the Effective Date, does not exceed $2,000,000 in the aggregate, or (ii) to the extent such purchase price is paid in Qualified Capital Stock of the Borrower, when taken together with all other Acquisitions consummated or effected for Qualified Capital Stock consideration since the Effective Date, does not exceed the fair market value of $5,000,000 (with fair market value being determined in good faith by the Borrower’s Board of Directors at the time of the applicable Acquisition) in the aggregate; and

(i) the Loan Parties shall have provided the Administrative Agent with at least ten (10) Business Days’ prior written notice of any such Acquisition, together with summaries, prepared in reasonable detail, of all due diligence conducted by or on behalf of the Loan Parties or their respective Subsidiaries, as applicable, prior to such Acquisition, and the Administrative Agent shall have received a certificate of a Responsible Officer of the Borrower (prepared in reasonable detail) disclosing the Borrower’s reasonable, good faith belief as to any contingent liabilities and prospective research and development costs associated with the Person or assets being acquired.

“ Permitted Liens ” means, at any time, Liens in respect of property of any Loan Party or any of its Subsidiaries permitted to exist at such time pursuant to the terms of Section 8.01 .

“ Permitted Refinancing ” means, with respect to any Indebtedness, any extensions, renewals and replacements of such Indebtedness; provided , that , such extension, renewal or replacement (a) shall not increase the outstanding principal amount of such Indebtedness (other than by the aggregate amount of any fees and expenses incurred in connection with such refinancing and any reasonable premium paid in connection with such refinancing), (b) contains terms relating to outstanding principal amount, amortization, maturity, collateral (if any) and subordination (if any), and other material terms taken as a whole no less favorable in any material respect to the Loan Parties and their respective Subsidiaries or the Secured Parties than the terms of any agreement or instrument governing such existing Indebtedness, (c) shall have an applicable interest rate or equivalent yield which does not exceed the interest rate or equivalent yield of the Indebtedness being extended, renewed or replaced, (d) shall not contain any new requirement to grant any Lien or to give any Guarantee that was not an existing requirement of the Indebtedness being extended, renewed or replaced and (e) after giving effect to such extension, renewal or replacement, no Default or Event of Default shall have occurred (or would reasonably be expected to occur) as a result thereof.

“ Permitted Sale and Leaseback Transaction ” means, with respect to any Loan Party or any Subsidiary, any Sale and Leaseback Transaction whereby such Loan Party or such Subsidiary shall sell fixed assets to any Person and thereafter rent or lease such fixed assets for the same or a similar purpose, in each case, entered into in connection with the incurrence by such Loan Party or Subsidiary of Indebtedness permitted by Section 8.03(e) ; provided , that , (a) such Sale and Leaseback Transaction shall be consummated within six (6) months of the purchase of the applicable fixed asset(s) (or, in the case of any such fixed assets owned by such Loan Party or such Subsidiary as of the Effective Date, within six (6) months of the Effective Date)

and (b) the fixed assets that are the subject of such Sale and Leaseback Transaction shall be financed with Indebtedness incurred in reliance on Section 8.03(e) .

“ Permitted Senior Revolving Credit Documents ” means each agreement, instrument and document entered into by Establishment Labs Sociedad Anonima in connection with any Permitted Senior Revolving Credit Indebtedness, in each case in form and substance satisfactory to the Administrative Agent, as the same may be amended, modified, extended, restated, replaced or supplemented from time to time subject to the terms and provisions of the intercreditor agreement entered into by the Administrative Agent in connection therewith.

“ Permitted Senior Revolving Credit Indebtedness ” means senior secured Indebtedness of Establishment Labs Sociedad Anonima which satisfies the following requirements: (a) the Loan Parties shall have delivered to the Administrative Agent and the Lenders the applicable Permitted Senior Revolving Credit Documents prior to incurrence of the Permitted Senior Revolving Credit Indebtedness thereunder, in each case certified by a Responsible Officer of Establishment Labs Sociedad Anonima, (b) the Administrative Agent shall have approved the financial institution providing such Permitted Senior Revolving Credit Indebtedness (each such financial institution, a “ Permitted Senior Revolving Credit Lender ”) and (c) no Loan Party nor any Subsidiary of a Loan Party (in each case, other than Establishment Labs Sociedad Anonima) shall Guarantee, or provide a Lien with respect to, such Indebtedness.

“ Permitted Senior Revolving Credit Lender ” has the meaning set forth in the definition of “Permitted Senior Revolving Credit Indebtedness.”

“ Permitted Senior Revolving Credit Priority Collateral ” has the meaning set forth in Section 8.03(g) .

“ Person ” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“ Plan ” means any employee benefit plan within the meaning of Section 3(3) of ERISA (including a Pension Plan), and public or private, statutory or in addition to statutory requirements, maintained for employees of the Borrower or any of its Subsidiaries or any of their respective Affiliates, or any ERISA Affiliate or any such Plan to which the Borrower or any of its Subsidiaries or any of their respective Affiliates or any ERISA Affiliate is required to contribute, sponsor, maintain, or contribute on behalf of any of its employees.

“ Pledge Agreements ” means, collectively, the U.S. Pledge Agreements, the Brazilian Share Pledge Agreement and the Belgian Share Pledge Agreement.

“ PMA ” has the meaning set forth in the definition of “Device Clearance Application”.

“ Prime Rate ” means, with respect to any Interest Period, the fluctuating rate per annum equal to the highest rate published in the “Money Rates” section of The Wall Street Journal as the “prime rate” then in effect (or, if such source is not available for any reason, such alternative source as determined by the Administrative Agent) on the first Business Day of such Interest Period; provided , that , the “Prime Rate” initially shall be set on the first Business Day of the applicable LIBOR Unavailability Period for the Interest Period in which such LIBOR Unavailability Period commences.

“ Pro Forma Basis ”, “ Pro Forma Compliance ” and “ Pro Forma Effect ” means, in respect of a Specified Transaction, that such Specified Transaction and the following transactions in connection therewith (to the extent applicable) shall be deemed to have occurred as of the first day of the applicable period for the

applicable covenant or requirement: (a)(i) with respect to any Disposition, Involuntary Disposition or sale, transfer or other disposition that results in a Person ceasing to be a Subsidiary, income statement and cash flow statement items (whether positive or negative) attributable to the Person or property disposed of shall be excluded and (ii) with respect to any Acquisition or Investment, income statement and cash flow statement items (whether positive or negative) attributable to the Person or property acquired shall be included to the extent relating to any period applicable in such calculations to the extent (A) such items are not otherwise included in such income statement items for the Borrower and is Subsidiaries in accordance with GAAP or in accordance with any defined terms set forth in Section 1.01 and (B) such items are supported by financial statements or other information reasonably satisfactory to the Administrative Agent, (b) any retirement of Indebtedness and (c) any incurrence or assumption of Indebtedness by any Loan Party or any Subsidiary (and if such Indebtedness has a floating or formula rate, such Indebtedness shall have an implied rate of interest for the applicable period for purposes of this definition determined by utilizing the rate which is or would be in effect with respect to such Indebtedness as at the relevant date of determination); provided , that , Pro Forma Basis, Pro Forma Compliance and Pro Forma Effect in respect of any Specified Transaction shall be calculated in a reasonable and factually supportable manner and certified by a Responsible Officer of the Borrower.

“ Product ” means (a) those Devices set forth (and described in reasonable detail) on Schedule 1.01(a) to the Disclosure Letter and (b) any current or future Device developed, manufactured, licensed, marketed, sold or otherwise commercialized by any Loan Party or any Subsidiary, including any such Device currently in development.

“ Product Agreement ” means, with respect to any Product, any contract, license, document, instrument, interest (equity or otherwise) or the like under which one or more Persons grants or receives (a) any right, title or interest with respect to any Product Commercialization and Development Activities in respect of such Product or (b) any right to exclude any other Person from engaging in, or otherwise restricting any right, title or interest as to, any Product Commercialization and Development Activities with respect to such Product, including any contract with suppliers, manufacturers, distributors, clinical research organizations, hospitals, group purchasing organizations, wholesalers, pharmacies or any other Person related to such entity.

“ Product Assets ” means, with respect to any Product, (a) any and all rights, title and interest of any Loan Party or any Subsidiary in any assets relating to such Product or any Product Commercialization and Development Activities with respect to such Product, (b) all Product Related Information with respect to such Product or any related Product Commercialization and Development Activities, (c) any Product Agreement related to such Product or any such Product Commercialization and Development Activities, (d) any IP Rights, Regulatory Approvals and similar assets with respect to such Product or any such Product Commercialization and Development Activities and (e) all rights, title and interests in any other property, tangible or intangible, manifesting or otherwise in respect of such Product or any such Product Commercialization and Development Activities, including, without limitation, inventory, accounts receivable or similar rights to receive money or payment pertaining thereto and all proceeds of the foregoing.

“ Product Authorizations ” means any and all Regulatory Approvals (including all applicable IDEs, PMAs, 510(k)s, Device Clearance Applications, Product Standards, supplements, amendments, pre- and post- approvals, governmental price and reimbursement approvals and approvals of applications for regulatory exclusivity), clearances, licenses, notifications, registrations or authorizations of or required by any applicable Regulatory Authority in each case necessary for the ownership, use or commercialization of any Product or for any Product Commercialization and Development Activities with respect thereto in any country or jurisdiction, whether U.S. or non-U.S.

“ Product Commercialization and Development Activities ” means, with respect to any Product, any combination of research, development, manufacture, import, use, sale, licensing, importation, storage, labeling, marketing, promotion, supply, distribution, testing, packaging, purchasing or other commercialization activities, receipt of payment in respect of any of the foregoing (including, without limitation, in respect of licensing, royalty or similar payments), or any similar or other activities the purpose of which is to commercially exploit such Product.

“ Product Related Information ” means, with respect to any Product, all materials and information owned or possessed by the Loan Parties or any of their respective Subsidiaries that is necessary or required for any Product Commercialization and Development Activities relating to such Product, including (a) brand materials, packaging and other trade dress, customer targeting and other marketing, promotion and sales materials and information, referral, customer, supplier and other contact lists and information, product, business, marketing and sales plans, research, studies and reports, sales, maintenance and production records, training materials and other marketing, sales and promotional information, (b) clinical data, information included or supporting any Product Authorization or other Regulatory Approval, any regulatory filings, updates, notices and correspondence (including adverse event and other pharmacovigilance and other post-marketing reports and information, etc.), technical information, product development and operational data and records, and all other documents, records, files, data and other information relating to product development, manufacture and use, (c) litigation and dispute records, and accounting records, (d) all documents, records and files relating to IP Rights, including all correspondence from and to third parties (including IP Rights counsel and patent, trademark and other intellectual property registries, including the United States Patent and Trademark Office) and (e) all other information, techniques and know-how necessary or required in connection with the Product Commercialization and Development Activities for any Product.

“ Product Revenues ” means, for any period, for the Borrower and its Subsidiaries on a consolidated basis, all amounts paid to and received by the Borrower and its Subsidiaries in the ordinary course of business that, in accordance with GAAP, would be classified as net revenue, excluding upfront payments, milestones, royalties and other similar one-time payments received by the Borrower and its Subsidiaries that are not related to the sale of products or services; provided , that , “Product Revenues” shall exclude the revenues generated by any Subsidiary to the extent that the declaration or payment of dividends or similar distributions by that Subsidiary of the income resulting from such revenues is not at the time permitted by operation of the terms of its Organization Documents or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Subsidiary.

“ Product Standards ” means all safety, quality and other specifications and standards applicable to any Product, including all medical device and other standards promulgated by Standards Bodies.

“ Proposed Term Sheet ” has the meaning set forth in Section 2.13(b) .

“ Proposed Terms ” has the meaning set forth in Section 2.13(b) .

“ Qualified Capital Stock ” of any Person means any Equity Interests of such Person that are not Disqualified Capital Stock.

“ Qualified Loan Party ” means (a) any BVI Loan Party, (b) any Costa Rican Loan Party, (c) any U.S. Loan Party or (d) any Loan Party (other than any BVI Loan Party, Costa Rican Loan Party or U.S. Loan Party), that is organized in a jurisdiction (as designated by the Administrative Agent to the Borrower in writing): (i) that permits such Loan Party to grant to the Administrative Agent, for the benefit of the Secured Parties, Liens that are first priority and perfected in substantially all of the assets of such Loan Party (other than Excluded Property), pursuant to Section 7.14 and the Collateral Documents and (ii) the Laws of which,

in the reasonable determination of the Administrative Agent, provide the Administrative Agent with the ability to enforce such Liens in a manner that is substantially equivalent to the ability to enforce Liens against a U.S. Loan Party.

“ Qualifying Control Agreement ” means an agreement among a Loan Party, a depository institution or securities intermediary and the Administrative Agent (or the Trustee), for the benefit of the Secured Parties, which agreement is in form and substance reasonably satisfactory to the Administrative Agent and which provides the Administrative Agent (or the Trustee, as applicable) with “control” (as such term is used in Article 9 of the Uniform Commercial Code) or dominion over the deposit account(s) or securities account(s) described therein.

“ Qualifying IPO ” means the issuance by the Borrower of its common Equity Interests in an underwritten primary public offering (other than a public offering pursuant to a registration statement on Form S-8) pursuant to an effective registration statement filed with the SEC in accordance with the Securities Act that results in gross proceeds to the Borrower of at least $40,000,000, and such Equity Interests are listed on a nationally-recognized stock exchange in the United States.

“ Real Property Security Documents ” means with respect to the fee interest of any Loan Party in any real property (other than Excluded Property):

(a) a fully executed and notarized Mortgage encumbering the fee interest of such Loan Party in such real property;

(b) if requested by the Administrative Agent in its sole discretion, maps or plats of an as-built survey of the sites of such real property certified to the Administrative Agent and the title insurance company issuing the policies referred to in clause (c) of this definition in a manner satisfactory to each of the Administrative Agent and such title insurance company, dated a date satisfactory to each of the Administrative Agent and such title insurance company by an independent professional licensed land surveyor, which maps or plats and the surveys on which they are based shall be sufficient to delete any standard printed survey exception contained in the applicable title policy and be made in accordance with the Minimum Standard Detail Requirements for Land Title Surveys jointly established and adopted by the American Land Title Association and the American Congress on Surveying and Mapping in 2011 with items 2, 3, 4, 6(b), 7(a), 7(b)(1), 7(c), 8, 9, 10, 11(a), 13, 14, 16,17, 18 and 19 on Table A thereof completed;

(c) ALTA mortgagee title insurance policies issued by a title insurance company acceptable to the Administrative Agent with respect to such real property, assuring the Administrative Agent that the Mortgage covering such real property creates a valid and enforceable first priority mortgage lien on such real property, free and clear of all defects and encumbrances except Permitted Liens, which title insurance policies shall otherwise be in form and substance satisfactory to the Administrative Agent and shall include such endorsements as are requested by the Administrative Agent;

(d) evidence as to (i) whether such real property is in an area designated by the Federal Emergency Management Agency as having special flood or mud slide hazards (a “ Flood Hazard Property ”) and (ii) if such real property is a Flood Hazard Property, (A) whether the community in which such real property is located is participating in the National Flood Insurance Program, (B) the applicable Loan Party’s written acknowledgment of receipt of written notification from the Administrative Agent (1) as to the fact that such real property is a Flood Hazard Property and (2) as to whether the community in which each such Flood Hazard Property is located is participating in

the National Flood Insurance Program and (C) copies of insurance policies or certificates of insurance of the Borrower and its Subsidiaries evidencing flood insurance satisfactory to the Administrative Agent and naming the Administrative Agent and its successors and/or assigns as sole loss payee on behalf of the Secured Parties;

(e) if requested by the Administrative Agent in its sole discretion, an environmental assessment report, as to such real property, in form and substance and from professional firms acceptable to the Administrative Agent;

(f) if requested by the Administrative Agent in its sole discretion, evidence reasonably satisfactory to the Administrative Agent that such real property, and the uses of such real property, are in compliance in all material respects with all applicable zoning laws (the evidence submitted as to which should include the zoning designation made for such real property, the permitted uses of such real property under such zoning designation and, if available, zoning requirements as to parking, lot size, ingress, egress and building setbacks); and

(g) if requested by the Administrative Agent in its sole discretion, an opinion of legal counsel to the Loan Party granting the Mortgage on such real property, addressed to the Administrative Agent and each Lender, in form and substance reasonably acceptable to the Administrative Agent.

“ Recipient ” means the Administrative Agent, any Lender, and any other recipient of any payment by or on account of any obligation of any Loan Party under any Loan Document.

“ Referral Source ” has the meaning set forth in Section 6.16(b) .

“ Register ” has the meaning set forth in Section 11.06(c) .

“ Regulatory Approval ” means any Governmental Approval relating to any Product or any Product Commercialization and Development Activities, including any Product Authorizations with respect thereto.

“ Regulatory Authority ” means any Governmental Authority, whether U.S. or non-U.S., that is concerned with or has regulatory or supervisory oversight with respect to any Product or any Product Commercialization and Development Activities, including the FDA and all equivalent Governmental Authorities, whether U.S. or non-U.S.

“ Related Parties ” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees, administrators, managers, advisors, sub-advisors and representatives of such Person and of such Person’s Affiliates.

“ Relativity Warrant ” means that certain Warrant Certificate dated as of September 30, 2016 issued by the Borrower in favor of Relativity Healthcare Fund, LLC.

“ Reportable Event ” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the thirty-day notice period has been waived.

“ Required Lenders ” means, at any time, Lenders having Total Credit Exposures representing more than fifty percent (50%) of the Total Credit Exposures of all Lenders. The Total Credit Exposure of any Defaulting Lender shall be disregarded in determining Required Lenders at any time.

“ Responsible Officer ” means a director, the chief executive officer, president, chief legal officer, chief financial officer, treasurer, assistant treasurer or controller of a Loan Party and, solely for purposes of the delivery of certificates pursuant to Sections 5.02 or 7.12 , the secretary or any assistant secretary of a Loan Party. Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party.

“ Restricted ” means, when referring to cash or Cash Equivalents of the Loan Parties, that such cash or Cash Equivalents (a) appear (or would be required to appear) as “restricted” on a consolidated balance sheet of the Borrower and its Subsidiaries as determined in accordance with GAAP, or (b) are subject to any Lien in favor of any Person (other than bankers’ liens and rights of setoff) other than the Administrative Agent for the benefit of the Secured Parties.

“ Restricted Payment ” means (a) any dividend or other distribution, direct or indirect, on account of any shares (or equivalent) of any class of Equity Interests of any Loan Party or any of its Subsidiaries, now or hereafter outstanding, (b) any redemption, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any shares (or equivalent) of any class of Equity Interests of any Loan Party or any of its Subsidiaries, now or hereafter outstanding, (c) any payment made to retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire shares of any class of Equity Interests of any Loan Party or any of its Subsidiaries, now or hereafter outstanding and (d) any payment made in cash to holders of Convertible Indebtedness in excess of the original principal (or notional) amount thereof and interest thereon (and, to the extent not permissible to be satisfied with shares of common stock, customary redemption, mandatory conversion or similar premiums, if any).

“ ROFR Side Letter ” means that certain letter agreement dated as of the Funding Date by and between the Borrower and the Lenders from time to time party thereto with respect to the purchase of certain Equity Interests of the Borrower in connection with a sale of the Equity Interests of the Borrower.

“ S&P ” means Standard & Poor’s Financial Services LLC, a subsidiary of The McGraw-Hill Companies, Inc., and any successor thereto.

“ Sale and Leaseback Transaction ” means, with respect to any Loan Party or any Subsidiary, any arrangement, directly or indirectly, with any Person whereby such Loan Party or such Subsidiary shall sell or transfer any property used or useful in its business, whether now owned or hereafter acquired, and thereafter rent or lease such property or other property that it intends to use for substantially the same purpose or purposes as the property being sold or transferred.

“ Sanction(s) ” means any sanction administered or enforced by the United States government (including, without limitation, OFAC), the United Nations Security Council, the European Union, Her Majesty’s Treasury (“ HMT ”), the Costa Rican Institute of Drugs or other relevant sanctions authority.

“ SEC ” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.

"Second Amendment Effective Date ” means June 15, 2018.

“ Secured Parties ” means, collectively, the Administrative Agent, the Lenders and the Indemnitees.

“ Securities Act ” means the Securities Act of 1933.

“ Securitization Transaction ” means, with respect to any Person, any financing transaction or series of financing transactions (including factoring arrangements) pursuant to which such Person or any Subsidiary of such Person may sell, convey or otherwise transfer, or grant a security interest in, accounts, payments, receivables, rights to future lease payments or residuals or similar rights to payment to a special purpose subsidiary or affiliate of such Person.

“ Security Agreements ” means, collectively, the U.S. Security Agreement, the U.S. IP Security Agreement, the U.S. Deposit Account Security Agreement, the Belgian Receivables Pledge Agreement, Brazilian Receivables Pledge Agreement, the Costa Rican IP Security Agreement and the Costa Rican Security Trust Agreement.

“ Share Purchase Agreement ” means that certain Series F Share Purchase Agreement dated as of the Funding Date by and between the Borrower and the Lenders.

“ Solvent ” or “ Solvency ” means, with respect to (a) any BVI Loan Party as of a particular date, that on such date such BVI Loan Party is “solvent” as such term is determined under Section 8 of the Insolvency Act, 2003 of the British Virgin Islands and (b) any Person (including, for the avoidance of doubt, any BVI Loan Party) as of a particular date, that on such date (i) such Person is able to pay its debts and other liabilities, contingent obligations and other commitments as they mature in the ordinary course of business, (ii) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature in their ordinary course, (iii) such Person is not engaged in a business or a transaction, and is not about to engage in a business or a transaction, for which such Person’s property would constitute unreasonably small capital after giving due consideration to the prevailing practice in the industry in which such Person is engaged or is to engage, (iv) the fair value of the property of such Person is greater than the total amount of liabilities, including, without limitation, contingent liabilities, of such Person and (v) the present fair salable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured. In computing the amount of contingent liabilities at any time, it is intended that such liabilities will be computed at the amount which, in light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

“ Specified Cure Contribution ” has the meaning set forth in Section 8.16(b)(i) .

“ Specified Deposit Account ” has the meaning set forth in the U.S. Deposit Account Security Agreement.

“ Specified Transaction ” means (a) any Acquisition, any Disposition, any sale, transfer or other disposition that results in a Person ceasing to be a Subsidiary, any Involuntary Disposition, or any Investment that results in a Person becoming a Subsidiary, in each case, whether by merger, amalgamation, consolidation or otherwise or any incurrence or repayment of Indebtedness or (b) any other event that by the terms of the Loan Documents requires Pro Forma Compliance with a test or covenant, calculation as to Pro Forma Effect with respect to a test or covenant or requires such test or covenant to be calculated on a Pro Forma Basis.

“ Standard Bodies ” means applicable organizations that create, sponsor or maintain safety, quality or other standards, including ISO, ANSI, CEN and SCC.

“ Subsidiary ” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of Voting Stock is at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries,

or both, by such Person. Unless otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of the Borrower.

“ Swap Contract ” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “ Master Agreement ”), including any such obligations or liabilities under any Master Agreement; provided , that , the term “Swap Contract” shall not include (i) phantom stock, stock option plans or similar plans providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Borrower or its Subsidiaries or (ii) any option or warrant agreement for the purchase of Equity Interests of the Borrower.

“ Swap Termination Value ” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s) and (b) for any date prior to the date referenced in clause (a) , the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include a Lender or any Affiliate of a Lender).

“ Synthetic Lease ” means any synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing arrangement whereby the arrangement is considered borrowed money indebtedness for tax purposes but is classified as an operating lease or does not otherwise appear on a balance sheet under GAAP.

“ Taxes ” has the meaning set forth in Section 3.01(a) .

“ Technical Information ” means all trade secrets and other proprietary or confidential information, public information, non-proprietary know-how, any information of a scientific, technical or business nature in any form or medium, standards and specifications, conceptions, ideas, innovations, discoveries, Inventions, invention disclosures, all documented research, developmental, demonstration or engineering work and all other information, data, plans, specifications, reports, summaries, experimental data, manuals, models, samples, know-how, technical information, systems, methodologies, computer programs, information technology and any other information.

“ Term A Borrowing ” means a borrowing consisting of simultaneous Term A Loans made by each of the Term A Lenders pursuant to Section 2.01(a) .

“ Term A Commitment ” means, as to each Term A Lender, its obligation to make a Term A Loan to the Borrower pursuant to Section 2.01(a) , in the principal amount set forth opposite such Lender’s name on Schedule 2.01 . The aggregate principal amount of the Term A Commitments of all of the Term A Lenders as in effect on the Effective Date is THIRTY MILLION DOLLARS ($30,000,000).

“ Term A Facility ” means, at any time, (a) on or prior to the Funding Date, the aggregate amount of the Term A Commitments at such time and (b) thereafter, the aggregate Outstanding Amount of the Term A Loans of all Term A Lenders outstanding at such time.

“ Term A Lender ” means (a) at any time on or prior to the Funding Date, any Lender that has a Term A Commitment at such time and (b) at any time after the Funding Date, any Lender that holds one or more Term A Loans at such time.

“ Term A Loan ” means an advance made by any Term A Lender under the Term A Facility.

“ Term A Note ” has the meaning set forth in Section 2.09 .

“ Term B-1 Availability Period ” means the period from and after October 31, 2017 (or such earlier date as may be agreed to by the Administrative Agent in its sole discretion) to the earliest of (a) June 30, 2019, (b) the date of termination of the Term B-1 Commitments pursuant to Section 2.04 and (c) the date of termination of the Term B-1 Commitments pursuant to Section 9.02 .

“ Term B-1 Borrowing ” means a borrowing consisting of simultaneous Term B-1 Loans made by each of the Term B-1 Lenders pursuant to Section 2.01(b)(i) .

“ Term B-1 Commitment ” means, as to each Term B-1 Lender, its obligation to make a Term B-1 Loan to the Borrower pursuant to Section 2.01(b)(i) , in the principal amount set forth opposite such Lender’s name on Schedule 2.01 . The aggregate principal amount of the Term B-1 Commitments of all of the Term B-1 Lenders as in effect on the Effective Date is FIVE MILLION DOLLARS ($5,000,000).

“ Term B-1 Facility ” means, at any time, (a) on or prior to the funding of the Term B-1 Loans, the aggregate amount of the Term B-1 Commitments at such time and (b) thereafter, the aggregate Outstanding Amount of the Term B-1 Loans of all Term B-1 Lenders outstanding at such time.

“ Term B-1 Lender ” means (a) at any time on or prior to the funding of the Term B-1 Loans, any Lender that has a Term B-1 Commitment at such time and (b) at any time after the funding of the Term B-1 Loans, any Lender that holds one or more Term B-1 Loans at such time.

“ Term B-1 Loan ” means an advance made by any Term B-1 Lender under the Term B-1 Facility.

“ Term B-1 Note ” has the meaning set forth in Section 2.09 .

“ Term B-2 Availability Period ” means the period from and after the Funding Date to the earliest of (a) June 30, 2019, (b) the date of termination of the Term B-2 Commitments pursuant to Section 2.04 and (c) the date of termination of the Term B-2 Commitments pursuant to Section 9.02 .

“ Term B-2 Borrowing ” means a borrowing consisting of simultaneous Term B-2 Loans made by each of the Term B-2 Lenders pursuant to Section 2.01(b)(ii) .

“ Term B-2 Commitment ” means, as to each Term B-2 Lender, its obligation to make a Term B-2 Loan to the Borrower pursuant to Section 2.01(b)(ii) , in the principal amount set forth opposite such Lender’s name on Schedule 2.01 . The aggregate principal amount of the Term B-2 Commitments of all of the Term B-2 Lenders as in effect on the Effective Date is FIVE MILLION DOLLARS ($5,000,000).

“ Term B-2 Facility ” means, at any time, (a) on or prior to the funding of the Term B-2 Loans, the aggregate amount of the Term B-2 Commitments at such time and (b) thereafter, the aggregate Outstanding Amount of the Term B-2 Loans of all Term B-2 Lenders outstanding at such time.

“ Term B-2 Lender ” means (a) at any time on or prior to the funding of the Term B-2 Loans, any Lender that has a Term B-2 Commitment at such time and (b) at any time after the funding of the Term B-2 Loans, any Lender that holds one or more Term B-2 Loans at such time.

“ Term B-2 Loan ” means an advance made by any Term B-2 Lender under the Term B-2 Facility.

“ Term B-2 Note ” has the meaning set forth in Section 2.09 .

“ Term B-3 Availability Period ” means the period from and after the Funding Date to the earliest of (a) June 30, 2019, (b) the date of termination of the Term B-3 Commitments pursuant to Section 2.04 and (c) the date of termination of the Term B-3 Commitments pursuant to Section 9.02 .

“ Term B-3 Borrowing ” means a borrowing consisting of simultaneous Term B-3 Loans made by each of the Term B-3 Lenders pursuant to Section 2.01(b)(iii) .

“ Term B-3 Commitment ” means, as to each Term B-3 Lender, its obligation to make a Term B-3 Loan to the Borrower pursuant to Section 2.01(b)(iii) , in the principal amount set forth opposite such Lender’s name on Schedule 2.01 . The aggregate principal amount of the Term B-3 Commitments of all of the Term B-3 Lenders as in effect on the Effective Date is FIVE MILLION DOLLARS ($5,000,000).

“ Term B-3 Facility ” means, at any time, (a) on or prior to the funding of the Term B-3 Loans, the aggregate amount of the Term B-3 Commitments at such time and (b) thereafter, the aggregate Outstanding Amount of the Term B-3 Loans of all Term B-3 Lenders outstanding at such time.

“ Term B-3 Lender ” means (a) at any time on or prior to the funding of the Term B-3 Loans, any Lender that has a Term B-3 Commitment at such time and (b) at any time after the funding of the Term B-3 Loans, any Lender that holds one or more Term B-3 Loans at such time.

“ Term B-3 Loan ” means an advance made by any Term B-3 Lender under the Term B-3 Facility.

“ Term B-3 Note ” has the meaning set forth in Section 2.09 .

“ Term C Availability Period ” means the period from and after the institution of the Term C Commitments pursuant to Section 2.14 to the earliest of (a) [June 30], 2020, (b) the date of termination of the Term C Commitments pursuant to Section 2.04 and (c) the date of termination of the Term C Commitments pursuant to Section 9.02 .

“ Term C Borrowing ” means a borrowing consisting of simultaneous Term C Loans made by each of the Term C Lenders pursuant to Section 2.01(c) .

“ Term C Commitment ” means, as to each Term C Lender, its obligation to make Term C Loans to the Borrower pursuant to Section 2.01(c) , in the principal amount set forth opposite such Lender’s name on Schedule 2.01 . The aggregate principal amount of the Term C Commitments of all of the Term C Lenders shall not exceed TEN MILLION DOLLARS ($10,000,000.00).

“ Term C Facility ” means, at any time, (a) during the Term C Availability Period, the aggregate amount of the undrawn Term C Commitments and aggregate Outstanding Amount of the Term C Loans, if any, at such time and (b) thereafter, the aggregate Outstanding Amount of the Term C Loans of all Term C Lenders outstanding at such time.

“ Term C Lender ” means (a) during the Term C Availability Period, any Lender that has a Term C Commitment at such time and (b) at any time after the Term C Availability Period, any Lender that holds one or more Term C Loans at such time.

“ Term C Loan ” means an advance made by any Term C Lender under the Term C Facility.

“ Term C Note ” has the meaning set forth in Section 2.09 .

“ Three-Month LIBOR ” means, with respect to any Interest Period, a rate per annum equal to the greater of (x) one percent (1.00%) per annum and (y) the three-month London Interbank Offered Rate for deposits in Dollars at approximately 11:00 a.m. (London, England time), as determined by the Administrative Agent from the appropriate Bloomberg or Telerate page selected by the Administrative Agent (the “ LIBOR Screen Rate ”) (or any successor thereto or similar source reasonably determined by the Administrative Agent from time to time), two (2) Business Days prior to the first Business Day of such Interest Period and rounded up to the nearest 1/16 of one percent (1.00%). The Administrative Agent’s determination of interest rates shall be determinative in the absence of manifest error.

“ Threshold Amount ” means $750,000.

“ Total Credit Exposure ” means, as to any Lender at any time, the unused Commitments of such Lender at such time and the Outstanding Amount of all Loans of such Lender at such time.

“ Trademarks ” means, collectively, all trademarks (including service marks), slogans, logos, symbols, certification marks, collective marks, trade dress, uniform resource locators (URL's), domain names, corporate names and trade names, whether statutory or common law, whether registered or unregistered and whether established or registered in the United States or any other country or any political subdivision thereof, all registrations and applications for the foregoing and all tangible embodiments of the foregoing, together with, in each case, the goodwill symbolized thereby and any and all (a) rights and privileges arising under applicable Law and international treaties and conventions with respect to the use of any trademarks, (b) reissues, continuations, extensions and renewals thereof and amendments thereto, (c) income, fees, royalties, damages and payments now and hereafter due and/or payable thereunder and with respect thereto, including damages, claims and payments for past, present or future infringements thereof, (d) rights corresponding thereto throughout the world and (e) rights to sue for past, present and future infringements thereof.

“ Trustee ” means Intermanagement Costa Rica, Ltda., acting as fiduciary in the Costa Rican Security Trust Agreement.

“ United States ” and “ U.S. ” mean the United States of America.

“ Unrestricted Cash ” means, at any time, the aggregate cash and Cash Equivalents of the Loan Parties (without duplication) that are not Restricted at such time.

“ U.S. Deposit Account Security Agreement ” means the U.S. deposit account security agreement dated as of the Funding Date executed in favor of the Administrative Agent, for the benefit of the Secured

Parties, by Establishment Labs Sociedad Anonima, a Costa Rica corporation, with respect to the Specified Deposit Account.

“ U.S. IP Security Agreement ” means the U.S. intellectual property security agreement dated as of the Funding Date executed in favor of the Administrative Agent, for the benefit of the Secured Parties, by Establishment Labs Sociedad Anonima, a Costa Rica corporation, with respect to its U.S. intellectual property.

“ U.S. Loan Party ” means any Loan Party that is organized under the laws of any state of the United States or the District of Columbia.

“ U.S. Pledge Agreements ” means, collectively, (a) the U.S. pledge agreement dated as of the Funding Date executed in favor of the Administrative Agent, for the benefit of the Secured Parties, by each of the U.S. Loan Parties and each of the BVI Loan Parties other than the Borrower and (b) the U.S. pledge agreement dated as of the Funding Date executed in favor of the Administrative Agent, for the benefit of the Secured Parties, by the Borrower.

“ U.S. Security Agreement ” means the U.S. security agreement dated as of the Funding Date executed in favor of the Administrative Agent, for the benefit of the Secured Parties, by the U.S. Loan Parties and the BVI Loan Parties.

“ VAT ” mean a consumption or value-added tax, including any similar Tax which may be imposed in place thereof from time to time.

“ Voting Stock ” means, with respect to any Person, Equity Interests issued by such Person the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of such Person, even though the right so to vote has been suspended by the happening of such a contingency.

“ Wholly Owned Subsidiary ” means, as to any Person, (a) any corporation one hundred percent (100%) of whose Equity Interests is at the time owned by such Person and/or one or more Wholly Owned Subsidiaries of such Person and (b) any partnership, association, joint venture or other entity in which such Person and/or one or more Wholly Owned Subsidiaries of such Person owns one hundred percent (100%) of the Equity Interests at such time (other than, in the case of a Foreign Subsidiary with respect to the preceding clauses (a) or (b), director’s qualifying shares and/or other nominal amounts of shares required to be held by Persons other than the Borrower and its Subsidiaries under applicable law). Unless otherwise specified, all references herein to a “Wholly Owned Subsidiary” or to “Wholly Owned Subsidiaries” shall refer to a Wholly Owned Subsidiary or Wholly Owned Subsidiaries of the Borrower .

“ Withholding Agent ” means any Loan Party, the Administrative Agent and any other Person required by applicable Law to withhold or deduct amounts from a payment made by or on account of any obligation of any Loan Party under any Loan Document.

“ Write-Down and Conversion Powers ” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

1.02 Other Interpretive Provisions.

With reference to this Agreement and each other Investment Document, unless otherwise specified herein or in such other Investment Document:

(a) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “ include ,” “ includes ” and “ including ” shall be deemed to be followed by the phrase “without limitation.” The word “ will ” shall be construed to have the same meaning and effect as the word “ shall .” Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument or other document (including the Loan Documents and any Organization Document) shall be construed as referring to such agreement, instrument or other document as from time to time amended, modified, extended, restated, replaced or supplemented from time to time (subject to any restrictions set forth herein or in any other Investment Document), (ii) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (iii) the words “ hereto ”, “ herein ,” “ hereof ” and “ hereunder ,” and words of similar import when used in any Investment Document, shall be construed to refer to such Investment Document in its entirety and not to any particular provision thereof, (iv) all references in any Investment Document to Articles, Sections, Preliminary Statements, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Preliminary Statements, Exhibits and Schedules to, the Investment Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions or determinations consolidating, amending, replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified, extended, restated, replaced or supplemented from time to time, (vi) the words “ asset ” and “ property ” shall be construed to have the same meaning and effect and to refer to any and all real and personal property and tangible and intangible assets and properties, including cash, securities, accounts and contract rights and (vii) the parties hereto have participated jointly in the negotiation and drafting of this Agreement and in the event an ambiguity or question of intent or interpretation arises, no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.

(b) In the computation of periods of time from a specified date to a later specified date, the word “ from ” means “from and including;” the words “ to ” and “ until ” each mean “to but excluding;” and the word “ through ” means “to and including.”

(c) Section headings herein and in the other Investment Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Investment Document.

1.03 Accounting Terms.

(a) Generally . Except as otherwise specifically prescribed herein, all accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the Audited Financial Statements, except as otherwise specifically prescribed herein; provided , however , that , calculations of Attributable Indebtedness under any Synthetic Lease or the implied interest

component of any Synthetic Lease shall be made by the Loan Parties in accordance with accepted financial practice in the United States and consistent with the terms of such Synthetic Lease. Notwithstanding the foregoing, for purposes of determining compliance with any covenant contained herein, Indebtedness of the Borrower and its Subsidiaries shall be deemed to be carried at 100% of the outstanding principal amount thereof, and the effects of FASB ASC 825 and FASB ASC 470-20 on financial liabilities shall be disregarded. The parties hereto acknowledge and agree that for purposes of all calculations hereunder, the principal amount of Convertible Indebtedness shall be the outstanding principal (or notional) amount thereof, valued at par.

(b) Changes in GAAP . The Loan Parties will provide a written summary of material changes in GAAP and in the consistent application thereof with each annual and quarterly financial statement delivered in accordance with Section 7.01 . If at any time any change in GAAP would affect the computation of any financial requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided , that , until so amended, (i) such requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Loan Parties shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as requested hereunder setting forth a reconciliation between calculations of such requirement made before and after giving effect to such change in GAAP. Without limiting the foregoing, leases shall continue to be classified and accounted for on a basis consistent with that reflected in the Audited Financial Statements for all purposes of this Agreement, notwithstanding any change (or the implementation of any change) in GAAP relating thereto, unless the parties hereto shall enter into a mutually acceptable amendment addressing such changes, as provided for above.

(c) Consolidation of Variable Interest Rate Entities . All references herein to consolidated financial statements of the Borrower and its Subsidiaries or to the determination of any amount for the Borrower and its Subsidiaries on a consolidated basis or any similar reference shall, in each case, be deemed to include each variable interest entity that the Borrower is required to consolidate pursuant to FASB ASC 810 as if such variable interest entity was a Subsidiary as defined herein.

(d) Pro Forma Calculations . Notwithstanding anything to the contrary contained herein, all calculations of the financial covenant set forth in Section 8.16(a) shall be made on a Pro Forma Basis with respect to all Specified Transactions occurring during the applicable period to which such calculation relates.

1.04 Times of Day.

Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).

1.05 Belgian Terms.

All references herein in the context of Belgian law or a Belgian Loan Party to:

(a) a receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer includes any curator / curateur , vereffenaar / liquidateur , voorlopig bewindvoerder / administrateur judiciaire , ondernemingsbemiddelaar / médiateur d'entreprise , as applicable;

(b) a security interest includes any mortgage ( hypotheek/hypothèque ), mortgage mandate ( hypothecair mandaat/mandat hypothécair ), pledge ( pand/nantissement ), privilege ( voorrecht / privilège ), retention right ( eigendomsvoorbehoud / droit de retention ), any real surety ( zakelijke zekerheid / sûreté réelle ) and any transfer by way of security ( overdracht ten titel van zekerheid / transfert à titre de garantie );

(c) a person being unable to pay its debts is that person being in a state of cessation of payments ( staking van betaling / cessation de paiements );

(d) a receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding includes any gerechtelijke reorganisatie / réorganisation judiciaire , vereffening / liquidation , ontbinding / dissolution , faillissement / faillite , sluiting van een onderneming / fermeture d'enterprise and any other concurrence between creditors ( samenloop van schuldeisers / concours des créanciers );

(e) a writ or warrant of attachment or execution or similar process includes any uitvoerend beslag / saisie exécutoire and bewarend beslag / saisie conservatoire ;

(f) a guaranty refers, only for the purpose of the Guaranty granted by the Belgian Loan Parties pursuant to Article IV, to the Belgian legal concept of a guarantee (“ garantie / vrijwaring ”) and not a surety (“ borg / cautionnement ”);

(g) organized under the laws of the Kingdom of Belgium means that such Loan Party has its principal place of business ( voornaamste vestiging / établissement principal ) in Belgium; and

(h) Organization Documents means the oprichtingsakte / acte constitutif , statuten / statuts and uittreksel van de Kruispuntbank voor Ondernemingen / extrait de la Banque Carrefour des Entreprises .

ARTICLE II.

THE COMMITMENTS

2.01 Commitments .

(a) Term A Borrowing . Subject to the terms and conditions set forth herein, each Term A Lender severally agrees to make a single loan to the Borrower, in Dollars, on the Funding Date in an aggregate amount not to exceed such Term A Lender’s Term A Commitment. The Term A Borrowing shall consist of Term A Loans made simultaneously by the Term A Lenders in accordance with their respective Term A Commitments. Term A Borrowings repaid or prepaid may not be reborrowed.

(b) Term B-1 Borrowings, Term B-2 Borrowings and Term B-3 Borrowings .

(i) Term B-1 Borrowing . Subject to the terms and conditions set forth herein, each Term B-1 Lender severally agrees to make a single loan to the Borrower, in Dollars, at the request of the Borrower on any Business Day during the Term B-1 Availability Period, in an aggregate amount not to exceed such Term B-1 Lender’s Term B-1 Commitment; provided , that , the Administrative Agent shall have received (A) a Compliance Certificate

pursuant to Section 7.02(a) certifying that Product Revenues were at least $[***] (without giving effect to any Cure Right) for the four consecutive fiscal quarter period most recently ended prior to the date of the Term B-1 Borrowing for which financial statements have been delivered to the Administrative Agent pursuant to Sections 7.01(a)(i) or (b) or (B) on or before the earlier of (1) November 29, 2017 and (2) the date on which the Loan Parties deliver to the Administrative Agent a Compliance Certificate pursuant to Section 7.02(a) for the fiscal quarter ending September 30, 2017, a certificate of a Responsible Officer of the Borrower certifying that Product Revenues are projected to have been at least $[***] (without giving effect to any Cure Right) for the four consecutive fiscal quarter period ending September 30, 2017 based on financial statements and projections reasonably satisfactory to the Administrative Agent. The Term B-1 Borrowing shall consist of Term B-1 Loans made simultaneously by the Term B-1 Lenders in accordance with their respective Term B-1 Commitments. Term B-1 Borrowings repaid or prepaid may not be reborrowed.

(ii) Term B-2 Borrowing . Subject to the terms and conditions set forth herein, each Term B-2 Lender severally agrees to make a single loan to the Borrower, in Dollars, at the request of the Borrower on any Business Day during the Term B-2 Availability Period, in an aggregate amount not to exceed such Term B-2 Lender’s Term B-2 Commitment; provided , that , (A) the Administrative Agent shall have received a Compliance Certificate pursuant to Section 7.02(a) certifying that Product Revenues were at least $[***] (without giving effect to any Cure Right) for the four consecutive fiscal quarter period most recently ended prior to the date of the Term B-2 Borrowing for which financial statements have been delivered to the Administrative Agent pursuant to Sections 7.01(a)(i) or (b) and (B) the Borrower shall have drawn the full amount of the Term B-1 Facility pursuant to Section 2.01(b)(i) prior to the date of the Term B-2 Borrowing. The Term B-2 Borrowing shall consist of Term B-2 Loans made simultaneously by the Term B-2 Lenders in accordance with their respective Term B-2 Commitments. Term B-2 Borrowings repaid or prepaid may not be reborrowed.

(iii) Term B-3 Borrowing . Subject to the terms and conditions set forth herein, each Term B-3 Lender severally agrees to make a single loan to the Borrower, in Dollars, at the request of the Borrower on any Business Day during the Term B-3 Availability Period, in an aggregate amount not to exceed such Term B-3 Lender’s Term B-3 Commitment; provided , that , (A) the Administrative Agent shall have received a Compliance Certificate pursuant to Section 7.02(a) certifying that Product Revenues were at least $[***] (without giving effect to any Cure Right) for the four consecutive fiscal quarter period most recently ended prior to the date of the Term B-3 Borrowing for which financial statements have been delivered to the Administrative Agent pursuant to Sections 7.01(a)(i) or (b) ( provided , that , in order to use a Compliance Certificate delivered in connection with financial statements delivered pursuant to Section 7.01(b) for the first fiscal quarter of any fiscal year of the Borrower for this purpose, the Borrower must have previously delivered the financial statements required pursuant to Section 7.01(a)(i) for the prior fiscal year to the Administrative Agent) and (B) the Borrower shall have drawn the full amount of the Term B-1 Facility and Term B-2 Facility pursuant to Sections 2.01(b)(i) and (ii) , respectively, prior to the date of the Term B-3 Borrowing. The Term B-3 Borrowing shall consist of Term B-3 Loans made simultaneously by the Term B-3 Lenders in accordance with their respective Term B-3 Commitments. Term B-3 Borrowings repaid or prepaid may not be reborrowed

(c) Term C Borrowings . Subject to Section 2.14 and the other terms and conditions set forth herein, each Term C Lender severally agrees to make up to four (4) loans to the Borrower, in Dollars, during the Term C Availability Period, in an aggregate amount not to exceed such Term C Lender’s Term C Commitment. Each Term C Borrowing shall consist of Term C Loans made

simultaneously by the Term C Lenders in accordance with their respective Term C Commitments. Term C Borrowings repaid or prepaid may not be reborrowed.

2.02 Borrowings.

(a) Each Borrowing shall be made upon the Borrower’s irrevocable notice (in the form of a written Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower) to the Administrative Agent, which must be given not later than 11:00 a.m. (x) on the Effective Date in the case of the Term A Borrowing, (y) at least ten (10) Business Days (or such shorter period as may be agreed to by the Administrative Agent in its sole discretion) in advance of the requested date of such Borrowing in the case of the Term B-1 Borrowing or (z) at least fifteen (15) Business Days (or such shorter period as may be agreed to by the Administrative Agent in its sole discretion) in advance of the requested date of such Borrowing (other than the Term A Borrowing and the Term B-1 Borrowing). Each Loan Notice shall specify (i) the requested date of such Borrowing (which shall be a Business Day), (ii) the applicable Facility under which the Borrower is requesting such Borrowing and (iii) the principal amount of Loans to be borrowed. The Borrowing of Term A Loans shall be in an aggregate principal amount of $30,000,000. The Borrowing of Term B-1 Loans shall be in an aggregate principal amount of $5,000,000. The Borrowing of Term B-2 Loans shall be in an aggregate principal amount of $5,000,000. The Borrowing of Term B-3 Loans shall be in an aggregate principal amount of $5,000,000. Each Borrowing of Term C Loans shall be in an aggregate principal amount of $2,500,000.

(b) Following receipt of a Loan Notice for a Facility, the Administrative Agent shall promptly notify each Appropriate Lender of the amount of its Applicable Percentage under such Facility of the applicable Loans. Each Appropriate Lender shall make the amount of its Loan available to the Administrative Agent in immediately available funds at the Administrative Agent’s Office not later than 1:00 p.m. on the Business Day specified in the applicable Loan Notice. Upon satisfaction of the applicable conditions set forth in Section 5.03 and Section 5.04 (and, if such Borrowing is the initial Borrowing, Section 5.01 and Section 5.02 ), the Administrative Agent shall make all funds so received available to the Borrower in like funds as received by the Administrative Agent by wire transfer of such funds in accordance with instructions provided to (and acceptable to) the Administrative Agent by the Borrower.

2.03 Prepayments.

(a) Voluntary Prepayments . Subject to the payment of any prepayment premium as required under Section 2.03(d) and any other fees or amounts payable hereunder at such time, the Borrower may, upon notice from the Borrower to the Administrative Agent, voluntarily prepay the Loans, in whole or in part; provided , that , (i) such notice must be received not later than 11:00 a.m. three (3) Business Days prior to the date of prepayment, (ii) any such prepayment shall only be made on an Interest Payment Date (it being understood that the requirement set forth in this sub-clause (ii) shall not be applicable to any voluntary prepayment in full of the aggregate Outstanding Amount of the Loans in connection with a Facility Termination Date) and (iii) any such prepayment shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof (or, if less, the entire principal amount thereof then outstanding). Each such notice shall specify the date and amount of such prepayment. If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein; provided , that , any such notice of prepayment may indicate that such prepayment is conditioned upon the consummation of a refinancing of this Agreement, capital raising or a

particular Disposition or the occurrence of a Change of Control and may be revoked by the Borrower in the event such refinancing or other transaction is not consummated, and if so revoked, such prepayment shall not be due and payable. Any prepayment pursuant to this Section 2.03(a) shall be accompanied by (x) all accrued interest on the principal amount of the Loans prepaid, (y) the prepayment premium required under Section 2.03(d) and (z) all fees, costs, expenses, indemnities and other amounts due and payable hereunder at the time of prepayment. Each such prepayment shall be applied (x) with respect to any such prepayment on or prior to [June 30, 2021], ratably to the Term A Facility, the Term B-1 Facility, the Term B-2 Facility, the Term B-3 Facility and the Term C Facility and (y) with respect to any such prepayment after [June 30, 2021], ratably to the Term A Facility, the Term B-1 Facility, the Term B-2 Facility, the Term B-3 Facility and the Term C Facility and to the principal repayment installments thereof on a pro rata basis. Each such prepayment shall be applied to the Loans of the Lenders in accordance with their respective Applicable Percentages in respect of each of the relevant Facilities.

(b) Mandatory Prepayments .

(i) Dispositions and Involuntary Dispositions . The Borrower shall promptly (and in any event, within five (5) Business Days) prepay the Obligations in an aggregate amount equal to 100% of the Net Cash Proceeds of all Dispositions and Involuntary Dispositions received by any Loan Party or any Subsidiary; provided , that , such Net Cash Proceeds shall not be required to be so applied (A) until the aggregate amount of Net Cash Proceeds derived from all such Dispositions or Involuntary Dispositions in any fiscal year is equal to or greater than $500,000 (and then only in excess of such amount) and (B) if, at the election of the Borrower, such Loan Party or such Subsidiary reinvests all or any portion of such Net Cash Proceeds in Eligible Assets within three hundred sixty five (365) days of the date of such Disposition or Involuntary Disposition; provided , further , that , for purposes of the foregoing clause (B) , if such Net Cash Proceeds shall have not been so reinvested by the end of such period, such Net Cash Proceeds shall be immediately applied to prepay the Loans. Any prepayment pursuant to this clause (i) shall be applied as set forth in clause (iv) below.

(ii) Extraordinary Receipts . The Borrower shall promptly (and, in any event, within five (5) Business Days) upon the receipt by any Loan Party or any Subsidiary of the Net Cash Proceeds of any Extraordinary Receipt, prepay the Obligations in an aggregate amount equal to 100% of such Net Cash Proceeds; provided , that , such Net Cash Proceeds shall not be required to be so applied (A) until the aggregate amount of Net Cash Proceeds derived from all such Extraordinary Receipts in any fiscal year is equal to or greater than $500,000 (and then only in excess of such amount) and (B) if, at the election of the Borrower, such Loan Party or such Subsidiary reinvests all or any portion of such Net Cash Proceeds in Eligible Assets within three hundred sixty five (365) days of the date of receipt thereof; provided , further , that , for purposes of the foregoing clause (B) , if such Net Cash Proceeds shall have not been so reinvested by the end of such period, such Net Cash Proceeds shall be immediately applied to prepay the Loans. Any prepayment pursuant to this clause (ii) shall be applied as set forth in clause (iv) below.

(iii) Debt Issuance . The Borrower shall immediately upon the receipt by any Loan Party or any Subsidiary of the Net Cash Proceeds of any Debt Issuance, prepay the Obligations in an aggregate amount equal to 100% of such Net Cash Proceeds. Any prepayment pursuant to this clause (iii) shall be applied as set forth in clause (iv) below.

(iv) Application of Mandatory Prepayments . All payments under this Section 2.03(b) shall be applied first to all fees, costs, expenses, indemnities and other amounts due and payable hereunder, then proportionately (based on the relation of such amounts to the total amount of the relevant payment under this Section 2.03(b) ) to the payment or prepayment (as applicable) of the following amounts of the Obligations: default interest, if any, prepayment premium required by Section 2.03(d) , accrued interest and principal. Each such prepayment shall be applied (x) with respect to any such prepayment on or prior to June 30, 2021, ratably to the Term A Facility, the Term B-1 Facility, the Term B-2 Facility, the Term B-3 Facility and the Term C Facility and (y) with respect to any such prepayment after June 30, 2021, ratably to the Term A Facility, the Term B-1 Facility, the Term B-2 Facility, the Term B-3 Facility and the Term C Facility and to the principal repayment installments thereof on a pro rata basis. Each such prepayment shall be applied to the Loans of the Lenders in accordance with their respective Applicable Percentages in respect of each of the relevant Facilities.

(c) Change of Control . Upon the occurrence of a Change of Control, the Borrower shall, at the direction of the Required Lenders, and may, at its option upon three (3) Business Days’ prior written notice from the Borrower to the Administrative Agent, prepay the Outstanding Amount of the Loans together with all accrued and unpaid interest thereon plus the prepayment premium required by Section 2.03(d) plus all other Obligations. Each such direction or notice shall specify the date and amount of such prepayment. If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein; provided , that , any such notice of prepayment may indicate that such prepayment is conditioned upon the occurrence of such Change of Control and may be revoked by Borrower in the event such transaction is not consummated, and if so revoked, such prepayment shall not be due and payable. Each prepayment under this Section 2.03(c) shall be applied to the Loans of the Lenders in accordance with their respective Applicable Percentages in respect of each of the relevant Facilities.

(d) Prepayment Premiums . If all or any portion of the Loans are prepaid, or required to be prepaid, pursuant to this Section 2.03 , Article IX (whether by acceleration or otherwise) or otherwise, then, in all cases, the Borrower shall pay to the Lenders, for their respective ratable accounts, on the date on which such prepayment is paid or required to be paid, in addition to the other Obligations so prepaid or required to be prepaid, a prepayment premium equal to: (i) with respect to any prepayment paid or required to be paid on or prior to March 31, 2021, twenty percent (20.00%) of the principal amount of the Loans prepaid or required to be prepaid, (ii) with respect to any prepayment paid or required to be paid after March 31, 2021 but on or prior to March 31, 2022, fifteen percent (15.00%) of the principal amount of the Loans prepaid or required to be prepaid, and (iii) with respect to any prepayment paid or required to be paid thereafter, ten percent (10.00%) of the principal amount of the Loans prepaid or required to be prepaid.

2.04 Termination or Reduction of Commitments .

(a) Voluntary . The Borrower may, upon notice to the Administrative Agent during the Term B-1 Availability Period with respect to the Term B-1 Facility, during the Term B-2 Availability Period with respect to the Term B-2 Facility, during the Term B-3 Availability Period with respect to the Term B-3 Facility and during the Term C Availability Period with respect to the Term C Facility, terminate in full the Commitments under any Facility, or from time to time permanently reduce the Commitments under any Facility; provided , that : (i) any such notice shall be received by the

Administrative Agent not later than 11:00 a.m. five (5) Business Days prior to the date of termination or reduction and (ii) any such partial reduction shall be in an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess thereof; provided , further , that , any such notice of termination or reduction may indicate that such termination or reduction is conditioned upon the consummation of a refinancing of this Agreement, capital raising or a particular Disposition or the occurrence of a Change of Control and may be revoked by the Borrower in the event such refinancing or other transaction is not consummated, and if so revoked, such termination or reduction shall not be due and payable. Upon any termination or reduction of the Commitments under a Facility, the Commitments of each Appropriate Lender shall be reduced by such Lender’s Applicable Percentage of such reduction amount.

(b) Mandatory . The Commitments under the Term A Facility shall be automatically and permanently reduced to zero on the date of the Borrowing under such Facility pursuant to Section 2.01 . The Commitments under the Term B-1 Facility, the Term B-2 Facility and the Term B-3 Facility shall be automatically and permanently reduced to zero on the earlier of (x) the date of the Borrowing under such Term B-1 Facility, Term B-2 Facility or Term B-3 Facility, as applicable, pursuant to Section 2.01 and (y) the date that the Term B-1 Availability Period, Term B-2 Availability Period or the Term B-3 Availability Period, as applicable, shall end. The Term C Commitments shall be automatically and permanently reduced to zero on the earlier to occur of (x) the Borrower makes a fourth (4 ^th ) Term C Borrowing and (y) the Term C Availability Period shall end. Upon any reduction of the Commitments under a Facility, the Commitments of each Appropriate Lender shall be reduced by such Lender’s Applicable Percentage of such reduction amount.

2.05 Repayment of Loans.

(a) Term A Facility .

The Borrower shall repay the outstanding principal amount of the Term A Loans in installments on the dates set forth below, in each case, in the respective amounts set forth in the table below (which amounts shall be reduced as a result of the application of prepayments in accordance with the order of priority set forth in Section 2.03 ), unless accelerated sooner pursuant to Section 9.02 :



Payment Dates	Principal Amortization Payment (% of Principal Amount of Term A Facility Outstanding on June 30, 2021)
September 30, 2021	12.5%
December 31, 2021	12.5%
March 31, 2022	12.5%
June 30, 2022	12.5%
September 30, 2022	12.5%
December 31, 2022	12.5%
March 31, 2023	12.5%
Maturity Date	Outstanding Principal Balance of Term A Loans

provided , however , that , (x) the final principal repayment installment of the Term A Loans shall be repaid on the Maturity Date and in any event shall be in an amount equal to the aggregate principal amount of all Term A Loans outstanding on such date and (y) if any principal repayment installment to be made by the Borrower shall come due on a day other than a Business Day, such principal repayment installment shall be due on the first immediately preceding Business Day.

(b) Term B-1 Facility .

The Borrower shall repay the outstanding principal amount of the Term B-1 Loans in installments on the dates set forth below, in each case, in the respective amounts set forth in the table below (which amounts shall be reduced as a result of the application of prepayments in accordance with the order of priority set forth in Section 2.03 ), unless accelerated sooner pursuant to Section 9.02 :



Payment Dates	Principal Amortization Payment (% of Principal Amount of Term B-1 Facility Outstanding on June 30, 2021)
September 30, 2021	12.5%
December 31, 2021	12.5%
March 31, 2022	12.5%
June 30, 2022	12.5%
September 30, 2022	12.5%
December 31, 2022	12.5%
March 31, 2023	12.5%
Maturity Date	Outstanding Principal Balance of Term B-1 Loans

provided , however , that , (x) the final principal repayment installment of the Term B-1 Loans shall be repaid on the Maturity Date and in any event shall be in an amount equal to the aggregate principal amount of all Term B-1 Loans outstanding on such date and (y) if any principal repayment installment to be made by the Borrower shall come due on a day other than a Business Day, such principal repayment installment shall be due on the first immediately preceding Business Day.

The Borrower shall repay the outstanding principal amount of the Term B-2 Loans in installments on the dates set forth below, in each case, in the respective amounts set forth in the table below (which amounts shall be reduced as a result of the application of prepayments in accordance with the order of priority set forth in Section 2.03 ), unless accelerated sooner pursuant to Section 9.02 :



Payment Dates	Principal Amortization Payment (% of Principal Amount of Term B-2 Facility Outstanding on June 30, 2021)
September 30, 2021	12.5%
December 31, 2021	12.5%
March 31, 2022	12.5%
June 30, 2022	12.5%
September 30, 2022	12.5%
December 31, 2022	12.5%
March 31, 2023	12.5%
Maturity Date	Outstanding Principal Balance of Term B-2 Loans

provided , however , that , (x) the final principal repayment installment of the Term B-2 Loans shall be repaid on the Maturity Date and in any event shall be in an amount equal to the aggregate principal amount of all Term B-2 Loans outstanding on such date and (y) if any principal repayment installment to be made by the Borrower shall come due on a day other than a Business Day, such principal repayment installment shall be due on the first immediately preceding Business Day.

(d) Term B-3 Facility .

The Borrower shall repay the outstanding principal amount of the Term B-3 Loans in installments on the dates set forth below, in each case, in the respective amounts set forth in the table below (which amounts shall be reduced as a result of the application of prepayments in accordance with the order of priority set forth in Section 2.03 ), unless accelerated sooner pursuant to Section 9.02 :



Payment Dates	Principal Amortization Payment (% of Principal Amount of Term B-3 Facility Outstanding on June 30, 2021)
September 30, 2021	12.5%
December 31, 2021	12.5%
March 31, 2022	12.5%
June 30, 2022	12.5%
September 30, 2022	12.5%
December 31, 2022	12.5%
March 31, 2023	12.5%
Maturity Date	Outstanding Principal Balance of Term B-3 Loans

provided , however , that , (x) the final principal repayment installment of the Term B-3 Loans shall be repaid on the Maturity Date and in any event shall be in an amount equal to the aggregate principal amount of all Term B-3 Loans outstanding on such date and (y) if any principal repayment installment to be made by the Borrower shall come due on a day other

than a Business Day, such principal repayment installment shall be due on the first immediately preceding Business Day.

(e) Term C Facility .

The Borrower shall repay the outstanding principal amount of the Term C Loans in installments on the dates set forth below, in each case, in the respective amounts set forth in the table below (which amounts shall be reduced as a result of the application of prepayments in accordance with the order of priority set forth in Section 2.03 ), unless accelerated sooner pursuant to Section 9.02 :



Payment Dates	Principal Amortization Payment (% of Principal Amount of Term C Facility Outstanding on June 30, 2021)
September 30, 2021	12.5%
December 31, 2021	12.5%
March 31, 2022	12.5%
June 30, 2022	12.5%
September 30, 2022	12.5%
December 31, 2022	12.5%
March 31, 2023	12.5%
Maturity Date	Outstanding Principal Balance of Term C Loans

provided , however , that , (x) the final principal repayment installment of the Term C Loans shall be repaid on the Maturity Date and in any event shall be in an amount equal to the aggregate principal amount of all Term C Loans outstanding on such date and (y) if any principal repayment installment to be made by the Borrower shall come due on a day other than a Business Day, such principal repayment installment shall be due on the first immediately preceding Business Day.

2.06 Interest.

(a) Pre-Default Rate . Subject to the provisions of subsection (b) below, each Loan shall bear interest on the outstanding principal amount thereof for each Interest Period from the applicable borrowing date at a rate per annum equal to the Interest Rate for such Interest Period.

(b) Default Rate . (i) Upon the occurrence and during the existence of any Event of Default, all outstanding Obligations shall thereafter bear interest at an interest rate per annum at all times equal to the Interest Rate for the applicable Interest Period plus four percent (4.00%) per annum (the “ Default Rate ”), to the fullest extent permitted by applicable Laws and (ii) accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable in cash on demand.

(c) Interest Generally . Interest on each Loan shall be due and payable in arrears on each Interest Payment Date and at such other times as may be specified herein. Interest hereunder

shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.

2.07 Fees.

The Borrower shall pay to the Administrative Agent and the Lenders, for their own respective accounts, fees in the amounts and at the times specified in the Fee Letter. Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

2.08 Computation of Interest.

All computations of interest shall be made on the basis of a 360-day year and actual days elapsed. Interest shall accrue on each Loan for the day on which such Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which such Loan or such portion is paid.

2.09 Evidence of Debt.

The Loans made by each Lender shall be evidenced by one or more accounts or records maintained by such Lender in the ordinary course of business. The accounts or records maintained by each Lender shall be conclusive absent manifest error of the amount of Loans made by the Lenders to the Borrower and the interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Obligations. Upon the request of any Lender made through the Administrative Agent, the Borrower shall execute and deliver to such Lender a promissory note, which shall evidence such Lender’s Loans in addition to such accounts or records. Each such promissory note shall (i) in the case of the Term A Loans, be in the form of Exhibit B - 1 (a “ Term A Note ”), (ii) in the case of the Term B-1 Loans, be in the form of Exhibit B - 2 (a “ Term B-1 Note ”), (iii) in the case of the Term B-2 Loans, be in the form of Exhibit B - 3 (a “ Term B-2 Note ”), (iv) in the case of the Term B-3 Loans, be in the form of Exhibit B - 4 (a “ Term B-3 Note ”) and (v) in the case of the Term C Loans, be in the form of Exhibit B - 5 (a “ Term C Note ”). Each Lender may attach schedules to its Notes and endorse thereon the date, amount and maturity of its Loans and payments with respect thereto.

2.10 Payments Generally.

(a) General . All payments to be made by the Borrower shall be made free and clear of and without condition or (except as expressly provided in Section 3.01 ) deduction for any counterclaim, defense, recoupment or setoff. Subject to Section 9.03 , all payments of principal, interest, prepayment premiums and fees on the Loans and all other Obligations payable by any Loan Party under the Loan Documents shall be due, without any presentment thereof, directly to the Lenders, at the respective Lending Offices of the Lenders; provided , that , if at the time of any such payment a Lender is a Defaulting Lender, such Defaulting Lender’s pro rata share of such payment shall be made directly to the Administrative Agent. The Loan Parties will make such payments in Dollars, in immediately available funds not later than 2:00 p.m. on the date due, marked for attention as indicated, or in such other manner or to such other account in any United States bank as the Lenders may from time to time direct in writing. All payments received by the Lenders after 2:00 p.m. shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue. If any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest.

(b) Obligations of Lenders Several . The obligations of the Lenders hereunder to make Loans and to make payments pursuant to Section 11.04(c) are several and not joint. The failure of any Lender to make any Loan or to make any payment under Section 11.04(c) on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Loan or to make its payment under Section 11.04(c) .

(c) Funding Source . Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner.

2.11 Sharing of Payments by Lenders.

If any Lender shall, by exercising any right of setoff or otherwise, obtain payment in respect of any principal of or interest on its portion of any of the Loans or prepayment premium in connection therewith resulting in such Lender’s receiving payment of a proportion of the aggregate amount of the Loans and accrued interest thereon and prepayment premium in connection therewith greater than its pro rata share thereof as provided herein, then the Lender shall (a) notify the Administrative Agent of such fact and (b) purchase (for cash at face value) participations in the portions of the Loans of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of, accrued interest on and prepayment premium in connection with their respective portions of the Loans and other amounts owing them; provided , that :

(i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and

(ii) the provisions of this Section 2.11 shall not be construed to apply to (x) any payment made by or on behalf of the Borrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender) or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its portion of the Loans to any assignee or participant, other than an assignment to any Loan Party or any Subsidiary (as to which the provisions of this Section 2.11 shall apply).

Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable Law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against such Loan Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of such Loan Party in the amount of such participation.

2.12 Defaulting Lenders.

(a) Adjustments . Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:

(i) Waivers and Amendment . The Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of “Required Lenders” and Section 11.01 .

(ii) Reallocation of Payments . Any payment of principal, interest, fees or any other amount received by the Administrative Agent for the account of that Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article IX or otherwise, and including any amounts made available to the Administrative Agent by that Defaulting Lender pursuant to Section 11.08 ), shall be applied at such time or times as may be determined by the Administrative Agent as follows: first , to the payment of any amounts owing by that Defaulting Lender to the Administrative Agent hereunder; second , as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which that Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; third , if so determined by the Administrative Agent and the Borrower, to be held in a non-interest bearing deposit account and released in order to satisfy obligations of that Defaulting Lender to fund Loans under this Agreement; fourth , to the payment of any amounts owing to the Lenders as a result of any judgment of a court of competent jurisdiction obtained by any Lender against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; fifth , so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; and sixth , to that Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided , that , if (x) such payment is a payment of the principal amount of any Loans in respect of which that Defaulting Lender has not fully funded its appropriate share and (y) such Loans were made at a time when the conditions set forth in Section 5.03 were satisfied or waived, such payment shall be applied solely to pay the Loans of all non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of that Defaulting Lender. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender pursuant to this Section 2.12(a)(ii) shall be deemed paid to and redirected by that Defaulting Lender, and each Lender irrevocably consents hereto.

(b) Defaulting Lender Cure . If the Borrower and the Administrative Agent agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein, that Lender will cease to be a Defaulting Lender; provided , that , no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; provided , further , that , except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender having been a Defaulting Lender.

2.13 Right of First Offer.

(a) If the Borrower or any Subsidiary contemplates undertaking an issuance of any Indebtedness (other than (x) Indebtedness permitted under Section 8.03(a) , (c) , (d) , (e) , (f) , (j) , (k) or (m) or (y) Indebtedness in an aggregate principal amount below the Threshold Amount), then, not less than thirty (30) Business Days prior to the proposed date of such issuance, the Borrower shall provide written notice (a “ Debt Issuance Notice ”) thereof to the Lenders, and shall deliver promptly to the Lenders such information concerning such issuance as the Lenders may reasonably request.

(b) For a period of twenty (20) Business Days (the “ Exclusivity Period ”) after receipt by the Lenders of a Debt Issuance Notice, the Lenders shall have the exclusive option, but not the obligation, to propose the material terms and conditions (the “ Proposed Terms ”) under which they would be willing to provide such Indebtedness by delivering written notice (a “ Proposed Term Sheet ”) thereof to the Borrower, setting forth such Proposed Terms. Failure by the Lenders to deliver a Proposed Term Sheet within the applicable Exclusivity Period shall be deemed an election by the Lenders not to provide such Indebtedness. If the Lenders deliver a Proposed Term Sheet to the Borrower that purports to provide not less than the aggregate amount of financing contemplated by the issuance contemplated in the Debt Issuance Notice, then neither the Borrower nor any Subsidiary may then undertake any such issuance with any other Person unless such issuance with such other Person (x) includes financial covenants and events of default and other terms including amortization, mandatory prepayments and maturity dates that are more favorable (taken as a whole) to the Borrower and its Subsidiaries than the Indebtedness contemplated by the Proposed Term Sheet (such determination to be made by the Borrower in good faith) and (y) has an All-In-Yield that is less than the All-In-Yield of the Indebtedness contemplated by the Proposed Term Sheet; provided , that , prior to undertaking any such issuance with any other Person, the Borrower or such Subsidiary shall provide the Lenders with at least ten (10) Business Days’ notice thereof (and such information with respect thereto as the Lenders shall reasonably request) and afford the Lenders a period of five (5) Business Days thereafter to propose a Proposed Term Sheet containing economic terms at least as favorable to the Borrower or such Subsidiary as the economic terms of such Indebtedness.

2.14 Term C Facility.

At any time on or after the Funding Date but prior to June 30, 2020, upon prior written notice by the Borrower to the Administrative Agent, the Borrower may establish the Term C Facility in an aggregate amount not to exceed TEN MILLION DOLLARS ($10,000,000); provided , that ,

(a) (i) the aggregate principal amount of each Borrowing under the Term C Facility shall be in a principal amount of $2,500,000 and (ii) there shall not be more than four (4) Borrowings under the Term C Facility;

(b) the Borrower shall have drawn the full amount of the Term B-1 Facility, the Term B-2 Facility and the Term B-3 Facility pursuant to Section 2.01(b) ;

(c) no existing Lender shall be under any obligation to make any Term C Loan and any such decision whether to make a Term C Loan shall be in such Lender’s sole and absolute discretion;

(d) (i) no Default or Event of Default shall exist and be continuing at the time of the establishment of the Term C Facility, (ii) the Term C Facility shall only be used to fund Approved Strategic Investments and to pay fees and expenses in connection therewith and (iii) the conditions precedent set forth in Section 5.04 shall have been satisfied prior to or contemporaneously with funding of any Term C Loans;

(e) the maturity date for the Term C Facility shall be the Maturity Date and the scheduled principal amortization payments under the Term C Facility shall be as set forth in Section 2.05(e) ;

(f) the Borrower shall have paid all fees required to be paid in connection therewith, whether pursuant to the Fee Letter or otherwise;

(g) the Term C Lenders, the Administrative Agent and the Loan Parties shall have entered into such technical amendments to this Agreement as are necessary, in the Administrative Agent’s reasonable discretion, to effect the inclusion of the Term C Facility herein;

(h) the Borrower shall have obtained commitments for the aggregate amount of the Term C Facility from existing Lenders pursuant to joinder documentation reasonably satisfactory to the Administrative Agent; and

(i) the Borrower shall have delivered to the Administrative Agent a certificate of each Loan Party dated as of the date of such institution and effectiveness (in sufficient copies for each Lender) signed by a Responsible Officer of such Loan Party (i) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to the Term C Facility and (ii) certifying that, before and after giving effect to the Term C Facility, (x) the representations and warranties contained in Article VI and the other Investments Documents are true and correct in all respects on and as of the date of such increase, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all respects as of such earlier date, and except that for purposes of this Section 2.14 , the representations and warranties contained in subsections (a) and (b) of Section 6.05 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a)(i) and (b) , respectively, of Section 7.01 and (y) no Default or Event of Default exists.

ARTICLE III.

TAXES

3.01 Taxes.

(a) Except as required by applicable Law, all payments of principal and interest on the Loans and all other amounts payable hereunder shall be made free and clear of and without deduction for any present or future income, excise, stamp, documentary, property or franchise taxes, VAT and other taxes, fees, duties, levies, assessments, withholdings or other charges of any nature whatsoever (including interest and penalties thereon) imposed by any taxing authority, excluding (x) taxes imposed on or measured by net income imposed by the jurisdiction (or any political subdivision thereof) under which a Recipient is organized or in which such Recipient has its principal office, applicable Lending Office or with which such Recipient otherwise has a present or former connection (other than solely as the result of entering into any of the Loan Documents or taking any action thereunder), (y) U.S. federal withholding taxes imposed on amounts payable to or for the account of a Recipient with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Recipient acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by the Borrower pursuant to Section 11.13 ) or (ii) such Recipient changes its Lending Office, except in each case to the extent that, pursuant to this Section 3.01 , amounts with respect to such taxes were payable either to such Recipient’s assignor immediately before such Recipient became a party hereto or to such Recipient immediately before it changed its Lending Office and (z) U.S. federal withholding tax imposed under FATCA (all non-excluded items being called “ Taxes ”). If any withholding or deduction of any Taxes from any payment by or on account of any obligation of any Loan Party hereunder is required in respect of any Taxes pursuant to any applicable Law, then (i) the applicable Withholding Agent shall be entitled to make such withholding or deduction and shall pay directly to the relevant Governmental Authority the full amount required to be so withheld or deducted, (ii) the applicable Withholding Agent shall

promptly forward to the Administrative Agent an official receipt or other documentation reasonably satisfactory to the Administrative Agent evidencing such payment to such Governmental Authority and (iii) the sum payable by the applicable Loan Party shall be increased by such additional amount or amounts as is necessary to ensure that the net amount actually received by the applicable Recipient will equal the full amount such Recipient would have received had no such withholding or deduction for Taxes been required.

(b) The Borrower or the Guarantors, as applicable, shall indemnify each Recipient, within ten (10) days after demand therefor, for the full amount of any Taxes (including Taxes imposed on or attributable to amounts payable under this Section 3.01 ) payable or paid by such Recipient or required to be withheld or deducted from a payment by such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.

(c) (i) Any Lender that is entitled to an exemption from or reduction of withholding tax, including under FATCA, with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation prescribed by applicable Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Internal Revenue Code) or reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable Law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.01(c)(ii) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(ii) Each Lender that is not a “United States person” as defined in Section 7701(a)(30) of the Internal Revenue Code that purports to become an assignee of an interest pursuant to Section 11.06 after the Effective Date (each such Lender a “ Foreign Lender ”) shall, to the extent it is legally entitled to do so, execute and deliver to each of the Borrower and the Administrative Agent on or prior to the date that such Lender becomes a party hereto (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), one or more (as the Borrower or the Administrative Agent may reasonably request) duly completed and executed copies of United States Internal Revenue Service Forms W-8ECI, W-8BEN, W-8BEN-E, W-8IMY and other certification documents from each beneficial owner (as applicable). Each Lender that is a “United States person” as defined in Section 7701(a)(30) of the Internal Revenue Code shall execute and deliver to the Borrower and the Administrative Agent on or prior to the date such Lender becomes a party hereto (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), one or more (as the Borrower or the Administrative Agent may reasonably request) duly completed and executed copies of United States Internal Revenue Service Form W-9 certifying that such Lender is not subject to United States backup withholding.

(iii) The Borrower shall not be required to pay additional amounts to any Lender pursuant to this Section 3.01 with respect to taxes attributable to the failure of such Foreign Lender to comply with this Section 3.01(c) , and such taxes shall be excluded from the definition of Taxes.

(d) Each Lender agrees that if any form or certification it previously delivered pursuant to this Section 3.01 expires or becomes obsolete or inaccurate in any respect, it shall promptly update such form or certification or promptly notify the Administrative Agent and the Borrower of its inability to do so.

(e) If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.01 (including by the payment of additional amounts pursuant to this Section 3.01 ), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this clause (e) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this clause (e) , in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this clause (e) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This paragraph shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

3.02 Increased Costs.

(a) Increased Costs Generally . If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement contemplated by Section 3.02(d) ;

(ii) subject any Recipient to any taxes (other than (A) Taxes that are covered by Section 3.01(b) and (B) taxes that are excluded from the definition of Taxes in Section 3.01(a) ) on its loans, loan principal, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

(iii) impose on any Lender or the London interbank market any other condition, cost or expense (other than taxes) affecting this Agreement;

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Loan (or of maintaining its obligation to make any such Loan), then, upon request of such Lender, the Borrower will pay to such Lender, as the case may be, such additional amount

or amounts as will compensate such Lender, as the case may be, for such additional costs incurred or reduction suffered.

(b) Capital Requirements . If any Lender determines that any Change in Law affecting such Lender or any Lending Office of such Lender or such Lender’s holding company, if any, regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by such Lender to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy), then from time to time the Borrower will pay to such Lender, as the case may be, such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

(c) Certificates for Reimbursement . A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in subsection (a) or (b) of this Section and delivered to the Borrower shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.

(d) Reserves on Loans . The Borrower shall pay to each Lender, (i) as long as such Lender shall be required to maintain reserves with respect to liabilities or assets consisting of or including eurocurrency funds or deposits (currently known as “Eurocurrency liabilities”), additional interest on the unpaid principal amount of each Loan equal to the actual costs of such reserves allocated to such Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive), and (ii) as long as such Lender shall be required to comply with any reserve ratio requirement or analogous requirement of any central banking or financial regulatory authority imposed in respect of the maintenance of the Commitments or the funding of the Loans, such additional costs (expressed as a percentage per annum and rounded upwards, if necessary, to the nearest five decimal places) equal to the actual costs allocated to such Commitment or Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive), which in each case shall be due and payable on each date on which interest is payable on such Loan; provided , that , the Borrower shall have received at least ten (10) days’ prior notice (with a copy to the Administrative Agent) of such additional interest or costs from such Lender. If a Lender fails to give notice ten (10) days prior to the relevant Interest Payment Date, such additional interest shall be due and payable ten (10) days from receipt of such notice.

(e) Delay in Requests . Failure or delay on the part of any Lender to demand compensation pursuant to the foregoing provisions of this Section shall not constitute a waiver of such Lender’s right to demand such compensation, provided , that , the Borrower shall not be required to compensate a Lender pursuant to the foregoing provisions of this Section for any increased costs incurred or reductions suffered more than nine (9) months prior to the date that such Lender notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).

3.03 Mitigation Obligations; Replacement of Lenders.

(a) Designation of a Different Lending Office . If any Lender requests compensation under Section 3.02 or requires the Borrower to pay any Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01 , or if any Lender gives a notice pursuant to Section 3.02 , then at the request of the Borrower such Lender shall, as applicable, use reasonable efforts to designate a different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.01 or 3.02 , as the case may be, in the future, or eliminate the need for the notice pursuant to Section 3.02 , as applicable, and (ii) in each case, would not subject such Lender, as the case may be, to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

(b) Replacement of Lenders . If any Lender requests compensation under Section 3.02 , or if the Borrower is required to pay any Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01 and, in each case, such Lender has declined or is unable to designate a different Lending Office in accordance with Section 3.03(a) , the Borrower may replace such Lender in accordance with Section 11.13 .

3.04 Illegality.

If any Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its Lending Office to perform any of its obligations hereunder or to make, maintain or fund or charge interest with respect to any Borrowing, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, any obligation of such Lender to issue, make, maintain, fund or charge interest with respect to any such Borrowing or to make Loans shall be suspended until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the Borrower shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay the Loans immediately. Upon any such prepayment, the Borrower shall also pay accrued interest on the amount so prepaid.

3.05 Three-Month LIBOR Unavailability Period .

Notwithstanding anything to the contrary in this Agreement or any other Loan Document, if the Administrative Agent determines (which determination shall be conclusive absent manifest error) that a LIBOR Unavailability Period has commenced and is continuing, then, reasonably promptly after such determination, the Administrative Agent shall give the Borrower notice thereof and the Administrative Agent and the Borrower may amend this Agreement to replace Three-Month LIBOR with an alternate benchmark rate (including any mathematical or other adjustments to the benchmark (if any) incorporated therein), giving due consideration to any evolving or then existing convention for similar U.S. dollar denominated credit facilities for such alternative benchmarks (any such proposed rate, a “ LIBOR Successor Rate ”), together with any proposed LIBOR Successor Rate Conforming Changes and any such amendment shall become effective at 5:00 p.m. (New York time) on the fifth (5 ^th ) Business Day after the Administrative Agent shall have posted such proposed amendment to all Lenders and the Borrower unless, prior to such time, Lenders

comprising the Required Lenders have delivered to the Administrative Agent written notice that such Required Lenders do not accept such amendment. It is understood and agreed that, for all purposes of this Agreement, once commenced, a “LIBOR Unavailability Period” shall be deemed to exist and be continuing unless and until such amendment has become effective in accordance with the terms hereof.

During the continuance of any LIBOR Unavailability Period, the obligation of the Lenders to make or maintain Loans with an Interest Rate calculated based on Three-Month LIBOR shall be suspended and the Borrower may revoke any pending request for a Borrowing of Loans with an Interest Rate calculated based on Three-Month LIBOR or, failing that, will be deemed to have converted such request into a request for a Borrowing of Loans with an Interest Rate calculated based on the Prime Rate.

Notwithstanding anything else herein, any definition of LIBOR Successor Rate shall provide that in no event shall such LIBOR Successor Rate be less than zero for purposes of this Agreement.

3.06 Survival

All of the Borrower’s obligations under this Article III shall survive termination of the Commitments, repayment of all Obligations and resignation of the Administrative Agent.

ARTICLE IV.

GUARANTY

4.01 The Guaranty.

Each of the Guarantors hereby jointly and severally guarantees to each Secured Party as hereinafter provided, as primary obligor and not as surety, the prompt payment of the Obligations in full when due (whether at stated maturity, as a mandatory prepayment, by acceleration or otherwise) strictly in accordance with the terms thereof. The Guarantors hereby further agree that if any of the Obligations are not paid in full when due (whether at stated maturity, as a mandatory prepayment, by acceleration or otherwise), the Guarantors will, jointly and severally, promptly pay the same, without any demand or notice whatsoever, and that in the case of any extension of time of payment or renewal of any of the Obligations, the same will be promptly paid in full when due (whether at extended maturity, as a mandatory prepayment, by acceleration or otherwise) in accordance with the terms of such extension or renewal.

Notwithstanding any provision to the contrary contained herein or in any other of the Loan Documents, the obligations of each Guarantor under this Agreement and the other Loan Documents shall be limited to an aggregate amount equal to the largest amount that would not render such obligations subject to avoidance under Debtor Relief Laws or any comparable provisions of any applicable state law.

4.02 Obligations Unconditional.

The obligations of the Guarantors under Section 4.01 are joint and several, absolute and unconditional, irrespective of the value, genuineness, validity, regularity or enforceability of any of the Loan Documents, or any other agreement or instrument referred to therein, or any substitution, release, impairment or exchange of any other guarantee of or security for any of the Obligations, and, to the fullest extent permitted by applicable law, irrespective of any law or regulation or other circumstance whatsoever which might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor, it being the intent of this Section 4.02 that the obligations of the Guarantors hereunder shall be absolute and unconditional under

any and all circumstances. Each Guarantor agrees that such Guarantor shall have no right of subrogation, indemnity, reimbursement or contribution against the Borrower or any other Guarantor for amounts paid under this Article IV until such time as the Obligations (other than contingent indemnification obligations for which no claim has been asserted) have been paid in full and the Commitments have expired or terminated. Without limiting the generality of the foregoing, it is agreed that, to the fullest extent permitted by law, the occurrence of any one or more of the following shall not alter or impair the liability of any Guarantor hereunder, which shall remain absolute and unconditional as described above:

(a) at any time or from time to time, without notice to any Guarantor, the time for any performance of or compliance with any of the Obligations shall be extended, or such performance or compliance shall be waived;

(b) any of the acts mentioned in any of the provisions of any of the Loan Documents, or any other agreement or instrument referred to in the Loan Documents shall be done or omitted;

(c) the maturity of any of the Obligations shall be accelerated, or any of the Obligations shall be modified, supplemented or amended in any respect, or any right under any of the Loan Documents, or any other agreement or instrument referred to in the Loan Documents shall be waived or any other guarantee of any of the Obligations or any security therefor shall be released, impaired or exchanged in whole or in part or otherwise dealt with;

(d) any Lien granted to, or in favor of, any Secured Party as security for any of the Obligations shall fail to attach or be perfected; or

(e) any of the Obligations shall be determined to be void or voidable (including, without limitation, for the benefit of any creditor of any Guarantor) or shall be subordinated to the claims of any Person (including, without limitation, any creditor of any Guarantor).

With respect to its obligations hereunder, each Guarantor hereby expressly waives, to the extent permitted by applicable Law, diligence, presentment, demand of payment, protest and all notices whatsoever, and any requirement that the Secured Parties exhaust any right, power or remedy or proceed against any Person under any of the Loan Documents, or any other agreement or instrument referred to in the Loan Documents, or against any other Person under any other guarantee of, or security for, any of the Obligations.

4.03 Reinstatement.

The obligations of the Guarantors under this Article IV shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of any Person in respect of the Obligations is rescinded or must be otherwise restored by any Secured Party, whether as a result of any proceedings in bankruptcy or reorganization or otherwise, and each Guarantor agrees that it will indemnify the Secured Parties on demand for all reasonable costs and expenses (including, without limitation, the fees, charges and disbursements of counsel) incurred by the Secured Parties in connection with such rescission or restoration, including any such costs and expenses incurred in defending against any claim alleging that such payment constituted a preference, fraudulent transfer or similar payment under any bankruptcy, insolvency or similar law.

4.04 Certain Additional Waivers.

Each Guarantor agrees that such Guarantor shall have no right of recourse to security for the Obligations, except through the exercise of rights of subrogation pursuant to Section 4.02 and through the

exercise of rights of contribution pursuant to Section 4.06 . For the avoidance of doubt and notwithstanding the fact that the obligations of each Brazilian Guarantor under this Article IV are governed by the law of the State of New York, each Brazilian Guarantor hereby irrevocably and unconditionally waives the benefits of Articles 827, 829, 830, 834, 835, 837, 838 and 839 of Law No. 10,406, of January 10, 2002 and Articles 130 and 794 of Law No. 10,105, of March 16, 2015.

4.05 Remedies.

The Guarantors agree that, to the fullest extent permitted by law, as between the Guarantors, on the one hand, and the Secured Parties, on the other hand, the Obligations may be declared to be forthwith due and payable as provided in Section 9.02 (and shall be deemed to have become automatically due and payable in the circumstances provided in said Section 9.02 ) for purposes of Section 4.01 notwithstanding any stay, injunction or other prohibition preventing such declaration (or preventing the Obligations from becoming automatically due and payable) as against any other Person and that, in the event of such declaration (or the Obligations being deemed to have become automatically due and payable), the Obligations (whether or not due and payable by any other Person) shall forthwith become due and payable by the Guarantors for purposes of Section 4.01 . The Guarantors acknowledge and agree that their obligations hereunder are secured in accordance with the terms of the Collateral Documents and that the Secured Parties may exercise their remedies thereunder in accordance with the terms thereof.

4.06 Rights of Contribution.

The Guarantors agree among themselves that, in connection with payments made hereunder, each Guarantor shall have contribution rights against the other Guarantors as permitted under applicable law. Such contribution rights shall be subordinate and subject in right of payment to the obligations of such Guarantors under the Loan Documents and no Guarantor shall exercise such rights of contribution until all Obligations (other than contingent indemnification obligations for which no claim has been asserted) have been paid in full and the Commitments have terminated.

4.07 Guarantee of Payment; Continuing Guarantee.

The guarantee in this Article IV is a guaranty of payment and not of collection, is a continuing guarantee, and shall apply to all Obligations whenever arising.

4.08 Limitations Applicable to Belgian Loan Parties.

(a) The total liability of a Belgian Loan Party for the Obligations of any other Loan Party under the Loan Documents shall at all times be limited to an amount (without double counting) not exceeding the sum of:

(i) the aggregate of all principal amounts, either directly or through one or more other Loan Parties (through intra-group loans or otherwise and whether retained for its own purposes or on-lent) made available to such Belgian Loan Party (or its direct or indirect Subsidiaries) under any intra-group arrangement (including through the subscription of debt instruments) using proceeds made available pursuant to this Agreement; plus

(ii) ninety-five percent (95%) of such Belgian Loan Party’s own net assets ( netto actief/actif net ) (as determined in accordance with the second paragraph of article 320, 429 or 617 of the Belgian Companies Code (as applicable) and accounting principles generally accepted in Belgium and ignoring the Guaranty of such Belgian Loan Party) as shown by

its most recent audited unconsolidated annual financial statements at the date on which the demand is made on it.

(b) No Belgian Loan Party shall be liable for the Obligations of any other Loan Party under the Loan Documents to the extent that such liability would result in such guarantee constituting unlawful financial assistance within the meaning of Article 329, 430 or 629 of the Belgian Companies Code (as applicable).

ARTICLE V.

CONDITIONS PRECEDENT TO BORROWINGS

5.01 Condition to Effectiveness.

This Agreement shall become effective upon receipt by the Administrative Agent of executed counterparts of this Agreement, properly executed by a Responsible Officer of each Loan Party and by each Lender, together with all exhibits and schedules hereto.

5.02 Conditions to Initial Extensions of Credit.

The obligation of each Lender to make its initial Loans hereunder is subject to satisfaction of the following conditions precedent:

(a) Investment Documents . Receipt by the Administrative Agent of executed counterparts of the Investment Documents, each properly executed by a Responsible Officer of the signing Loan Party and each other party to such documents, including, without limitation, the Share Purchase Agreement and the ROFR Side Letter, in each case in form and substance reasonably satisfactory to the Administrative Agent and the Lenders.

(b) Opinions of Counsel . Receipt by the Administrative Agent of favorable opinions of legal counsel to the Loan Parties, addressed to the Administrative Agent and each Lender, dated as of the Funding Date, and in form and substance reasonably satisfactory to the Administrative Agent.

(c) Financial Statements; Due Diligence . The Administrative Agent shall have received the Audited Financial Statements, the Interim Financial Statements and such other reports, statements and due diligence items as the Administrative Agent or any Lender shall request.

(d) No Material Adverse Change . There shall not have occurred a material adverse change since December 31, 2016 in the business, financial performance or condition, operations (including the financial results thereof), assets or properties of the Borrower and its Subsidiaries, taken as a whole.

(e) Litigation . There shall not exist any action, suit, investigation or proceeding pending or threatened (in writing) in any court or before an arbitrator or Governmental Authority that could reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect.

(f) Organization Documents, Resolutions, Etc. Receipt by the Administrative Agent of the following, each of which shall be originals or facsimiles (followed promptly by originals), in form and substance reasonably satisfactory to the Administrative Agent and its legal counsel:

(i) copies of the Organization Documents of each Loan Party certified to be true and complete as of a recent date by (A) the appropriate Governmental Authority of the state or other jurisdiction of its incorporation or organization, where applicable, or (B) in the case of each Costa Rican Loan Party, a notarial certification, and in each case certified by a director, secretary or assistant secretary of such Loan Party to be true and correct as of the Funding Date;

(ii) such certificates of resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of each Loan Party as the Administrative Agent may require evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Agreement and the other Investment Documents to which such Loan Party is a party;

(iii) such documents and certifications as the Administrative Agent may require to evidence that each Loan Party is duly organized or formed, and is validly existing, in good standing and qualified to engage in business in its state or other jurisdiction of organization or formation (such certifications to include, without limitation, a good standing certificate of the Borrower issued by the Registrar of Corporate Affairs in the British Virgin Islands);

(iv) a registered agent’s certificate issued by the Borrower’s registered agent in the British Virgin Islands and dated within one month of the Effective Date;

(v) a copy of a resolution of the Board of Directors of each Belgian Loan Party setting out the reasons it is considered that the entry into this Agreement, and in particular the assumption of its guaranty obligations in accordance with Article IV , is of benefit to such Belgian Loan Party;

(vi) in relation to each Belgian Loan Party, a solvency certificate ( attest niet-faillissement/certificat de non-faillite ) and an uittreksel van de Kruispuntbank voor Ondernemingen/extrait de la Banque Carrefour des Entreprises , each dated not more than three (3) Business Days prior to the Effective Date; and

(vii) a certificate of the Articles of Incorporation and organizational documents, and a recent certificación de personería jurídica , of each Costa Rican Loan Party.

(g) Perfection and Priority of Liens . Receipt by the Administrative Agent of the following:

(i) searches of Uniform Commercial Code filings (or the equivalent) in the jurisdiction of formation of each Loan Party or where a filing would need to be made in order to perfect the Administrative Agent’s security interest in the Collateral, copies of the financing statements (or the equivalent) on file in such jurisdictions and evidence that no Liens exist other than Permitted Liens;

(ii) Uniform Commercial Code (or the equivalent) financing statements for each appropriate jurisdiction as is necessary, in the Administrative Agent’s sole discretion, to perfect the Administrative Agent’s security interest in the Collateral and filings of the particulars of the relevant charges with the Registrar of Corporate Affairs in the British Virgin Islands in accordance with Section 163 of the BVI Business Companies Act, 2004;

(iii) (A) all certificates evidencing any certificated Equity Interests pledged to the Administrative Agent pursuant to any Pledge Agreement or any Security Agreement other than the Costa Rican Security Trust Agreement, together with duly executed in blank and undated stock powers attached thereto and (B) all certificates evidencing the delivery of any share certificates of any Costa Rican Loan Party to the Trustee pursuant to the Costa Rican Security Trust Agreement, together with the entries in each such Costa Rican Loan Party’s Shareholders Registry Book and Shareholders Meeting Minutes Book regarding the transfer of said secured shares to the Trustee;

(iv) searches of ownership of, and Liens on, the Business IP Rights of the Loan Parties in the appropriate governmental offices;

(v) duly executed notices of grant of security interest in the form required by the applicable Security Agreement as are necessary, in the Administrative Agent’s sole discretion, to perfect the Administrative Agent’s security interest in the Business IP Rights of the Loan Parties;

(vi) such Qualifying Control Agreements as shall be necessary to cause the Loan Parties to be in compliance with Section 7.18 ;

(vii) to the extent required to be delivered pursuant to the terms of the Collateral Documents, all instruments, documents and chattel paper in the possession of any of the Loan Parties, together with allonges or assignments as may be necessary or appropriate to perfect the Administrative Agent’s security interest in the Collateral; and

(viii) in the case of any personal property Collateral located at a premises leased by a Loan Party, such Collateral Access Agreements as may be required by the Administrative Agent.

(h) Real Property Collateral . Receipt by the Administrative Agent of Mortgages and other Real Property Security Documents with respect to the fee interest of any Loan Party in each real property identified on Schedule 6.20(a) to the Disclosure Letter (other than any Excluded Property).

(i) Evidence of Insurance . Receipt by the Administrative Agent of copies of insurance policies or certificates of insurance of the Loan Parties evidencing liability and casualty insurance meeting the requirements set forth in the Loan Documents, including, but not limited to, naming the Administrative Agent as additional insured (in the case of liability insurance) or Lender’s loss payee (in the case of hazard insurance) on behalf of the Secured Parties.

(j) Funding Certificate . Receipt by the Administrative Agent of a certificate signed by a Responsible Officer of the Borrower certifying (i) that the conditions specified in Sections 5.02(d) , (e) and (l) and Sections 5.03(a) and (b) have been satisfied, (ii) that the Borrower and its Subsidiaries (after giving effect to the transactions contemplated hereby and the incurrence of Indebtedness related thereto) are Solvent on a consolidated basis and (iii) that neither the Borrower nor any Subsidiary as of the Funding Date has outstanding any Disqualified Capital Stock.

(k) Existing Indebtedness .

(i) All of the existing Indebtedness for borrowed money of the Loan Parties and their respective Subsidiaries (including all Indebtedness under the Existing Credit Agreement but, for the avoidance of doubt, excluding (A) Indebtedness permitted to exist pursuant to Section 8.03 and (B) the Crown Predator Convertible Indebtedness), shall be repaid in full and all security interests related thereto shall be terminated on or prior to the Funding Date.

(ii) All of the Crown Predator Convertible Indebtedness shall be either (A) repaid in full or (B) converted into Qualified Capital Stock of the Borrower, and in each case all security interests related thereto shall be terminated on or prior to the Funding Date.

(l) Governmental and Third Party Approvals . The Loan Parties and their respective Subsidiaries shall have received all governmental, shareholder and third party consents and approvals necessary in connection with the transactions contemplated by this Agreement and the other Investment Documents and the other transactions contemplated hereby and all applicable waiting periods shall have expired without any action being taken by any Person that could reasonably be expected to restrain, prevent or impose any material adverse conditions on the Loan Parties or any of their respective Subsidiaries or such other transactions or that could seek to threaten any of the foregoing, and no law or regulation shall be applicable which could reasonably be expected to have such effect.

(m) Corporate Structure and Capitalization . The capital and ownership structure and the equity holder arrangements of the Borrower and its Subsidiaries on the Funding Date, on a pro forma basis after giving effect to the transactions contemplated by the Investment Documents shall be reasonably satisfactory to the Lenders.

(n) Letter of Direction . Receipt by the Administrative Agent of a satisfactory letter of direction containing funds flow information with respect to the proceeds of the Loans to be made on the Funding Date.

(o) Fees . Receipt by the Administrative Agent and the Lenders of any fees required to be paid on or before the Funding Date.

(p) Attorney Costs; Due Diligence Expenses . The Borrower shall have paid all fees, charges and disbursements of counsel to the Administrative Agent incurred to the Funding Date, plus such additional amounts of such fees, charges and disbursements as shall constitute its reasonable estimate of such fees, charges and disbursements incurred or to be incurred by it through the closing proceedings ( provided , that , such estimate shall not thereafter preclude a final settling of accounts between the Borrower and the Administrative Agent).

(q) Condition to Effectiveness . The condition to effectiveness specified in Section 5.01 shall have been satisfied.

(r) Equity Documents . Receipt by the Administrative Agent of a certificate signed by a Responsible Officer of the Borrower attaching executed copies of each document necessary to effectuate the Share Purchase Agreement and authorize the Borrower’s entry into the ROFR Side Letter, including, without limitation, (i) the Restated Articles, (ii) the Rights Agreement, (iii) the

Voting Agreement and (iv) ROFR Agreement, in each case as such terms are defined in the Share Purchase Agreement and in form and substance satisfactory to the Lenders.

(s) Termination of the Banco Davivienda Documents . The Banco Davivienda Documents shall be terminated, all existing Indebtedness under the Banco Davivienda Documents shall be repaid in full and all security interests related thereto shall be terminated on or prior to the Funding Date.

(t) Cancellation of Certain Warrants . The Borrower shall have cancelled the Relativity Warrant, JW Opportunities Warrant and JW Partners Warrant on or prior to the Funding Date, on terms and conditions satisfactory to the Administrative Agent.

(u) Perceptive Warrant . The Borrower shall have committed to repurchase fifty percent (50%) of the Perceptive Warrant on or prior to the Funding Date on terms and conditions satisfactory to the Administrative Agent and the Lenders, and the Lenders shall have purchased the other fifty percent (50%) of the Perceptive Warrant from Perceptive Credit Holdings, LP on or prior to the Funding Date on terms and conditions satisfactory to the Administrative Agent and the Lenders.

(v) Equity Purchases . The Lenders shall have purchased (i) 73,560 Class A ordinary shares of the Borrower from Antoun Nabhan, (ii) 13,580 Class A ordinary shares of the Borrower from Marco Chacon Quiros and (iii) 80,000 Class A ordinary shares of the Borrower from Medical Device Holdings, S.A., in each case, on or prior to the Funding Date and on terms and conditions satisfactory to the Administrative Agent and the Lenders.

(w) Other . Receipt by the Administrative Agent and the Lenders of such other documents, instruments, agreements and information as reasonably requested by the Administrative Agent or any Lender, including, but not limited to, information regarding litigation, tax, accounting, labor, insurance, pension liabilities (actual or contingent), real estate leases, material contracts, debt agreements, property ownership, environmental matters, contingent liabilities and management of the Borrower and its Subsidiaries.

Without limiting the generality of the provisions of the last paragraph of Section 10.03 , for purposes of determining compliance with the conditions specified in this Section 5.02 , each Lender that has funded its Term A Loan on the Funding Date shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Funding Date specifying its objection thereto.

5.03 Conditions to all Borrowings.

The obligation of each Lender to honor any Loan Notice is subject to the following conditions precedent:

(a) The representations and warranties of the Borrower and each other Loan Party contained in Article VI or any other Investment Document, or which are contained in any document furnished at any time under or in connection herewith or therewith, shall be true and correct in all material respects (and in all respects if any such representation or warranty is already qualified by materiality or reference to Material Adverse Effect) on and as of the date of such Borrowing, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects (and in all respects if any such representation

or warranty is already qualified by materiality or reference to Material Adverse Effect) as of such earlier date, and except that for purposes of this Section 5.03 , the representations and warranties contained in subsections (a) and (b) of Section 6.05 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a)(i) and (b) , respectively, of Section 7.01 .

(b) No Default or Event of Default shall exist, or would result from such proposed Borrowing or from the application of the proceeds thereof.

(c) With respect to any Loan Notice requesting a Borrowing of Term B-1 Loans, the requested Borrowing shall occur during the Term B-1 Availability Period.

(d) With respect to any Loan Notice requesting a Borrowing of Term B-2 Loans, the requested Borrowing shall occur during the Term B-2 Availability Period.

(e) With respect to any Loan Notice requesting a Borrowing of Term B-3 Loans, the requested Borrowing shall occur during the Term B-3 Availability Period.

(f) With respect to any Loan Notice requesting a Borrowing of Term C Loans, the requested Borrowing shall occur during the Term C Availability Period.

(g) The Administrative Agent shall have received a Loan Notice in accordance with the requirements hereof.

Each Loan Notice submitted by the Borrower shall be deemed to be a representation and warranty that the conditions specified in Sections 5.03(a) through (f) have been satisfied on and as of the date of the applicable Borrowing.

5.04 Additional Conditions to Term C Borrowing.

The obligation of each Lender to honor any Loan Notice requesting a Borrowing of Term C Loans is subject to the following additional conditions precedent:

(a) Such Borrowing shall be in compliance with Section 2.14 in all respects;

(b) The Administrative Agent shall have received an executed copy of the definitive transaction agreements for the Approved Strategic Investment, together with all exhibits and schedules thereto, certified by a Responsible Officer of the Borrower as true and complete, in each case in form and substance satisfactory to the Administrative Agent; and

(c) The Administrative Agent shall have received satisfactory evidence that the Approved Strategic Investment shall have been, or will be substantially concurrently with such Borrowing, consummated in compliance with applicable Law and regulatory approvals and in accordance in all material respects with the definitive transaction agreements for the Approved Strategic Investment.

Each Loan Notice submitted by the Borrower shall be deemed to be a representation and warranty that the conditions specified in Sections 5.03(a) through (f) and 5.04(a) have been satisfied on and as of the date of the applicable Borrowing.

ARTICLE VI.

REPRESENTATIONS AND WARRANTIES

On the Funding Date, and on each date thereafter on which the representations and warranties set forth herein are required to be made under any Investment Document (or deemed to be made under any Investment Document), the Loan Parties represent and warrant to the Administrative Agent and the Lenders that:

6.01 Existence, Qualification and Power.

Each Loan Party and each Subsidiary (a) is duly incorporated, organized or formed, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to (i) own or lease its assets and carry on its business and (ii) execute, deliver and perform its obligations under the Investment Documents to which it is a party and (c) is duly qualified and is licensed and in good standing under the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license; except in each case referred to in clauses (b)(i) or (c) , to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

6.02 Authorization; No Contravention.

The execution, delivery and performance by each Loan Party of each Investment Document to which such Person is party have been duly authorized by all necessary corporate or other organizational action, and do not (a) contravene the terms of any of such Person’s Organization Documents, (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any payment to be made under (i) any Contract to which such Person is a party or affecting such Person or the properties of such Person or any of its Subsidiaries or (ii) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Person or its property is subject or (c) violate, in any material respect, any Law (including, without limitation, Regulation U or Regulation X issued by the FRB), except with respect to any conflict, breach, contravention or payment (but not creation of Liens) referred to in clause (b) to the extent that such conflict, breach, contravention or payment could not reasonably be expected to have a Material Adverse Effect.

6.03 Governmental Authorization; Other Consents.

No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against, any Loan Party of this Agreement or any other Investment Document other than (a) those that have already been obtained and are in full force and effect, (b) filings to perfect the Liens created by the Collateral Documents and (c) those approvals, consents, exemptions, authorizations, actions, notices or filings described in the Collateral Documents.

6.04 Binding Effect.

Each Investment Document has been duly executed and delivered by each Loan Party that is party thereto. Each Investment Document constitutes a legal, valid and binding obligation of each Loan Party that is party thereto, enforceable against each such Loan Party in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium and similar laws affecting the enforceability of creditors’ rights

generally and to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

6.05 Financial Statements; No Material Adverse Effect.

(a) The Audited Financial Statements (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein, (ii) fairly present in all material respects the financial condition of the Borrower and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein and (iii) show all material indebtedness and other liabilities, direct or contingent, of the Borrower and its Subsidiaries as of the date thereof, including material liabilities for taxes, commitments and Indebtedness.

(b) The Interim Financial Statements (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein, (ii) fairly present in all material respects the financial condition of the Borrower and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby, subject, in the case of clauses (i) and (ii) , to the absence of footnotes and to normal year-end audit adjustments and (iii) show all material indebtedness and other liabilities, direct or contingent, of the Borrower and its Subsidiaries as of the date thereof, including material liabilities for taxes, material commitments and Indebtedness.

(c) From the date of the Audited Financial Statements to and including the Funding Date, there has been no Disposition by any Loan Party or any Subsidiary, or any Involuntary Disposition, of any material part of the business or property of any Loan Party or any Subsidiary, and no purchase or other acquisition by any of them of any business or property (including any Equity Interests of any other Person) material to any Loan Party or any Subsidiary, in each case, which is not reflected in the foregoing financial statements or in the notes thereto and has not otherwise been disclosed in writing to the Lenders on or prior to the Funding Date.

(d) The financial statements delivered pursuant to Section 7.01(a) and (b) have been prepared in accordance with GAAP (except as may otherwise be permitted under Section 7.01(a) and (b) ) and present fairly in all material respects (on the basis disclosed in the footnotes to such financial statements) the consolidated financial condition, results of operations and cash flows of the Borrower and its Subsidiaries as of the dates thereof and for the periods covered thereby.

(e) Since the date of the Audited Financial Statements, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.

6.06 Litigation.

There are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of the Loan Parties after due and diligent investigation, threatened in writing, at law, in equity, in arbitration or before any Governmental Authority, by or against any Loan Party or any of its Subsidiaries or against any of their properties or revenues that (a) purport to affect or pertain to this Agreement or any other Investment Document, or any of the transactions contemplated hereby or (b) could reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect.

6.07 No Default.

(a) Neither any Loan Party nor any Subsidiary is in default under or with respect to any Contract that could reasonably be expected to have a Material Adverse Effect.

(b) No Default or Event of Default has occurred and is continuing.

6.08 Ownership of Property; Liens.

(a) Each Loan Party and its Subsidiaries has good record and marketable title in fee simple to, or valid leasehold interests in, all real property necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The property of each Loan Party and its Subsidiaries is subject to no Liens, other than Permitted Liens.

(b) No Loan Party nor any of their respective Subsidiaries (including, for the avoidance of doubt, any Subsidiary in which a Loan Party holds a minority interest) has any direct or indirect interest in any real property located in the British Virgin Islands.

6.09 Environmental Compliance.

Except as could not reasonably be expected to have a Material Adverse Effect:

(a) Each of the Business Facilities and all operations at the Business Facilities are in compliance with all applicable Environmental Laws, and there is no violation of any Environmental Law with respect to the Business Facilities or the Businesses, and there are no conditions relating to the Business Facilities or the Businesses that could give rise to liability under any applicable Environmental Laws.

(b) None of the Business Facilities contains, or has previously contained, any Hazardous Materials at, on or under the Business Facilities in amounts or concentrations that constitute or constituted a violation of, or could give rise to liability under, Environmental Laws.

(c) Neither any Loan Party nor any Subsidiary has received any written notice of, or inquiry from any Governmental Authority regarding, any violation, alleged violation, non-compliance, liability or potential liability regarding environmental matters or compliance with Environmental Laws with regard to any of the Business Facilities or the Businesses, nor does any Responsible Officer of any Loan Party have knowledge or reason to believe that any such notice will be received or is being threatened.

(d) Hazardous Materials have not been transported or disposed of from the Business Facilities, or generated, treated, stored or disposed of at, on or under any of the Business Facilities or any other location, in each case by or on behalf of any Loan Party or any Subsidiary in violation of, or in a manner that would be reasonably likely to give rise to liability under, any applicable Environmental Law.

(e) No judicial proceeding or governmental or administrative action is pending or, to the knowledge of the Loan Parties, threatened in writing, under any Environmental Law to which any Loan Party or any Subsidiary is or will be named as a party, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other administrative or

judicial requirements outstanding under any Environmental Law with respect to any Loan Party, any Subsidiary, the Business Facilities or the Businesses.

(f) There has been no release or threat of release of Hazardous Materials at or from the Business Facilities, or arising from or related to the operations (including, without limitation, disposal) of any Loan Party or any Subsidiary in connection with the Business Facilities or otherwise in connection with the Businesses, in violation of or in amounts or in a manner that could give rise to liability under Environmental Laws.

6.10 Insurance.

(a) The properties of the Loan Parties and their respective Subsidiaries are insured with financially sound and reputable insurance companies that are not Affiliates of the Borrower or any Subsidiary, in such amounts, with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where the applicable Loan Party or the applicable Subsidiary operates. The insurance coverage of the Loan Parties and their respective Subsidiaries as in effect on the Effective Date is outlined as to carrier, policy number, expiration date, type, amount and deductibles on Schedule 6.10 to the Disclosure Letter.

(b) The Borrower and its Subsidiaries maintain, if available, fully paid flood hazard insurance on all real property that is located in a special flood hazard area and that constitutes Collateral on such terms and in such amounts as required by The National Flood Insurance Reform Act of 1994 or as otherwise required by the Administrative Agent.

6.11 Taxes.

The Loan Parties and their respective Subsidiaries have filed all federal, provincial, territorial and state income and other material tax returns and reports required to be filed, and have paid all federal, provincial, territorial and state income and other material taxes, assessments, fees and other governmental charges levied or imposed upon them or their properties, income or assets otherwise due and payable, except those which are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been provided in accordance with GAAP. There is no proposed tax assessment against any Loan Party or any Subsidiary that would, if made, have a Material Adverse Effect. Neither any Loan Party nor any Subsidiary thereof is party to any tax sharing agreement with any Person that is not a Loan Party.

6.12 ERISA Compliance.

(a) Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the Internal Revenue Code and other federal or state laws. Any Pension Plan that is intended to be a qualified plan under Section 401(a) of the Internal Revenue Code has received a favorable determination letter from the Internal Revenue Service to the effect that the form of such Plan is qualified under Section 401(a) of the Internal Revenue Code and any trust related thereto has been determined by the Internal Revenue Service to be exempt from federal income tax under Section 501(a) of the Internal Revenue Code or an application for such a letter will be timely submitted to the Internal Revenue Service for processing. To the best knowledge of the Loan Parties, nothing has occurred that would prevent, or cause the loss of, any such tax-qualified status.

(b) There are no pending or, to the best knowledge of the Loan Parties, threatened (in writing) claims, actions or lawsuits, or action by any Governmental Authority, with respect to any

Plan that would reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect. There has been no prohibited transaction or violation of the fiduciary responsibility rules applicable with respect to any Plan that has resulted or would reasonably be expected, either individually or in the aggregate, to result in a Material Adverse Effect.

(c) (i) No ERISA Event has occurred and neither the Borrower nor any ERISA Affiliate is aware of any fact, event or circumstance that would reasonably be expected to constitute or result in an ERISA Event with respect to any Pension Plan, (ii) the Borrower and each ERISA Affiliate has met any applicable requirements under the Pension Funding Rules in respect of any Pension Plan, and no waiver of the minimum funding standards under the Pension Funding Rules has been applied for or obtained by the Borrower or any ERISA Affiliate, (iii) as of the most recent valuation date for any Pension Plan, the funding target attainment percentage (as defined in Section 430(d)(2) of the Internal Revenue Code) is sixty percent (60%) or higher and neither the Borrower nor any ERISA Affiliate knows of any facts or circumstances that could reasonably be expected to cause the funding target attainment percentage for any such plan to drop below sixty percent (60%) as of the most recent valuation date, (iv) neither the Borrower nor any ERISA Affiliate has incurred any liability to the PBGC with respect to any Pension Plan other than for the payment of any premiums, and there are no premium payments which have become due that are unpaid, (v) neither the Borrower nor any ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or Section 4212(c) of ERISA and (vi) no Pension Plan has been terminated by the plan administrator thereof nor by the PBGC, and no event or circumstance has occurred or exists that could reasonably be expected to cause the PBGC to institute proceedings under Title IV of ERISA to terminate any Pension Plan.

(d) Each Loan Party is not and will not be (i) an employee benefit plan subject to Title I of ERISA, (ii) a plan or account subject to Section 4975 of the Internal Revenue Code; (iii) an entity deemed to hold “plan assets” of any such plans or accounts for purposes of ERISA or the Internal Revenue Code or (iv) a “governmental plan” within the meaning of ERISA.

(e) Each Loan Party and each of its Subsidiaries is in compliance in all material respects with all applicable Laws and requirements with respect to any Employee Benefit Non-U.S. Plan, and have performed in all material respects all their obligations under any such Employee Benefit Non-U.S. Plan. No Employee Benefit Non-U.S. Plan Event has occurred or is reasonably expected to occur that would reasonably be expected to result in material liability to any Loan Party or any of its Subsidiaries. Any Employee Benefit Non-U.S. Plan has been maintained in material compliance with its terms and with the requirements of any and all applicable Laws, statutes, rules, regulations and orders and has been maintained, where required, in good standing with applicable regulatory authorities, except as would not reasonably be expected, either individually or in the aggregate, to result in a material liability to any Loan Party or any of its Subsidiaries. Any contributions required to be made with respect to a, Employee Benefit Non-U.S. Plan have been timely made. Neither the Borrower nor any of its Subsidiaries has incurred any material obligation in connection with the termination of, or withdrawal from, any Employee Benefit Non-U.S. Plan. The present value of the accrued benefit liabilities (whether or not vested) under any Employee Benefit Non-U.S. Plan, determined as of the end of the Borrower’s most recently ended fiscal year on the basis of reasonable actuarial assumptions, did not exceed the current value of the assets of such Employee Benefit Non-U.S. Plan allocable to such benefit liabilities.

6.13 Subsidiaries and Capitalization.

(a) Set forth on Schedule 6.13(a) to the Disclosure Letter is a complete and accurate list as of the Effective Date of each Subsidiary (including a designation of each Subsidiary that is an Excluded Subsidiary as of the Effective Date), together with (i) jurisdiction of organization, (ii) number of shares of each class of Equity Interests outstanding, (iii) number and percentage of outstanding shares of each class owned (directly or indirectly) by any Loan Party or any Subsidiary and (iv) number and effect, if exercised, of all outstanding options, warrants, rights of conversion or purchase and all other similar rights with respect thereto. The outstanding Equity Interests of each Subsidiary are validly issued, fully paid and non-assessable.

(b) Set forth on Schedule 6.13(b) to the Disclosure Letter is a true and complete table showing the authorized and issued capitalization of the Borrower as of the Effective Date on a fully diluted basis. All issued and outstanding Equity Interests of the Borrower and each of its Subsidiaries are duly authorized and validly issued, fully paid, non-assessable and such Equity Interests were issued in compliance with all applicable Laws. All issued and outstanding Equity Interests of each Subsidiary are free and clear of all Liens. As of the Effective Date, except as described on Schedule 6.13(b) to the Disclosure Letter, there are no outstanding commitments or other obligations of any Loan Party or any Subsidiary to issue, and no rights of any Person to acquire, any shares of any Equity Interests of any Loan Party or any of their respective Subsidiaries. Except as set forth on Schedule 6.13(b) to the Disclosure Letter, there are no statutory or contractual preemptive rights, rights of first refusal, anti-dilution rights or any similar rights held by equity holders or option holders of any Loan Party. There are no agreements (voting or otherwise) among any Loan Party’s equity holders with respect to any other aspect of such Loan Party’s affairs, except as set forth on Schedule 6.13(b) to the Disclosure Letter.

6.14 Margin Regulations; Investment Company Act.

(a) The Borrower is not engaged and will not engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying margin stock. Following the application of the proceeds of each Borrowing, not more than 25% of the value of the assets (of the Borrower only or of the Borrower and its Subsidiaries on a consolidated basis) subject to the provisions of Section 8.01 or Section 8.05 or subject to any restriction contained in any agreement or instrument between the Borrower and any Lender or any Affiliate of any Lender relating to Indebtedness and within the scope of Section 9.01(e) will be margin stock.

(b) None of any Loan Party or any Subsidiary is or is required to be registered as an “investment company” under the Investment Company Act of 1940.

6.15 Disclosure.

Each Loan Party has disclosed to the Administrative Agent and the Lenders all agreements, instruments and corporate or other restrictions to which it or any of its Subsidiaries is subject, and all other matters known to it, that, either individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. No report, financial statement, certificate or other information furnished (whether written or oral) by or on behalf of any Loan Party to the Administrative Agent or any Lender in connection with the transactions contemplated hereby and the negotiation of this Agreement or delivered hereunder or under any other Loan Document (in each case, when taken as a whole, as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any fact necessary to

make the statements therein, in the light of the circumstances under which they were made, not misleading; provided , that , with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based upon assumptions it believed to be reasonable at the time (it being understood that such projected financial information is not to be viewed as facts, and that actual results during the period or periods covered by such projections may differ from the projected results and such differences may be material).

6.16 Compliance with Laws.

(a) Each Loan Party and each Subsidiary is in compliance with all Laws and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in which (i) such Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or (ii) the failure to comply therewith could not reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect.

(b) (i) Any physician, other licensed healthcare professional, or any other Person who is in a position to refer patients or other business to any Loan Party or any Subsidiary (each, a “ Referral Source ”) who has a direct ownership, investment, or financial interest in any Loan Party or any Subsidiary paid fair market value for such ownership, investment or financial interest; (ii) any ownership or investment returns distributed to any Referral Source is in proportion to such Referral Source’s ownership, investment or financial interest; and (iii) no preferential treatment or more favorable terms were or are offered to such Referral Source compared to investors or owners who are not in a position to refer patients or other business. Neither any Loan Party nor any Subsidiary, directly or indirectly, has guaranteed a loan, made a payment toward a loan or otherwise subsidized a loan for any Referral Source including, without limitation, any loans related to financing the Referral Source’s ownership, investment or financial interest in such Loan Party or any such Subsidiary.

(c) Without limiting the generality of the foregoing, except where noncompliance individually or in the aggregate could not reasonably be expected, either individually or in the aggregate, to result in a Material Adverse Effect:

(i) any financial relationships between or among any Loan Party or any Subsidiary, on the one hand, and any Referral Source, on the other hand (A) comply with all applicable Healthcare Laws including, without limitation, the Federal Anti-Kickback Statute, the Stark Law and applicable state antikickback and self-referral laws; (B) reflect fair market value, have commercially reasonable terms and were negotiated at arm’s length and (C) do not obligate the Referral Source to purchase, use, recommend or arrange for the use of any products or services of any Loan Party or any Subsidiary; and

(ii) each Loan Party and each Subsidiary have implemented policies and procedures to monitor, collect and report any payments or transfers of value to certain healthcare providers and teaching hospitals in accordance with the Affordable Care Act of 2010 and its implementing regulations and any applicable state disclosure and transparency laws.

(d) Except as set forth on Schedule 6.16(d) to the Disclosure Letter, the consummation of the transactions contemplated hereby and the exercise by the Administrative Agent or the Lenders of any right or protection set forth in this Agreement will not constitute a breach or violation of, or

otherwise affect the enforceability or approval of, any (i) Device Clearance Applications, (ii) Product Authorizations or (iii) Regulatory Approvals.

6.17 Intellectual Property; Licenses, Etc.

(a) Schedule 6.17(a) to the Disclosure Letter contains, with respect to each Loan Party and each of its Subsidiaries:

(i) a complete and accurate list of all applied for, issued, or registered Patents (A) owned by, (B) constituting Material IP Rights and nonexclusively licensed to or (C) exclusively licensed to a Loan Party or one of its Subsidiaries, including the jurisdiction and patent number or patent application number;

(ii) a complete and accurate list of all material unregistered, applied for or registered Trademarks (A) owned by, (B) constituting Material IP Rights and nonexclusively licensed to or (C) exclusively licensed to a Loan Party or one of its Subsidiaries, including the jurisdiction, trademark application or registration number and the application or registration date; and

(iii) a complete and accurate list of all material applied for or registered Copyrights (A) owned by, (B) constituting Material IP Rights and nonexclusively licensed to or (C) exclusively licensed to a Loan Party or one of its Subsidiaries.

(b) Except for non-exclusive licenses granted in the ordinary course of business, each Loan Party and each of their Subsidiaries is the absolute beneficial owner of all right, title and interest in and to the Business IP Rights that it owns (including, without limitation, the Business IP Rights indicated on Schedule 6.17(b) to the Disclosure Letter as being owned by such Loan Party or Subsidiary), with good and marketable title (and no breaks in chain of title), free and clear of any Liens or claims of any kind whatsoever other than Permitted Liens and each Loan Party and Subsidiary has the right to use all its Material IP Rights. Without limiting the foregoing, and except as set forth in Schedule 6.17(b) to the Disclosure Letter:

(i) other than as permitted by Section 8.05 , no Loan Party, nor any of its Subsidiaries, has transferred ownership of or exclusively licensed any of its Material IP Rights, in whole or in part, to any Person who is not a Loan Party;

(ii) other than (A) customary restrictions in in-bound licenses or out-bound non-exclusive licenses of IP Rights and non-disclosure agreements, (B) as would have been or is permitted by Sections 8.01 and 8.05 or (C) non-exclusive licenses granted in the ordinary course of business, there are no covenants not to sue, permits, grants, licenses or other agreements or arrangements relating to such Loan Party’s or any of their respective Subsidiary’s Material IP Rights, including any development, submission, services, research, license or support agreements, which bind, obligate or otherwise restrict such Loan Party or any of its Subsidiaries with respect to any Material IP Rights;

(iii) (A) there are no pending or, to the knowledge of any Loan Party, threatened (in writing) claims against any Loan Party or any of its Subsidiaries asserted by any other Person relating to any Business IP Rights, including any claims of adverse ownership, invalidity, infringement, misappropriation, violation or other opposition to or conflict with such Business IP Rights that could reasonably be expected, either individually or in the

aggregate, to have a Material Adverse Effect and (B) except as could not reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect, there are no pending or, to the knowledge of any Loan Party, threatened (in writing) claims against any Loan Party or any of their respective Subsidiaries and no Loan Party or any of their respective Subsidiaries have received any written notice from any Person that any Loan Party’s or any Subsidiary’s business and/or the use of any Business IP Rights or any Product, Product Commercialization and Development Activities or Product Assets infringes upon, violates or constitutes a misappropriation of, or may infringe upon, violate or constitute a misappropriation of, or otherwise interfere with any IP Rights of any other Person or otherwise offering a license with respect to any Product;

(iv) the Loan Parties have no knowledge that any Business IP Right is being infringed, violated, misappropriated or otherwise used by any other Person without the express authorization of the Loan Parties and, without limiting the foregoing, no Loan Party nor any Subsidiary has put any other Person on notice of actual or potential infringement, violation or misappropriation of any Business IP Rights and no Loan Party nor any Subsidiary has initiated the enforcement of any claim with respect to any Business IP Rights;

(v) all relevant current and former employees and contractors of each Loan Party and each Subsidiary who were or are involved in the creation or development of Business IP Rights have executed written confidentiality and invention assignment contracts with such Loan Party or such Subsidiary substantially in the form provided to the Administrative Agent’s counsel;

(vi) the operation of each Loan Party’s and each Subsidiary’s business and/or the use by each Loan Party and each of their Subsidiaries of any of their respective Business IP Rights, Products, Product Commercialization and Development Activities or Product Assets does not breach, violate, infringe or interfere with or constitute a misappropriation of any valid rights arising under any IP Rights of any other Person that could reasonably be expected, either individually or in the aggregate, to result in a Material Adverse Effect.

(c) The Business IP Rights are subsisting, valid, unexpired, enforceable and have not been abandoned. With respect to the owned Business IP Rights consisting of Patents, except as set forth in Schedule 6.17(b) to the Disclosure Letter and without limiting the representations and warranties in clause (b) :

(i) none of the Patents or the Inventions claimed in any such Patent have been dedicated to the public except as a result of intentional decisions made by the applicable Loan Party or Subsidiary and no Loan Party, Subsidiary nor any of their respective predecessors-in-interest has filed any disclaimer (other than a terminal disclaimer) or filed any other voluntary reduction in the scope of the Inventions claimed in such Patents;

(ii) no Loan Party, Subsidiary, nor, to the knowledge of the Loan Parties, any prior owner of any Patent or any of their respective agents or representatives have engaged in any conduct, or omitted to perform any necessary act, the result of which would invalidate or render unpatentable or unenforceable any Patent, except as could not reasonably be expected, either individually or in the aggregate, to result in a Material Adverse Effect;

(iii) all maintenance fees, annuities, and the like due or payable on or with respect to any Patents have been timely paid, except as could not reasonably be expected, either individually or in the aggregate, to result in a Material Adverse Effect;

(iv) no Patents are or have been the subject of any re-examination, opposition, any other pre- or post-grant proceedings or of any administrative, arbitration, judicial or other proceeding, nor is any Loan Party aware of any basis for any such interference, re-examination, opposition, inter partes review, post grant review or any other pre- or post-grant proceedings, judicial proceeding or other proceeding;

(v) no Loan Party or Subsidiary has received any written notice asserting that any Patents are invalid, unpatentable or unenforceable; and

(vi) if any Patent is terminally disclaimed to another patent or patent application, all patents and patent applications subject to such terminal disclaimer are included in the Collateral.

(d) Schedule 6.17(d) to the Disclosure Letter sets forth an accurate list of all Material IP Rights, together with an indication as to whether the applicable Loan Party or applicable Subsidiary owns or has an exclusive or nonexclusive license to such Material IP Rights.

(e) None of the IP Rights are subject to any license grant by any Loan Party or any Subsidiary or similar arrangement, except for (i) license grants solely between the Loan Parties, (ii) those license grants disclosed on Schedule 6.17(e) to the Disclosure Letter and (iii) non-exclusive licenses permitted by Section 8.05 granted in the ordinary course of business.

6.18 Solvency.

The Borrower and its Subsidiaries are Solvent, on a consolidated basis.

6.19 Perfection of Security Interests in the Collateral.

The Collateral Documents create valid security interests in, and Liens on, the Collateral purported to be covered thereby, which security interests and Liens will be, upon the timely and proper filings, deliveries and other actions contemplated in the Collateral Documents perfected security interests and Liens (to the extent that such security interests and Liens can be perfected by such filings, deliveries, notations and other actions), prior to all other Liens other than Permitted Liens.

6.20 Business Locations.

Set forth on Schedule 6.20(a) to the Disclosure Letter is a list of all real property that is owned or leased by the Loan Parties as of the Effective Date (with (x) a designation of each real property that is Excluded Property and (y) a designation as to whether such real property is owned or leased). Set forth on Schedule 6.20(b) to the Disclosure Letter is the tax payer identification number (or foreign equivalent) and organizational identification number (or foreign equivalent) of each Loan Party as of the Effective Date. The exact legal name and state of organization (or foreign equivalent) of (a) the Borrower is as set forth on the signature pages hereto and (b) each Guarantor is (i) as set forth on the signature pages hereto, (ii) as set forth on the signature pages to the Joinder Agreement pursuant to which such Guarantor became a party hereto or (iii) as may be otherwise disclosed by the Loan Parties to the Administrative Agent in accordance with Section 8.12(c) . Set forth on Schedule 6.20(c) to the Disclosure Letter are the locations of all inventory,

equipment and other tangible personal property of each BVI Loan Party, as of the Effective Date. Set forth on Schedule 6.20(d) to the Disclosure Letter are the locations of all inventory, equipment and other tangible personal property of (x) each Belgian Loan Party and (y) each Loan Party located in the Kingdom of Belgium, in each case, as of the Effective Date. Set forth on Schedule 6.20(e) to the Disclosure Letter are the locations of all inventory, equipment and other tangible personal property of (x) each Costa Rican Loan Party and (y) each Loan Party located in the Republic of Costa Rica, in each case, as of the Effective Date. Set forth on Schedule 6.20(f) to the Disclosure Letter are the locations of all inventory, equipment and other tangible personal property of (x) each Brazilian Loan Party and (y) each Loan Party located in the Federative Republic of Brazil, in each case, as of the Effective Date. Except as set forth on Schedule 6.20(g) to the Disclosure Letter, no Loan Party has during the five years preceding the Effective Date (x) changed its legal name, (y) changed its state of organization (or foreign equivalent) or (z) been party to a continuation, merger, amalgamation, consolidation or other change in structure.

6.21 Sanctions Concerns; Anti-Corruption Laws; PATRIOT Act; Anti-Money Laundering Laws.

(a) Sanctions Concerns . No Loan Party, nor any Subsidiary, nor, to the knowledge of the Loan Parties and their respective Subsidiaries, any director, officer, employee, agent, affiliate or representative thereof, is an individual or entity that is, or is owned or controlled by, any individual or entity that is (i) the subject or target of any Sanctions, (ii) included on OFAC’s List of Specially Designated Nationals, HMT’s Consolidated List of Financial Sanctions Targets and the Investment Ban List, or any similar list enforced by any other relevant sanctions authority or (iii) located, organized or resident in a Designated Jurisdiction.

(b) Anti-Corruption Laws . The Loan Parties and their respective Subsidiaries have conducted their business in material compliance with the United States Foreign Corrupt Practices Act of 1977, the UK Bribery Act 2010 and other similar anti-corruption legislation in other jurisdictions applicable to any Loan Party or any Subsidiary, and have instituted and maintained policies and procedures designed to promote and achieve compliance with such laws.

(c) PATRIOT Act . To the extent applicable, each Loan Party and each Subsidiary is in compliance, in all material respects, with (i) the Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating thereto and (ii) the Act.

(d) Anti-Money Laundering Laws . No Loan Party, nor any Subsidiary, nor, to the knowledge of the Loan Parties and their respective Subsidiaries, any director, officer, employee, agent, affiliate or representative thereof, (i) has been found in violation of, charged with, or convicted of, money laundering, drug trafficking, terrorist related activities or other money laundering predicate crimes under the Currency and Foreign Transactions Reporting Act of 1970 (otherwise known as the Bank Secrecy Act), the Act or any other United States law or regulation governing such activities (collectively, “ Anti-Money Laundering Laws ”) or any U.S. economic sanctions violations, (ii) to each Loan Party’s actual knowledge after making due inquiry, is under investigation by any Governmental Authority for possible violation of Anti-Money Laundering Laws or any Sanctions violations, (iii) has been assessed civil penalties under any Anti-Money Laundering Laws or any Sanctions or (iv) has had any of its funds seized or forfeited in an action under any Anti-Money Laundering Law. Each Loan Party has established procedures and controls which it reasonably believes are adequate (and otherwise comply in all material respects with applicable Law) to ensure

that each Loan Party and each Subsidiary thereof is and will continue to be in compliance in all material respects with all applicable current and future Anti-Money Laundering Laws.

6.22 Material Contracts.

Except for Organization Documents of the Loan Parties and their respective Subsidiaries, there are no Material Contracts other than as set forth on Schedule 6.22 to the Disclosure Letter as of the Effective Date. Schedule 6.22 to the Disclosure Letter sets forth, with respect to each real estate lease agreement to which any Loan Party or any Subsidiary is a party as of the Effective Date that constitutes a Material Contract, the address of the subject property and the annual rental rate as of the Effective Date. The consummation of the transactions contemplated by the Investment Documents and the exercise by the Administrative Agent or the Lenders of any right or protection set forth in the Investment Documents will not constitute a breach or violation of, or otherwise affect the enforceability of, or give rise to a right of termination in favor of any party to any Material Contract. Except as otherwise disclosed on Schedule 6.22 to the Disclosure Letter (or pursuant to Section 7.02(a) ), all Material Contracts are in full force and effect without material modification from the form in which the same were disclosed to the Administrative Agent. Except as set forth on Schedule 6.22 to the Disclosure Letter, there are no Material Contracts which are non-assignable by their terms, or as a matter of law, or which prevent the granting of a security interest therein.

6.23 Regulatory Approvals.

(a) With respect to the Products, the Loan Parties hold either directly or through licensees and agents, all Regulatory Approvals necessary or required for such Loan Party and each of its Subsidiaries to conduct all current Product Commercialization and Development Activities with respect to the Products.

(b) Set forth on Schedule 6.23(b) to the Disclosure Letter is a complete and accurate list of all Regulatory Approvals referred to in clause (a) , setting forth (in reasonable detail and on a Product-by-Product basis) the Loan Party that holds such Regulatory Approval and identifying the product related to such Regulatory Approval. All such Regulatory Approvals are (i) legally and beneficially owned exclusively by such Loan Party identified on such Schedule, free and clear of all Liens other than Permitted Liens, (ii) validly registered and on file with the applicable Regulatory Authority in compliance in all material respects with all registration, filing and maintenance requirements (including any fee requirements) thereof and (iii) valid, enforceable, in good standing and in full force and effect, with the applicable Regulatory Authority.

(c) All regulatory filings required by any Regulatory Authority or in respect of any Regulatory Approval or Product Authorization with respect to any Product or any Product Commercialization and Development Activities have been made (including all required notices, registrations and listings, supplemental applications or notifications, reports (including field alerts, Device reports or other reports of adverse experiences) and all other required filings with respect to the Products or any related Product Commercialization and Development Activities), and all such filings are complete and correct in all material respects and are in compliance in all material respects with all applicable Laws.

(d) Each Loan Party and each Subsidiary and to the knowledge of the Loan Parties, each of their licensees and agents is in compliance in all material respects with all applicable Laws (including all Regulatory Approvals and Product Authorizations) with respect to each Product as to which such Person conducts, directly or indirectly, any Product Commercialization and Development Activities.

(e) Except as set forth on Schedule 6.23(e) to the Disclosure Letter, and without limiting the generality of any other representation or warranty made by any Loan Party hereunder or under any other Loan Document: (i) all Products comply in all material respects with (A) all applicable Laws of the FDA and each other applicable Regulatory Authority, whether U.S. or non-U.S. and (B) all Product Authorizations and other Regulatory Authorizations; (ii) no Loan Party nor any of their respective Subsidiaries nor, to the knowledge of any Loan Party, any of their respective agents, suppliers, licensors or licensees have received any inspection reports, warning letters or notices or similar documents with respect to any Product from any Regulatory Authority within the last three (3) years that asserts lack of compliance with any applicable Law or Regulatory Approvals or other orders, injunctions or decrees; (iii) no Loan Party nor any of their respective Subsidiaries nor, to the knowledge of any Loan Party, any of their respective agents, suppliers, licensors or licensees have received any notification from any Regulatory Authority within the last three (3) years, asserting that any Product lacks a required Regulatory Approval or Product Authorization; (iv) there is no pending regulatory action, investigation or inquiry (other than non-material routine or periodic inspections or reviews) against any Loan Party, any of their respective Subsidiaries or, to the knowledge of any Loan Party, any of their respective suppliers, licensors or licensees with respect to any Product and, to the knowledge of any Loan Party, there is no reasonable basis for any adverse regulatory action against such Loan Party or any of their respective Subsidiaries or, to the knowledge of any Loan Party, any of their respective suppliers, agents, licensors or licensees with respect to any Product and (v) without limiting the foregoing, (A) (1) there have been no product recalls, safety alerts, corrections, withdrawals, marketing suspensions or removals conducted, undertaken or issued by any Loan Party or any Subsidiary, whether voluntary, at the request, demand or order of any Regulatory Authority or otherwise, with respect to any Product within the last three (3) years, (2) no such product recall, safety alert, correction, withdrawal, marketing suspension or removal has been requested, demanded or ordered by any Regulatory Authority within the last three (3) years, and, to the knowledge of any Loan Party, there is no reasonable basis for the issuance of any such product recall, safety alert, correction, withdrawal, marketing suspension or removal with respect to any Product and (B) no criminal, injunctive, seizure, detention or civil penalty action has been commenced or threatened in writing by any Regulatory Authority within the last three (3) years with respect to or in connection with any Product, there are no consent decrees (including plea agreements) that relate to any Product and, to the knowledge of each Loan Party, there is no reasonable basis for the commencement of any criminal injunctive, seizure, detention or civil penalty action by any Regulatory Authority relating to any Product or for the issuance of any consent decree. To the knowledge of each Loan Party, no Loan Party nor any of their respective Subsidiaries nor any of their respective agents, suppliers, licensees or licensors is employing or utilizing the services of any individual who has been debarred or temporarily suspended under any applicable Law.

(f) Neither any Loan Party nor any of their respective Subsidiaries, nor, to the knowledge of the Loan Parties, any of their respective officers, employees or agents, has made an untrue statement of a material fact or fraudulent statements to the FDA or any other Regulatory Authority, failed to disclose a material fact required to be disclosed to the FDA or any other Regulatory Authority or committed an act, made a statement or failed to make a statement that, at the time such disclosure was made (or was not made), could reasonably be expected to provide a basis for the FDA or any other Regulatory Authority to invoke its policy respecting Fraud, Untrue Statements of Material Facts, Bribery and Illegal Gratuities, set forth in 56 Fed. Reg. 46191 (September 10, 1991) or any similar policy.

(g) The clinical, preclinical, safety and other studies and tests conducted by or on behalf of or sponsored by any Loan Party or any of their respective Subsidiaries, or in respect of which any

Products or Product candidates under development have participated, were (and if still pending, are) being conducted materially in accordance with standard medical and scientific research procedures and all applicable Product Authorizations. No Loan Party nor any of their respective Subsidiaries has received any notices or other correspondence from the FDA or any other Regulatory Authority requiring the termination or suspension of any clinical, preclinical, safety or other studies or tests used to support regulatory clearance of, or any Product Authorization or Regulatory Approval for, any Product.

6.24 Labor Matters.

There are no existing or threatened (in writing) strikes, lockouts or other labor disputes involving any Loan Party or any Subsidiary that individually or in the aggregate could reasonably be expected to have a Material Adverse Effect. Hours worked by and payment made to employees of the Loan Parties and their respective Subsidiaries are not in violation of the Fair Labor Standards Act or any other applicable law, rule or regulation dealing with such matters, except for any such violations as could not reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect.

6.25 EEA Financial Institutions.

No Loan Party is an EEA Financial Institution.

6.26 Representations as to Foreign Loan Parties.

Each Foreign Loan Party represents and warrants to the Administrative Agent and the Lenders that:

(a) Such Foreign Loan Party is subject to civil and commercial Laws with respect to its obligations under this Agreement and the other Investment Documents to which it is a party (collectively as to such Foreign Loan Party, the “ Applicable Foreign Loan Party Documents ” (it being understood and agreed that the guarantees and security interests provided and granted by any Belgian Loan Party are limited to those provided and granted in this Agreement, the Belgian Share Pledge Agreement and the Belgian Receivables Pledge Agreement)), and the execution, delivery and performance by such Foreign Loan Party of the Applicable Foreign Loan Party Documents constitute and will constitute private and commercial acts and not public or governmental acts. Neither such Foreign Loan Party nor any of its property has any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) under the laws of the jurisdiction in which such Foreign Loan Party is organized and existing in respect of its obligations under the Applicable Foreign Loan Party Documents.

(b) The Applicable Foreign Loan Party Documents are in proper legal form under the Laws of the jurisdiction in which such Foreign Loan Party is organized and existing for the enforcement thereof against such Foreign Loan Party under the Laws of such jurisdiction, and to ensure the legality, validity, enforceability, priority or admissibility in evidence of the Applicable Foreign Loan Party Documents. It is not necessary to ensure the legality, validity, enforceability, priority or admissibility in evidence of the Applicable Foreign Loan Party Documents that the Applicable Foreign Loan Party Documents be filed, registered or recorded with, or executed or notarized before, any court or other authority in the jurisdiction in which such Foreign Loan Party is organized and existing or that any registration charge or stamp or similar tax be paid on or in respect of the Applicable Foreign Loan Party Documents or any other document, except for (i) any such filing, registration, recording, execution or notarization as has been made or is not required to

be made until the Applicable Foreign Loan Party Document or any other document is sought to be enforced and (ii) any charge or tax as has been timely paid.

(c) With respect to any Foreign Loan Party that becomes a party to this Agreement after the Effective Date as contemplated by Section 7.12 , there is no tax, levy, impost, duty, fee, assessment or other governmental charge, or any deduction or withholding, imposed by any Governmental Authority in or of the jurisdiction in which such Foreign Loan Party is organized and existing either (i) on or by virtue of the execution or delivery of the Applicable Foreign Loan Party Documents or (ii) on any payment to be made by such Foreign Loan Party pursuant to the Applicable Foreign Loan Party Documents, except as has been disclosed to the Administrative Agent.

(d) The execution, delivery and performance of the Applicable Foreign Loan Party Documents executed by such Foreign Loan Party are, under applicable foreign exchange control regulations of the jurisdiction in which such Foreign Loan Party is organized and existing, not subject to any notification or authorization except (i) such as have been made or obtained or (ii) such as cannot be made or obtained until a later date ( provided that any notification or authorization described in clause (ii) shall be made or obtained as soon as is reasonably practicable).

6.27 Royalty and Other Payments.

Except as set forth on Schedule 6.27 to the Disclosure Letter, as of the Effective Date, no Loan Party nor any of their respective Subsidiaries is obligated to pay any royalty, milestone payment, deferred payment or any other contingent payment in respect of any Product.

6.28 Non-Competes.

Neither the Borrower nor any other Loan Party nor any of their respective Subsidiaries, nor, to the knowledge of any Loan Party, any of their respective directors, officers or employees, is subject to a non-compete agreement that prohibits or will interfere with any of the Product Commercialization and Development Activities, including the development, commercialization or marketing of any Product.

6.29 Internal Controls.

The Borrower acknowledges that its management is responsible for the preparation and fair presentation of the financial statements of the Borrower and each of its Subsidiaries provided to the Administrative Agent or the Lenders pursuant to Sections 7.01 and 7.02 , in each case, in accordance with GAAP. The Borrower has designed, implemented and maintained internal controls relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

ARTICLE VII.

AFFIRMATIVE COVENANTS

On the Funding Date and thereafter, so long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied (other than contingent indemnification obligations for which no claim has been asserted), the Loan Parties shall and shall cause each Subsidiary to:

7.01 Financial Statements.

Deliver to the Administrative Agent, in form and detail reasonably satisfactory to the Administrative Agent and the Required Lenders:

(a) (i) as soon as available, and in any event within one hundred and twenty (120) days after the end of each fiscal year of the Borrower (or, if earlier, when required to be filed with the SEC (or foreign equivalent)), a consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal year, and the related consolidated statements of income or operations, changes in shareholders’ equity and cash flows for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail and prepared in accordance with GAAP, audited and accompanied by a report and opinion of an independent certified public accountant of nationally recognized standing acceptable to the Required Lenders, which report and opinion shall be prepared in accordance with generally accepted auditing standards and shall not be subject to any “going concern” or like qualification or exception or any qualification or exception as to the scope of such audit; and (ii) as soon as available, and in any event within ninety (90) days after the end of each fiscal year of the Borrower (or, if earlier, when required to be filed with the SEC (or foreign equivalent)), a consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal year, and the related consolidated statements of income or operations, changes in shareholders’ equity and cash flows for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail and certified by a Responsible Officer of the Borrower as fairly presenting in all material respects the financial condition, results of operations, shareholders’ equity and cash flows of the Borrower and its Subsidiaries in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes; and

(b) as soon as available, and in any event within sixty (60) days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower (or, if earlier, when required to be filed with the SEC (or foreign equivalent)), a consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal quarter, and the related consolidated statements of income or operations and cash flows for such fiscal quarter and for the portion of the Borrower’s fiscal year then ended, setting forth in each case in comparative form the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the previous fiscal year, all in reasonable detail and certified by a Responsible Officer of the Borrower as fairly presenting in all material respects the financial condition, results of operations and cash flows of the Borrower and its Subsidiaries in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes.

7.02 Certificates; Other Information.

Deliver to the Administrative Agent, in form and detail reasonably satisfactory to the Administrative Agent and the Required Lenders:

(a) concurrently with the delivery of the financial statements referred to in Sections 7.01(a) and (b) , (i) a duly completed Compliance Certificate signed by a director, the chief executive officer, chief financial officer, treasurer or controller which is a Responsible Officer of the Borrower, including (A) information regarding the amount and timing of all Dispositions, Involuntary Dispositions, Debt Issuances, Extraordinary Receipts and Acquisitions that occurred during the period covered by such Compliance Certificate, (B) a certification as to whether the Loan Parties and their respective Subsidiaries have performed and observed each covenant and condition of the Loan Documents applicable to it during the period covered by the Compliance Certificate (or, if not, a listing of the conditions or covenants that have not been performed or observed and the nature and status of each such Default), (C) a certification of compliance with the financial covenants set forth in Sections 8.16 and 8.17 , including financial covenant analyses and calculation for the period covered by the Compliance Certificate, (D) a listing of (I) all applications by any Loan Party, if any, for Copyrights, Patents or Trademarks made since the date of the prior certificate (or, in the case of the first such certificate, the Effective Date), (II) all issuances of registrations or letters on existing applications by any Loan Party or any of their Subsidiaries for Copyrights, Patents and Trademarks received since the date of the prior certificate (or, in the case of the first such certificate, the Effective Date), (III) all licenses of any IP Rights (other than non-exclusive licenses permitted by Section 8.05 granted in the ordinary course of business) entered into by any Loan Party or any of their Subsidiaries since the date of the prior certificate (or, in the case of the first such certificate, the Effective Date) and (IV) such supplements to Schedules 6.17(a) , 6.17(b) , 6.17(d) , 6.17(e) and 6.22 , in each case, to the Disclosure Letter as are necessary to cause such schedules to be true and complete as of the date of such certificate, (E) the insurance binder or other evidence of insurance for any insurance coverage of any Loan Party or any Subsidiary that was renewed, replaced or modified during the period covered by such financial statements, (F) information regarding the deposit accounts and other bank accounts and securities accounts of the Loan Parties and their Subsidiaries as of the end of the period covered by such Compliance Certificate and (G) information regarding all Investments made by the Loan Parties and their Subsidiaries pursuant to Sections 8.02(c)(ii) as of the end of the period covered by such Compliance Certificate, (ii) a copy of management’s discussion and analysis with respect to such financial statements, (iii) a list of all litigations, arbitrations or governmental investigations or proceedings which were instituted during the period covered by such financial statements or which, to the knowledge of any Loan Party, are threatened (in writing) against any Loan Party or any Subsidiary which, in any case, could reasonably be expected to result in losses and/or expenses (other than, for the avoidance of doubt, legal and court fees, costs and expenses) in excess of the Threshold Amount, together with a description setting forth the details thereof and stating what action the applicable Loan Party or Subsidiary has taken and proposes to take with respect thereto and (iv) information regarding, in each case, to the extent occurring during the period covered by such financial statements, (A) the termination of any Material Contract, (B) the receipt by any Loan Party or any of its Subsidiaries of any notice under any Material Contract (and a copy thereof) as to the occurrence of any material breach or default under or pursuant to such Material Contract that could result in termination thereof or a material liability in respect thereof, (C) the entering into of any new Material Contract by a Loan Party or any of its Subsidiaries (and a copy thereof) or (D) any material amendment to a Material Contract (and a copy thereof);

(b) as soon as available, and in any event within forty-five (45) days after the end of each fiscal year of the Borrower, (i) the annual budget (or equivalent) and forecast (or equivalent) of the Borrower and its Subsidiaries, on a consolidated basis, approved by the Board of Directors of the Borrower for the then current fiscal year and forecast period as then prepared by the Borrower, in each case together with such supporting materials as are required by the Administrative Agent and in form reasonably satisfactory to the Administrative Agent, comprising the balance sheets, statements of income or operations and statements of cash flows of the Borrower and its Subsidiaries on a quarterly basis for the then current fiscal year and on an annual basis for the forecast period and (ii) a certificate of the chief financial officer of the Borrower certifying that (A) such budget and forecast were prepared by the Borrower in good faith, (B) the Borrower had at the time of preparation of the budget and forecast, and at all times thereafter (including on and as of the date of delivery to the Administrative Agent of such budget and forecast) has continued to have, a reasonable basis for all of the assumptions contained in such budget and forecast and (C) such budget and forecast were prepared in accordance with, and based upon, such assumptions;

(c) promptly after the same are available, (i) copies of each annual report, proxy or financial statement or other report or communication sent to the equityholders of any Loan Party, (ii) copies of all annual, regular, periodic and special reports and registration statements which a Loan Party may file or be required to file with the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934, and not otherwise required to be delivered to the Administrative Agent pursuant hereto and (iii) copies of each Form S-1 Registration Statement filed with the SEC (together with all exhibits and amendments thereto) and all related material correspondence with the SEC;

(d) as soon as available, copies of any detailed audit reports or management letters or recommendations submitted to the Board of Directors (or the audit committee of the Board of Directors) of the Borrower or any Subsidiary by independent accountants in connection with the accounts or books of the Borrower or any Subsidiary, or any audit of any of them;

(e) as soon as available, and in any event within seven (7) Business Days of delivery to the Board of Directors of the Borrower (or any committee of such Board of Directors), copies of all statements, reports and notices (including board kits) made available to the Borrower’s Board of Directors or the holders of the Borrower’s Equity Interests; provided , that , any such material may be redacted by the Borrower to exclude information relating to the Administrative Agent or the Lenders (including the Borrower’s strategy regarding the Loans) or material that is subject to attorney-client privilege or contractual confidentiality obligations with third parties;

(f) promptly after the furnishing thereof, copies of any statement or report furnished to any holder of debt securities of any Loan Party or any Subsidiary thereof pursuant to the terms of any indenture, loan or credit or similar agreement and not otherwise required to be furnished to the Lenders pursuant to Section 7.01 or any other clause of this Section 7.02 ;

(g) promptly, and in any event within five (5) Business Days after receipt thereof by any Loan Party or any Subsidiary thereof, (i) copies of each notice or other correspondence received from the SEC (or comparable agency in any applicable non-U.S. jurisdiction) concerning any investigation or possible investigation or other inquiry by such agency regarding financial or other operational results of any Loan Party or any Subsidiary thereof and (ii) copies of any material written correspondence or any other material written communication from the FDA or any other regulatory body;

(h) as soon as practicable, and in any event not later than the last Business Day of each month, copies of the most recent monthly statements for each deposit account and other bank account or securities account of each Loan Party;

(i) promptly after the same are released, copies of all press releases; and

(j) promptly, such additional information regarding the business, financial or corporate affairs of any Loan Party or any Subsidiary, or compliance with the terms of the Investment Documents, as the Administrative Agent or any Lender may from time to time request.

Documents required to be delivered pursuant to Section 7.01 or Section 7.02 may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) on which the Borrower posts such documents, or provides a link thereto on the Borrower’s website on the Internet at the website address listed on Schedule 11.02 or (ii) on which such documents are posted on the Borrower’s behalf on an Internet or intranet website, if any, to which each Lender and the Administrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent); provided , that : (x) the Borrower shall deliver paper copies of such documents to the Administrative Agent or any Lender upon its request to the Borrower to deliver such paper copies until a written request to cease delivering paper copies is given by the Administrative Agent or such Lender and (y) the Borrower shall notify the Administrative Agent and each Lender (by facsimile or electronic mail) of the posting of any such documents and provide to the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such documents. The Administrative Agent shall have no obligation to request the delivery of or to maintain paper copies of the documents referred to above, and in any event shall have no responsibility to monitor compliance by the Borrower with any such request for delivery by a Lender, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.

The Borrower hereby acknowledges that certain of the Lenders (each, a “ Public Lender ”) may have personnel who do not wish to receive material non-public information with respect to the Borrower or its Affiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such Persons’ securities. The Borrower hereby agrees that (1) it will in good faith identify that portion of the materials and/or information provided by, or to be provided by, or on behalf of the Borrower hereunder that does not constitute material non-public information with respect to the Borrower or its Affiliates or their respective securities (the “ Public Materials ”) and (2) it will clearly and conspicuously mark all Public Materials “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof (it being understood that by marking Public Materials “PUBLIC,” the Loan Parties shall be deemed to have authorized the Administrative Agent, any Affiliate thereof and the Lenders to treat such Public Materials as not containing any material non-public information (although it may be sensitive and proprietary) with respect to the Borrower or its securities for purposes of United States federal and state securities laws (or any foreign equivalent) ( provided , however , that , to the extent such Public Materials constitute Information, they shall be treated as set forth in Section 11.07 )).

7.03 Notices.

(a) Promptly (and in any event, within two (2) Business Days) notify the Administrative Agent and each Lender of the occurrence of any Default.

(b) Promptly (and in any event, within five (5) Business Days) notify the Administrative Agent and each Lender of any matter that has resulted or could reasonably be expected to result in a Material Adverse Effect.

(c) Promptly (and in any event, within five (5) Business Days) notify the Administrative Agent and each Lender of the occurrence of any ERISA Event.

(d) Promptly (and in any event, within five (5) Business Days) notify the Administrative Agent and each Lender of any material change in accounting policies or financial reporting practices by the Borrower or any Subsidiary.

(e) Promptly (and in any event, within two (2) Business Days) notify the Administrative Agent and each Lender of the occurrence of any default or event of default under any Permitted Senior Revolving Credit Document.

(f) Promptly (and in any event, within five (5) Business Days) notify the Administrative Agent and each Lender of any litigation, arbitration or governmental investigation or proceeding not previously disclosed by the Loan Parties which has been instituted or, to the knowledge of any Loan Party, is threatened (in writing) against any Loan Party or any Subsidiary or to which any of the properties of any thereof is subject which could reasonably be expected to result in losses and/or expenses in excess of the Threshold Amount.

(g) Promptly (and in any event, within five (5) Business Days) notify the Administrative Agent and each Lender of any material licensing agreement or similar arrangement entered into by any Loan Party or any of its Subsidiaries following such Loan Party or such Subsidiary receiving a written claim from the party to such license agreement alleging infringement of the IP Rights of another Person.

Each notice pursuant to clauses (a) through (g) of this Section 7.03 shall be accompanied by a statement of a Responsible Officer of the Borrower setting forth details of the occurrence referred to therein and stating what action the applicable Loan Party has taken and proposes to take with respect thereto. Each notice pursuant to Section 7.03(a) shall describe with particularity any and all provisions of this Agreement and any other Investment Document that have been breached.

7.04 Payment of Obligations.

Pay and discharge, as the same shall become due and payable, all its obligations and liabilities, including (a) all income and other material tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by the Loan Party or such Subsidiary, (b) all lawful claims which, if unpaid, would by law become a Lien upon its property (other than Permitted Liens) and (c) all Indebtedness, as and when due and payable, but subject to any subordination provisions contained in any instrument or agreement evidencing such Indebtedness.

7.05 Preservation of Existence, Etc.

(a) Preserve, renew and maintain in full force and effect its legal existence under the Laws of the jurisdiction of its organization except in a transaction permitted by Section 8.04 or Section 8.05 .

(b) Preserve, renew and maintain in full force and effect its good standing under the Laws of the jurisdiction of its organization, except to the extent the failure to do so could not reasonably be expected to have a Material Adverse Effect.

(c) Take all commercially reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary or desirable in the normal conduct of its business, except to the extent that the failure to do so could not reasonably be expected to have a Material Adverse Effect.

7.06 Maintenance of Properties.

(a) Maintain, preserve and protect all of its material properties and equipment necessary in the operation of its business in good working order and condition, ordinary wear and tear excepted.

(b) Make all necessary repairs thereto and renewals and replacements thereof, except where the failure to do so could not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

7.07 Maintenance of Insurance.

(a) Maintain with financially sound and reputable insurance companies that are not Affiliates of any Loan Party or any Subsidiary insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or similar business, of such types and in such amounts as are customarily carried under similar circumstances by such other Persons.

(b) Without limiting the foregoing, (i) maintain, if available, fully paid flood hazard insurance on all real property that is located in a special flood hazard area and that constitutes Collateral, on such terms and in such amounts as required by The National Flood Insurance Reform Act of 1994 or as otherwise required by the Administrative Agent, (ii) furnish to the Administrative Agent evidence of the renewal (and payment of renewal premiums therefor) of all such policies prior to the expiration or lapse thereof and (iii) furnish to the Administrative Agent prompt written notice of any redesignation of any such improved real property into or out of a special flood hazard area.

(c) Cause the Administrative Agent and its successors and/or assigns to be named as lender’s loss payee or mortgagee as its interest may appear, and/or additional insured with respect to any such insurance providing liability coverage or coverage in respect of any Collateral, and cause each provider or broker of any such insurance to agree, by endorsement upon the policy or policies issued by it or by independent instruments furnished to the Administrative Agent, that it will give the Administrative Agent fourteen (14) days (or such lesser amount as the Administrative Agent may agree) prior written notice before any such policy or policies shall be altered or canceled.

7.08 Compliance with Laws.

Comply with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its business or property, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or (b) the failure to comply therewith could not reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect.

7.09 Books and Records.

(a) Maintain proper books of record and account in a manner to allow financial statements to be prepared in accordance with GAAP consistently applied in respect of all material financial transactions and matters involving the assets and business of such Loan Party or Subsidiary, as the case may be.

(b) Maintain such books of record and account in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over such Loan Party or such Subsidiary, as the case may be.

7.10 Inspection Rights.

(a) Permit representatives and independent contractors of the Administrative Agent and each Lender, all at the expense of the Loan Parties: (i) to meet on a regular or other basis with any and all officers and employees of the Loan Parties and their respective Subsidiaries from time to time and upon reasonable advance notice to the applicable Loan Party or the applicable Subsidiary and during normal business hours for the purpose of consulting with, rendering advice, recommendations and assistance to, and influencing the management of the Loan Parties or their respective Subsidiaries or obtaining information regarding the Loan Parties’ or any of their respective Subsidiaries’ operations, activities and prospects and expressing its views thereon and (ii) to access the premises and inspect the books, records and properties of the Loan Parties and their respective Subsidiaries upon reasonable advance notice to the Loan Parties and during normal business hours; provided , that , excluding any such visits and inspections during the continuation of an Event of Default, only one such visit and inspection per year shall be at the Loan Parties’ expense (and only the Administrative Agent may exercise rights under this Section 7.10(a) ); provided , further , that , when an Event of Default exists the Administrative Agent and the Lenders (or any of their respective representatives or independent contractors) may do any of the foregoing at the expense of the Loan Parties at any time during normal business hours and without advance notice.

(b) Consider, in good faith, the recommendations of the Administrative Agent and the Lenders or their respective designated representatives in connection with the matters on which they are consulted as described in clause (a) above, recognizing that the ultimate discretion with respect to all such matters shall be retained by the Loan Parties.

7.11 Use of Proceeds.

(a) Use the proceeds of the Term A Loans (i) to repay existing indebtedness on the Funding Date, (ii) for investment in clinical development programs and the expansion of commercial activities and (iii) for other general corporate purposes; provided , that , in no event shall the proceeds of the Term A Loans be used in contravention of any Law or of any Investment Document.

(b) Use the proceeds of the Term B-1 Loans, Term B-2 Loans and Term B-3 Loans (i) for investment in clinical development programs and the expansion of commercial activities and (ii) for other general corporate purposes; provided , that , in no event shall the proceeds of the Term B-1 Loans, Term B-2 Loans or Term B-3 Loans be used in contravention of any Law or of any Investment Document.

(c) Use the proceeds of the Term C Loans to consummate Approved Strategic Investments and to pay fees and expenses in connection therewith; provided , that , in no event shall

the proceeds of the Term C Loans be used in contravention of any Law or of any Investment Document.

7.12 Additional Subsidiaries.

(a) Within thirty (30) days after the acquisition or formation of any Subsidiary (or such later date as the Administrative Agent may agree in its sole discretion), notify the Administrative Agent thereof in writing, together with the (i) jurisdiction of organization (or foreign equivalent), (ii) number of shares of each class of Equity Interests outstanding, (iii) number and percentage of outstanding shares of each class owned (directly or indirectly) by any Loan Party or any Subsidiary, (iv) number and effect, if exercised, of all outstanding options, warrants, rights of conversion or purchase and all other similar rights with respect thereto and (v) identification as to whether such Subsidiary is an Excluded Subsidiary; and

(b) Within sixty (60) days (or such later date as the Administrative Agent may agree in its sole discretion) after (i) the acquisition or formation of any Subsidiary (other than any Excluded Subsidiary) or (ii) the date on which any Subsidiary that was formerly an Excluded Subsidiary ceases to be an Excluded Subsidiary, in each case, cause such Person to (A) become a Guarantor by executing and delivering to the Administrative Agent a Joinder Agreement or such other documents as the Administrative Agent shall reasonably request for such purpose and (B) deliver to the Administrative Agent documents of the types referred to in Sections 5.02(f) and (g) and favorable opinions of counsel to such Person (which shall cover, among other things, the legality, validity, binding effect and enforceability of the documentation referred to in clause (A) ), all in form, content and scope reasonably satisfactory to the Administrative Agent.

(c) on the Funding Date, cause each Subsidiary (other than any Excluded Subsidiary) that was formed or acquired after the Effective Date but prior to the Funding Date to (i) become a Guarantor by executing and delivering to the Administrative Agent a Joinder Agreement or such other documents as the Administrative Agent shall reasonably request for such purpose and (ii) deliver to the Administrative Agent documents of the types referred to in Sections 5.02(f) and (g) and favorable opinions of counsel to such Person (which shall cover, among other things, the legality, validity, binding effect and enforceability of the documentation referred to in clause (i) ), all in form, content and scope reasonably satisfactory to the Administrative Agent.

7.13 ERISA Compliance.

Do, and cause each of its ERISA Affiliates to do, each of the following: (a) maintain each Plan in compliance in all material respects with the applicable provisions of ERISA, the Internal Revenue Code and other federal or state law, (b) cause each Plan that is qualified under Section 401(a) of the Internal Revenue Code to maintain such qualification, and (c) make any required contributions to any Plan subject to Section 412, Section 430 or Section 431 of the Internal Revenue Code.

7.14 Pledged Assets.

(a) Equity Interests . Cause 100% of the issued and outstanding Equity Interests of each Subsidiary directly owned by a Loan Party to be subject at all times to a first priority, perfected Lien in favor of the Administrative Agent, for the benefit of the Secured Parties, pursuant to the terms and conditions of the Collateral Documents, together with opinions of counsel and any filings and deliveries necessary in connection therewith to perfect the security interests therein, all in form and substance satisfactory to the Administrative Agent. It is understood and agreed that the Loan Parties

shall have thirty (30) days after the acquisition of any Foreign Subsidiary after the Funding Date to comply with this Section 7.14(a) with respect to such Loan Party’s pledge of its Equity Interests in such Foreign Subsidiary.

(b) Other Property . (i) Cause all property (other than Excluded Property) of each Loan Party to be subject at all times to first priority perfected Liens, which Liens are superior in right to any other Person (subject to Permitted Liens) (and, in the case of owned real property, title insured Liens), in each case, in favor of the Administrative Agent to secure the Obligations pursuant to the Collateral Documents (and subject to the terms and conditions of the Collateral Documents) or, with respect to any such property acquired subsequent to the Funding Date, such other additional security documents as the Administrative Agent shall request and, in connection with the foregoing, deliver to the Administrative Agent such other documentation as the Administrative Agent may request including filings and deliveries necessary to perfect such Liens, Organization Documents, resolutions, Real Property Security Documents and favorable opinions of counsel to such Person, all in form, content and scope reasonably satisfactory to the Administrative Agent; and (ii) use commercially reasonable efforts to obtain and deliver to the Administrative Agent Collateral Access Agreements with respect to leased real property to the extent required by this Agreement and the Collateral Documents.

(c) Material Contracts . Ensure, and cause each of their respective Subsidiaries to ensure, that at all times the exercise of the rights of the Administrative Agent or any Lender under any Loan Document (including the realization, sale or assignment by the Administrative Agent or a Lender of any Equity Interests in any Subsidiary directly owned by such Loan Party) would not conflict with (i) any Material Contract to which any Loan Party or any of its respective Subsidiaries is a party or which is binding upon such Loan Party or such Subsidiary or any of such Loan Party’s or such Subsidiary’s assets or (ii) any Loan Party’s Organization Documents.

7.15 Compliance with Material Contracts.

Comply in all respects with each Material Contract of such Person except where the failure to comply, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

7.16 Maintenance of Regulatory Approvals, Contracts, IP Rights, Etc.

Each Loan Party will, and will cause each of its Subsidiaries (to the extent applicable) to, (a) maintain in full force and effect all Regulatory Approvals (including the Product Authorizations), contracts, or other rights necessary for the operations of such Loan Party’s or such Subsidiary’s business, as the case may be, including in respect of all related Product Commercialization and Development Activities, (b) promptly after any Loan Party has knowledge thereof, notify the Administrative Agent of any product recalls, safety alerts, corrections, withdrawals, marketing suspensions or removals conducted, to be undertaken or issued by such Loan Party, any of their respective Subsidiaries or any of their respective agents, suppliers, licensors or licensees, as the case may be, whether voluntary or at the request, demand or order of any Regulatory Authority or otherwise with respect to any Product, or the occurrence of any act, event or omission that is reasonably likely to result in the undertaking or issuing of any such action or item, (c) maintain in full force and effect, and pay all costs and expenses relating to (i) all Material Contracts, (ii) all IP Rights owned or controlled by such Loan Party or any such Subsidiary that is related to any Product or Product Commercialization and Development Activities or otherwise useful in or material, either individually or in the aggregate, to the business of any Loan Party or Subsidiary and (iii) all Product Assets owned or controlled by such Loan Party or any Subsidiary that are used in or necessary for related Product Commercialization

and Development Activities, (d) promptly after learning thereof, notify the Administrative Agent of any infringement or other violation by any Person of such Loan Party’s or any of its Subsidiaries’ IP Rights, and diligently pursue any such infringement or other violation, except in any specific circumstance where both (i) the Loan Parties are able to demonstrate that it is not commercially reasonable to do so and (ii) where not doing so does not materially adversely affect any Product or the Product Commercialization and Development Activities related to such Product, (e) use commercially reasonable efforts to pursue and maintain in full force and effect legal protection for all new IP Rights developed or controlled by such Loan Party or any of its Subsidiaries, as the case may be, that is related to any Product or Product Commercialization and Development Activities or otherwise useful in or material, either individually or in the aggregate, to the business of any Loan Party or Subsidiary and (f) promptly after learning thereof, notify the Administrative Agent of any claim by any Person that such Loan Party or any of its Subsidiaries, including in connection with any Product Commercialization and Development Activities, has infringed upon any IP Rights of such Person.

7.17 Anti-Corruption Laws.

Conduct its business in compliance in all material respects with the United States Foreign Corrupt Practices Act of 1977, the UK Bribery Act 2010 and other similar anti-corruption legislation in other jurisdictions and maintain policies and procedures designed to promote and achieve compliance with such laws.

7.18 Cash Management.

(a) Maintain all deposit accounts (including, without limitation, the Specified Deposit Account), disbursement accounts, securities accounts, investment accounts (and other similar accounts) and lockboxes located in the United States or the British Virgin Islands, in each case, with a bank or financial institution that is acceptable to the Administrative Agent and ensure that each such account or lockbox is subject to a Qualifying Control Agreement (each such deposit account, disbursement account, securities account, investment account (or similar account) and lockbox (a “ Controlled Account ”)), with all cash, checks and other similar items of payment in such account or lockbox securing payment of the Obligations and such Loan Party shall have granted a Lien to the Administrative Agent, for the benefit of the Secured Parties, over such Controlled Accounts;

(b) Deposit promptly (and in any event no later than five (5) Business Days) all cash, checks, drafts or other similar items of payment relating to or constituting payments made in respect of any and all accounts and other rights and interests of each BVI Loan Party and each U.S. Loan Party (including pursuant to clause (c) below) into Controlled Accounts;

(c) To the extent that any Loan Party or any Subsidiary, in each case, that is not a BVI Loan Party or a U.S. Loan Party, individually or in the aggregate when taken together with all other such Loan Parties and Subsidiaries, holds cash on hand (other than cash maintained in a Controlled Account) in excess of $2,000,000, such excess amount shall, within five (5) Business Days be transferred, assigned or otherwise (i) delivered to a BVI Loan Party or a U.S. Loan Party for deposit into a Controlled Account or (ii) in the case of Establishment Labs Sociedad Anonima, deposited into the Specified Deposit Account, in each case in compliance with clauses (a) and (b) above; and

(d) At any time after the occurrence and during the continuance of an Event of Default, at the request of the Administrative Agent, cause all payments constituting proceeds of accounts of each BVI Loan Party, each U.S. Loan Party and each Costa Rican Loan Party to be directed into lockbox accounts that are subject to Qualifying Control Agreements.

7.19 Post-Closing Obligations.

(a) Within five (5) Business Days of the Funding Date (or such longer period of time as may be agreed to by the Administrative Agent in its sole discretion), arrange for the filing of the particulars of a cessation of (i) that certain charge in respect of the property of the Borrower registered on September 29, 2016 with identification number MTE6TZ and Perceptive Credit Holdings, LP as the trustee and (ii) that certain charge in respect of the property of the Borrower registered on September 14, 2015 with identification number VPHPR3 and CPH TU, LP as the chargee, in each case with the registrar of corporate affairs in the British Virgin Islands in accordance with section 165 of the BVI Business Companies Act, 2004.

(b) Within the time periods set forth therefor on Schedule 7.19 (or such longer periods of time as may be agreed to by the Administrative Agent in its sole discretion), deliver to the Administrative Agent such other documents, instruments, certificates or agreements as are listed on Schedule 7.19 or take such other actions as are described on Schedule 7.19 , in each case in form and substance reasonably satisfactory to the Administrative Agent.

7.20 Equity Issuances .

(a) Required Issuances . During the period (i) from July 1, 2018 through and including June 30, 2019, receive at least $30,000,000 in cash and Cash Equivalents from the issuance of Qualified Equity Interests (other than in connection with any Specified Cure Contribution) of the Borrower and (ii) from July 1, 2019 through and including June 30, 2020, receive at least $25,000,000 in cash and Cash Equivalents from the issuance of Qualified Equity Interests (other than in connection with any Specified Cure Contribution) of the Borrower; provided , that , (x) until clause (a)(i) has been satisfied by the Loan Parties, the Loan Parties shall receive (A) at least $15,000,000 in cash and Cash Equivalents from the issuance of Qualified Equity Interests (other than in connection with any Specified Cure Contribution) of the Borrower during the period from July 1, 2018 through and including December 31, 2018 and (B) at least $15,000,000 in cash and Cash Equivalents from the issuance of Qualified Equity Interests (other than in connection with any Specified Cure Contribution) of the Borrower during the period from January 1, 2019 through and including June 30, 2019 and (y) until clause (a)(ii) has been satisfied, the Loan Parties shall receive (A) at least $12,500,000 in cash and Cash Equivalents from the issuance of Qualified Equity Interests (other than in connection with any Specified Cure Contribution) of the Borrower during the period from July 1, 2019 through and including December 31, 2019 and (B) at least $12,500,000 in cash and Cash Equivalents from the issuance of Qualified Equity Interests (other than in connection with any Specified Cure Contribution) of the Borrower during the period from January 1, 2020 through and including June 30, 2020; provided , however , that , if the Borrower completes a Qualifying IPO on or before December 31, 2018 that results in the Borrower receiving at least $57,500,0000 in cash and Cash Equivalents, all requirements of this clause (a) shall be deemed satisfied on and as of such date of receipt.

(b) Investor Requirement . Ensure that at least seventy-five percent (75%) of the Qualified Equity Interests issued pursuant to clause (a) are purchased by institutional investors reasonably acceptable to the Administrative Agent and on terms and conditions reasonably satisfactory to the Administrative Agent (not to be unreasonably delayed or withheld); provided , that , if the Borrower completes a Qualifying IPO on or before December 31, 2018 that results in the Borrower receiving at least $57,500,0000 in cash and Cash Equivalents, all requirements of this clause (b) shall be deemed satisfied on and as of such date of receipt.

ARTICLE VIII.

NEGATIVE COVENANTS

On the Funding Date and thereafter, so long as any Lender shall have any Commitment hereunder, any Loan or other Obligation (other than contingent indemnification obligations for which no claim has been asserted) hereunder shall remain unpaid or unsatisfied, no Loan Party shall, nor shall it permit any Subsidiary to, directly or indirectly:

8.01 Liens.

Create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter acquired, other than the following:

(a) Liens pursuant to any Loan Document;

(b) Liens existing on the Effective Date and listed on Schedule 8.01 to the Disclosure Letter;

(c) Liens (other than any Liens imposed under ERISA) for taxes, assessments or governmental charges or levies not yet due or which are being contested in good faith and by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the books of the applicable Person in accordance with GAAP;

(d) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen and suppliers and other Liens imposed by law or pursuant to customary reservations or retentions of title arising in the ordinary course of business; provided , that , such Liens secure only amounts not yet due and payable or, if due and payable, are unfiled and no other action has been taken to enforce the same or are being contested in good faith by appropriate proceedings for which adequate reserves determined in accordance with GAAP have been established;

(e) pledges or deposits in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other social security legislation, other than any Lien imposed by ERISA;

(f) deposits to secure the performance of bids, trade contracts and leases (other than Indebtedness), statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;

(g) easements, rights-of-way, restrictions and other similar encumbrances affecting real property which, in the aggregate, are not substantial in amount, and which do not in any case materially detract from the value of the property subject thereto or materially interfere with the ordinary conduct of the business of the applicable Person;

(h) Liens securing judgments for the payment of money (or appeal or other surety bonds relating to such judgments) not constituting an Event of Default under Section 9.01(h) ;

(i) Liens securing Indebtedness permitted under Section 8.03(e) ; provided , that : (i) such Liens do not at any time encumber any property other than the property financed by such Indebtedness, (ii) the Indebtedness secured thereby does not exceed the cost of acquiring, purchasing, constructing or improving such property (negotiated on an arm’s length basis) and (iii) such Liens attach to such property concurrently with or within one hundred eighty (180) days after the acquisition thereof (or, in the case of any such property owned by such Loan Party or such Subsidiary as of the Effective Date, within one hundred eighty (180) days of the Effective Date);

(j) licenses, sublicenses, leases or subleases (other than relating to intellectual property) granted to others in the ordinary course of business not interfering in any material respect with the business of any Loan Party or any Subsidiary;

(k) bankers’ liens, rights of setoff and similar Liens incurred on deposits made in the ordinary course of business;

(l) Liens of a Permitted Senior Revolving Credit Lender on Permitted Senior Revolving Credit Priority Collateral securing only the Permitted Senior Revolving Credit Indebtedness owing to such Permitted Senior Revolving Credit Lender, subject to compliance with the terms and provisions of Section 8.03(g) and the definition of “Permitted Senior Revolving Credit Indebtedness”;

(m) solely until the Funding Date, Liens securing Indebtedness under the Existing Credit Agreement;

(n) Liens on fee owned real property of the Loan Parties securing Indebtedness permitted by Section 8.03(h) ;

(o) any Lien existing on any property or asset prior to the acquisition thereof by the Borrower or any Subsidiary after the Effective Date or existing on any property or asset prior to the merger, consolidation or becoming a Subsidiary of any Person that is merged or consolidated with or into the Borrower or any of its Subsidiaries after the Effective Date or that becomes a Subsidiary after the Effective Date; provided , that , (i) such Lien is not created in contemplation of or in connection with such acquisition or such Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not apply to any other property or assets of the Borrower or any Subsidiary (other than improvements, accessions, proceeds, dividends or distributions in respect thereof and assets fixed or appurtenant thereto) and (iii) such Lien shall secure only those obligations which it secures on the date of such acquisition or the date such Person becomes a Subsidiary, as the case may be;

(p) Liens in favor of a seller solely on any cash earnest money deposits made by the Borrower or any of its Subsidiaries in connection with any letter of intent or purchase agreement with respect to any Permitted Acquisition or other Investment permitted hereunder;

(q) (i) Liens of a collection bank arising under Section 4-210 of the Uniform Commercial Code on items in the course of collection and (ii) Liens securing cash management obligations and any obligations under cash management agreements (in each case, that do not constitute Indebtedness) in the ordinary course of business;

(r) licenses and sublicenses of intellectual property permitted by Section 8.19(b) ; and

(s) additional Liens incurred by the Borrower and its Subsidiaries so long as the aggregate outstanding principal amount of Indebtedness and other obligations secured thereby do not exceed $500,000 at any time.

Notwithstanding anything to the contrary in this Section 8.01 , no Lien permitted under clauses (b) through (q) or clause (s) shall apply to any Material IP Rights.

8.02 Investments.

Make any Investments, except:

(a) Investments held by any Loan Party or any Subsidiary in the form of cash or Cash Equivalents;

(b) Investments existing as of the Effective Date and set forth in Schedule 8.02 to the Disclosure Letter;

(c) (i) Investments by Loan Parties in any Person that is a Qualified Loan Party prior to giving effect to such Investment, (ii) Investments by (A) Loan Parties (that are not Brazilian Loan Parties) in Brazilian Loan Parties, in an aggregate amount not to exceed $25,000,000 ( provided , that , such amount shall increase by $0.25 for each $1.00 of cash and Cash Equivalents received by the Borrower from the issuance of its Qualified Equity Interests (other than in connection with any Specified Cure Contribution) on or after July 1, 2018 (so long as such cash and Cash Equivalents are not otherwise applied to any other permitted use under this Agreement); provided , however , that , in no event shall such amount exceed $40,000,000) at any one time outstanding and (B) Brazilian Loan Parties in Brazilian Loan Parties, (iii) Investments by Subsidiaries that are not Loan Parties in (A) Loan Parties and (B) any other Subsidiary that is not a Loan Party, (iv) Investments by Qualified Loan Parties in (A) Loan Parties that are not Qualified Loan Parties (other than Brazilian Loan Parties), in an aggregate amount not to exceed $5,000,000 at any one time outstanding; provided , that , the aggregate amount of any Investment made pursuant to clause (ii)(A) that indirectly flows through a Loan Party that is not a Qualified Loan Party (other than a Brazilian Loan Party) shall not be deemed to apply to this clause (iv)(A) , and (B) Subsidiaries that are not Loan Parties, in an aggregate amount not to exceed, together with all Investments made pursuant to clause (c)(v)(B) , $2,000,000 at any one time outstanding and (v) Investments by Loan Parties that are not Qualified Loan Parties in (A) other Loan Parties that are not Qualified Loan Parties (other than Brazilian Loan Parties) and (B) Subsidiaries that are not Loan Parties, in an aggregate amount not to exceed, together with all Investments made pursuant to clause (c)(iv)(B) , $2,000,000 at any one time outstanding;

(d) extensions of credit to non-Affiliates in the nature of accounts receivable or notes receivable arising from the sales of goods or services in the ordinary course of business;

(e) Permitted Acquisitions and Approved Strategic Investments;

(f) Swap Contracts permitted under Section 8.03(d) ;

(g) Investments (including debt obligations) received in connection with the bankruptcy or reorganization of customers or suppliers and in settlement of delinquent obligations of, and other disputes with, customers or suppliers arising in the ordinary course of business;

(h) Investments consisting of security deposits with utilities and other like Persons made in the ordinary course of business;

(i) employee loans, travel advances and guarantees in accordance with the Loan Parties’ usual and customary practices with respect thereto (if permitted by applicable Law), which in the aggregate shall not exceed $250,000 outstanding at any time;

(j) Investments received in connection with any insolvency proceedings in respect of any customers, suppliers or clients and in settlement of delinquent obligations of, and other disputes with, customers, suppliers or clients;

(k) Guarantees permitted by Section 8.03 (other than by reference to this Section 8.02 (or any subclause hereof)); and

(l) other Investments not permitted by any of the foregoing clauses of this Section 8.02 , in an aggregate amount not to exceed $500,000 at any one time outstanding.

8.03 Indebtedness.

Create, incur, assume or suffer to exist any Indebtedness, except:

(a) Indebtedness under the Loan Documents;

(b) Indebtedness (other than by reference to this Section 8.03 (or any sub-clause hereof)) existing on the Effective Date and described on Schedule 8.03 to the Disclosure Letter and Permitted Refinancings thereof;

(c) (i) intercompany Indebtedness permitted under Section 8.02 (other than by reference to this Section 8.03 (or any sub-clause hereof)) and (ii) Guarantees permitted by Section 8.02 (other than by reference to this Section 8.03 (or any subclause hereof));

(d) obligations (contingent or otherwise) of any Loan Party or any Subsidiary existing or arising under any Swap Contract; provided , that , (i) such obligations are (or were) entered into by such Person in the ordinary course of business for the purpose of directly mitigating risks associated with liabilities, commitments, investments, assets, or property held or reasonably anticipated by such Person, or changes in the value of securities issued by such Person, and not for purposes of speculation or taking a “market view” and (ii) such Swap Contract does not contain any provision exonerating the non-defaulting party from its obligation to make payments on outstanding transactions to the defaulting party;

(e) purchase money Indebtedness (including obligations in respect of Capital Leases or Synthetic Leases) incurred by any Loan Party or any of their respective Subsidiaries to finance the acquisition, purchase, construction or improvement of fixed assets, and renewals, refinancings and extensions thereof; provided , that , (i) such Indebtedness when incurred shall not exceed the cost of acquiring, purchasing, constructing or improving such asset(s), (ii) no such Indebtedness shall be refinanced for a principal amount in excess of the principal balance outstanding thereon, plus any fees and expenses incurred in connection with such refinancing and any reasonable premium paid in connection with such refinancing, (iii) the aggregate outstanding principal amount of all Indebtedness outstanding in reliance on this clause (e) shall not exceed $4,000,000 at any one time outstanding and (iv) the aggregate outstanding principal amount of all Indebtedness outstanding in

reliance on this clause (e) , Section 8.03(g) and Section 8.03(h) , when taken together, shall not exceed $12,000,000 at any one time outstanding;

(f) unsecured Indebtedness in respect of netting services, overdraft protections, employee credit card programs, automatic clearinghouse arrangements and similar arrangements in each case in connection with deposit accounts and Indebtedness arising from the honoring of a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business; provided , that , (x) any such Indebtedness is extinguished within thirty (30) days and (y) the aggregate outstanding principal amount of such Indebtedness shall not exceed $500,000 at any one time outstanding;

(g) Permitted Senior Revolving Credit Indebtedness in an aggregate principal amount not to exceed at any one time outstanding $4,000,000 pursuant to one or more revolving credit facilities; provided , that , (x) no Default or Event of Default shall have occurred and be continuing both immediately before and immediately after the effectiveness of any Permitted Senior Revolving Credit Documents, (y) prior to the incurrence of any such Indebtedness, (i) the Administrative Agent, the Loan Parties and the applicable Permitted Senior Revolving Credit Lender shall have entered into an intercreditor agreement reasonably satisfactory to the Administrative Agent pursuant to which (A) such Permitted Senior Revolving Credit Lender may be granted a first priority security interest only in the accounts receivable and/or inventory of Establishment Labs Sociedad Anonima and proceeds thereof (collectively, the “ Permitted Senior Revolving Credit Priority Collateral ”), (B) the Administrative Agent, on behalf of the Secured Parties, shall be granted a second priority security interest in the Permitted Senior Revolving Credit Priority Collateral, (C) the Administrative Agent, on behalf of the Secured Parties, shall maintain its first priority security interest in all other assets of the Loan Parties (other than Excluded Property) and (D) such Permitted Senior Revolving Credit Lender shall not be granted a security interest in any property of the Loan Parties other than the Permitted Senior Revolving Credit Priority Collateral and (ii) the Administrative Agent and the Loan Parties shall have entered into amendments, in each case in form and substance reasonably satisfactory to the Administrative Agent, to this Agreement and such other Loan Documents as required to, among other things, include in the Loan Documents such additional representations, warranties, covenants and defaults as are included in the applicable Permitted Senior Revolving Credit Documents (but not included in the Loan Documents at such time) and (z) the aggregate outstanding principal amount of all Indebtedness incurred in reliance on this clause (g) , Section 8.03(e) and Section 8.03(h) , when taken together, shall not exceed $12,000,000 at any one time outstanding;

(h) Indebtedness hereafter incurred by any Loan Party or any of their respective Subsidiaries to finance the purchase, construction or improvement of real property, and renewals and extensions thereof; provided , that , (i) such Indebtedness shall be secured only by real property (and, for the avoidance of doubt, by no other assets of any Loan Party or any Subsidiary), (ii) no such Indebtedness shall be refinanced for a principal amount in excess of the principal balance outstanding thereon at the time of such refinancing, plus any fees and expenses incurred in connection with such refinancing and any reasonable premium paid in connection with such refinancing, (iii) the aggregate outstanding principal amount of all Indebtedness incurred in reliance on this clause (h) shall not exceed $10,000,000 at any one time outstanding and (iv) the aggregate outstanding principal amount of all Indebtedness incurred in reliance on this clause (h) , Section 8.03(e) and Section 8.03(g) , when taken together, shall not exceed $12,000,000 at any one time outstanding;

(i) solely until the Funding Date, Indebtedness under the Existing Credit Agreement;

(j) accounts payable to trade creditors for goods and services and current operating liabilities (not the result of the borrowing of money) incurred in the ordinary course of the Loan Parties and their respective Subsidiaries’ business in accordance with customary terms and paid within the specified time, unless contested in good faith by appropriate proceedings and reserved for in accordance with GAAP;

(k) Indebtedness consisting of guarantees resulting from the endorsement of negotiable instruments for collection in the ordinary course of business;

(l) other unsecured Indebtedness not permitted by any of the other clauses of this Section 8.03 , in an aggregate principal amount not to exceed $500,000 at any one time outstanding;

(m) Indebtedness of any Person that becomes a Subsidiary after the Effective Date; provided , that , (i) such Indebtedness exists at the time such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary and (ii) the aggregate principal amount of all such Indebtedness outstanding in reliance on this clause (m) shall not exceed $500,000 at any one time outstanding;

(n) unsecured Earn Out Obligations in connection with Permitted Acquisitions; and

(o) unsecured Indebtedness of the Borrower owing to (i) solely until August 1, 2019, JW Partners, LP pursuant to that certain Warrant Payment Agreement dated as of August 24, 2017 between the Borrower and JW Partners, LP in an aggregate amount not to exceed $1,589,488.64 at any one time outstanding, (ii) solely until August 1, 2019, JW Opportunities Master Fund, Ltd. pursuant to that certain Warrant Payment Agreement dated as of August 24, 2017 between the Borrower and JW Opportunities Master Fund, Ltd. in an aggregate amount not to exceed $529,829.55 at any one time outstanding, (iii) solely until August 1, 2019, Relativity Healthcare Fund, LLC pursuant to that certain Warrant Cancellation Agreement dated as of August 24, 2017 between the Borrower and Relativity Healthcare Fund, LLC in an aggregate amount not to exceed $141,287.55 at any one time outstanding and (iv) solely until September 24, 2017, Perceptive Credit Holdings, LP pursuant to that certain Warrant Repurchase Agreement dated as of August 24, 2017 between the Borrower and Perceptive Credit Holdings, LP in an aggregate amount not to exceed $2,400,000 at any one time outstanding.

8.04 Fundamental Changes.

Merge, dissolve, liquidate, amalgamate or consolidate with or into another Person, or Dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any Person; provided , that , notwithstanding the foregoing provisions of this Section 8.04 but subject to the terms of Sections 7.12 and 7.14 , (a) the Borrower may merge or consolidate with any of its Subsidiaries, provided , that , the Borrower shall be the continuing or surviving corporation, (b) any Qualified Loan Party (other than the Borrower) may merge, amalgamate or consolidate with any other Qualified Loan Party (other than the Borrower), (c) any Loan Party that is not a Qualified Loan Party may merge, amalgamate or consolidate with any Loan Party (other than the Borrower), provided , that , if a Qualified Loan Party is a party to such transaction, such Qualified Loan Party shall be the continuing or surviving Person, (d) any Subsidiary that is not a Loan Party may be merged or consolidated with or into any Loan Party, provided , that , such Loan Party shall be the continuing or surviving Person, (e) any Subsidiary that is not a Loan Party may be merged or consolidated with or into any other Subsidiary that is not a Loan Party, (f) any Subsidiary that is not a Loan Party may dissolve, liquidate or wind up its affairs at any time, provided , that , such dissolution, liquidation or winding up could not reasonably be

expected to have a Material Adverse Effect and all of its assets and business are transferred to a Loan Party prior to or concurrently with such dissolution, liquidation or winding up and (g) the Borrower and its Subsidiaries may consummate Permitted Acquisitions and Approved Strategic Investments, provided , that , (x) to the extent applicable, such transaction complies with clauses (a) through (f) of the first proviso in this Section 8.04 and (y) to the extent such transaction involves a merger, amalgamation or consolidation with a Person other than the Borrower or any Subsidiary, either (A) the Borrower or such Subsidiary shall be the continuing or surviving Person or (B) the continuing or surviving Person shall comply with the requirements of Section 7.12 and Section 7.14 .

8.05 Dispositions.

Make any Disposition unless (a) the consideration paid in connection therewith shall be cash or Cash Equivalents paid contemporaneous with consummation of the transaction and shall be in an amount not less than the fair market value of the property disposed of, (b) no Default or Event of Default shall have occurred and be continuing both immediately prior to and after giving effect to such Disposition, (c) such transaction does not involve the sale or other disposition of a minority equity interest in any Subsidiary and (d) the aggregate net book value of all of the assets sold or otherwise disposed of in such Disposition together with the aggregate net book value of all assets sold or otherwise disposed of by the Loan Parties and their respective Subsidiaries in all such transactions occurring during the term of this Agreement does not exceed $1,000,000.

8.06 Restricted Payments.

Declare or make, directly or indirectly, any Restricted Payment, except that:

(a) each Subsidiary may make Restricted Payments to any Loan Party;

(b) each Loan Party and each Subsidiary may declare and make dividend payments or other distributions payable solely in the Qualified Capital Stock of such Person;

(c) prior to the commencement of a Qualifying IPO, following the end of any fiscal quarter of the Borrower, to the extent that (i) the Borrower has estimated taxable income for such quarter and (ii) the Borrower’s Board of Directors has determined (in good faith) that holders of the Borrower’s Qualified Capital Stock will be required to pay income tax on such estimated taxable income, distributions to such holders of the Borrower’s Qualified Capital Stock in an amount up to the product of (A) the Borrower’s estimated taxable income allocable to such holders for such fiscal quarter (net of all taxable losses allocated to such holders not previously taken into account pursuant to this sentence and assuming the deductibility of state and local income taxes for federal income tax purposes) multiplied by (B) a percentage equal to the lesser of (x) 25% and (y) a percentage to be reasonably determined by the Board of Directors of the Borrower (acting in good faith); provided , that , prior to making any such Restricted Payment pursuant to this clause (c) , (x) the Board of Directors of the Borrower shall have determined (pursuant to a written resolution) that the timing and amount of such Restricted Payment are reasonably necessary to permit the holders of the Borrower’s Qualified Capital Stock to pay tax on such estimated taxable income and (y) the Borrower shall have delivered to the Administrative Agent a pro forma compliance certificate (certified by a Responsible Officer of the Borrower) demonstrating pro forma compliance with the financial covenants set forth in Sections 8.16 and 8.17 both before and after giving effect to such Restricted Payment;

(d) (i) the Borrower may purchase, redeem, retire or otherwise acquire its Qualified Capital Stock solely to the extent such purchase, redemption, retirement or acquisition is made with

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proceeds received from a substantially concurrent issuance of new Qualified Capital Stock of the Borrower, (ii) to the extent constituting Restricted Payments, the Borrower may repay Indebtedness permitted by Section 8.03(o) to the extent not prohibited by Section 8.11 and (iii) the Borrower may purchase, redeem, retire or otherwise acquire shares of its Qualified Capital Stock from Global Silicone SRL for aggregate consideration not to exceed $2,845,990; provided , that , with respect to this clause (iii) , such purchase occurs within thirty (30) days of the Funding Date;

(e) the Borrower may (i) purchase or pay cash in lieu of fractional shares of its Qualified Capital Stock arising out of dividends, splits, or business combinations or in connection with the issuance of its Qualified Capital Stock pursuant to mergers, consolidations or other acquisitions, in each case, permitted by this Agreement, (ii) pay cash in lieu of fractional shares upon the exercise of warrants, options or other securities convertible into or exercisable for Qualified Capital Stock of the Borrower and (iii) make payments in connection with the retention of Qualified Capital Stock in payment of withholding taxes in connection with equity-based compensation plans to the extent that net share settlement arrangements are deemed to be repurchases; and

(f) the Borrower may make other Restricted Payments not to exceed (i) $600,000 in the fiscal year of the Borrower ending December 31, 2017 and (ii) $500,000 in any fiscal year of the Borrower ending thereafter.

8.07 Change in Nature of Business.

Engage in any material line of business substantially different from those lines of business conducted by the Borrower and its Subsidiaries on the Effective Date or any business substantially related or incidental thereto.

8.08 Transactions with Affiliates and Insiders.

Enter into or permit to exist any transaction or series of transactions with any officer, director, employee or Affiliate of such Person other than (a) advances of working capital to any Loan Party, (b) transfers of cash and assets to any Loan Party, (c) intercompany transactions expressly permitted by Section 8.02 , Section 8.03 , Section 8.04 , Section 8.05 or Section 8.06 , (d) customary compensation and indemnification of, and other employment arrangements with, directors, officers and employees in the ordinary course of business, (e) issuances of Qualified Capital Stock of the Borrower to Affiliates in exchange for cash; provided , that , (i) no Default or Event of Default shall have occurred and be continuing (or could reasonably be expected to occur as a result of such issuance) and (ii) the terms of each such issuance are no less favorable (including the amount of cash received by the Borrower) to the Borrower than those that would be obtained in a comparable arm’s-length transaction with a Person who is not an Affiliate of the Borrower and (f) except as otherwise specifically limited in this Agreement, other transactions which are entered into in the ordinary course of such Person’s business on terms and conditions substantially as favorable to such Person as would be obtainable by it in a comparable arms-length transaction with a Person other than an officer, director or Affiliate.

8.09 Burdensome Agreements.

Enter into, or permit to exist, any Contract that encumbers or restricts the ability of any such Person to (a) make Restricted Payments to any Loan Party, (b) pay any Indebtedness or other obligations owed to any Loan Party, (c) make loans or advances to any Loan Party, (d) transfer any of its property to any Loan Party, (e) pledge its property pursuant to the Loan Documents or any renewals, refinancings, exchanges, refundings or extension thereof or (f) act as a Loan Party pursuant to the Loan Documents or any renewals,

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refinancings, exchanges, refundings or extension thereof, except (in respect of any of the matters referred to in clauses (a) through (e) above) for (i) this Agreement and the other Loan Documents, (ii) any document or instrument governing Indebtedness incurred pursuant to Section 8.03(b) , Section 8.03(e) , Section 8.03(h) ; provided , that , any such restriction contained therein relates only to the asset or assets constructed or acquired in connection therewith, (iii) customary restrictions and conditions contained in any agreement relating to the sale of any property permitted under Section 8.05 pending the consummation of such sale, (iv) any Permitted Senior Revolving Credit Documents, (v) requires the grant of any security for any obligation if such property is given as security for the Obligations, (vi) prohibitions, restrictions and conditions existing on the Effective Date identified on Schedule 8.09 to the Disclosure Letter, (vii) customary provisions contained in leases, subleases, licenses and sublicenses and other contracts restricting the assignment, subletting or encumbrance thereof, customary net worth provisions or similar financial maintenance provisions contained therein and other customary provisions contained in leases, subleases, licenses and sublicenses and other contracts entered into in the ordinary course of business, (viii) prohibitions, restrictions and conditions that are binding on a Subsidiary at the time such Subsidiary first becomes a Subsidiary, so long as such restrictions were not entered into solely in contemplation of such Person becoming a Subsidiary and (ix) customary restrictions under any arrangement with any Governmental Authority imposed on any Subsidiary in connection with governmental grants, financial aid, tax holidays or similar benefits or economic interests.

8.10 Use of Proceeds.

Use the proceeds of any Loan, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the FRB) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose.

8.11 Payment of Other Indebtedness.

Make (or give any notice with respect thereto) any voluntary or optional payment or prepayment or redemption or acquisition for value of (including without limitation, by way of depositing money or securities with the trustee with respect thereto before due for the purpose of paying when due), refund, refinance or exchange of any Indebtedness of any Loan Party or any Subsidiary (other than (i) any of the foregoing payments or transactions relating to (x) Indebtedness arising under the Loan Documents, (y) any Permitted Senior Revolving Credit Indebtedness and (z) the repayment of all Indebtedness owing under the Existing Credit Agreement on the Funding Date, (ii) such payments or transactions that do not exceed an aggregate amount of $1,000,000 per fiscal year, (iii) Permitted Refinancings expressly permitted hereby and (iv) prepayments by the Borrower of Indebtedness permitted by Section 8.03(o) ; provided , that , with respect to this clause (iv) , (x) the funds utilized by the Borrower for any such payments shall consist solely of (A) proceeds received from a substantially concurrent issuance of new Qualified Capital Stock of the Borrower and (B) not more than $1,750,000 of internally generated cash and Cash Equivalents of the Loan Parties and their Subsidiaries and (y) no proceeds of any Loans or any other Indebtedness shall be used for any such payments).

8.12 Organization Documents; Fiscal Year; Legal Name, State of Formation and Form of Entity; Certain Amendments.

(a) Amend, modify or change its Organization Documents in a manner materially adverse to the Administrative Agent or the Lenders, in their capacity as the Administrative Agent or as Lenders, as applicable, under the Loan Documents.

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(b) Change its fiscal year or any fiscal quarter.

(c) Without providing ten (10) days prior written notice to the Administrative Agent, change its name, jurisdiction of organization or form of organization (or foreign equivalent).

(d) Amend, modify or change (or permit the amendment, modification or change of) any of the terms or provisions of any Permitted Senior Revolving Credit Document in a manner adverse to the Administrative Agent or any Secured Party or in violation of the terms and provisions of any intercreditor agreement entered into by the Administrative Agent with respect thereto (for the avoidance of doubt, any amendment, modification or change that is permitted pursuant to any applicable intercreditor agreement shall not be adverse to the Administrative Agent or any Secured Party).

(e) Make any change in accounting policies or reporting practices, except as required by GAAP.

8.13 Ownership of Subsidiaries.

Notwithstanding any other provisions of this Agreement to the contrary, (a) permit any Person (other than any Loan Party or any Wholly Owned Subsidiary) to own any Equity Interests of any Subsidiary, except to qualify directors where required by applicable law or to satisfy other requirements of applicable law with respect to the ownership of Equity Interests of Foreign Subsidiaries, (b) permit any Loan Party or any Subsidiary to issue or have outstanding any shares of Disqualified Capital Stock or (c) create, incur, assume or suffer to exist any Lien on any Equity Interests of any Subsidiary, except for Permitted Liens.

8.14 Sale Leasebacks.

Enter into any Sale and Leaseback Transaction (other than any Permitted Sale and Leaseback Transaction).

8.15 Sanctions; Anti-Corruption Laws.

(a) Directly or indirectly, use the proceeds of any Loan, or lend, contribute or otherwise make available the proceeds of any Loan to any Person, to fund any activities of or business with any Person, or in any Designated Jurisdiction, that, at the time of such funding, is the subject of Sanctions, or in any other manner that will result in a violation by any Person (including any Person participating in the transaction, whether as Lender, Administrative Agent, or otherwise) of Sanctions.

(b) Directly or indirectly, use the proceeds of any Loan for any purpose which would breach the United States Foreign Corrupt Practices Act of 1977, the UK Bribery Act 2010 and other similar anti-corruption legislation in other jurisdictions.

8.16 Minimum Product Revenues.

(a) Minimum Product Revenues . [***]

(b) Cure Right .

(i) Notwithstanding anything to the contrary contained in Section 8.16(a) , in the event that any Loan Party would otherwise be in default of the financial covenant set

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forth in Section 8.16(a) for any period, on or before the tenth (10 ^th ) Business Day subsequent to the due date for delivery of the financial statements for such period pursuant to Section 7.01(a) or (b) , as applicable (such period, the “ Cure Period ”), the Borrower shall have the right to issue its Qualified Capital Stock for cash in an aggregate amount not to exceed the amount necessary to cure the relevant failure to comply with Section 8.16(a) (such contribution, a “ Specified Cure Contribution ”), and upon the receipt by the Borrower of such Specified Cure Contribution within the Cure Period, the financial covenant set forth in Section 8.16(a) shall be recalculated giving effect to the following pro forma adjustments (collectively, the “ Cure Right ”):

(A) Product Revenues shall be increased for the final fiscal quarter of such period (the “ Applicable Quarter ”) and any period of four consecutive fiscal quarters that includes the Applicable Quarter, solely for the purpose of measuring the financial covenant set forth in Section 8.16(a) , and not for any other purpose under this Agreement, by an amount equal to the Specified Cure Contribution; and

(B) If, after giving effect to the foregoing recalculation, the Loan Parties shall then be in compliance with the requirements of the financial covenant set forth in Section 8.16(a) , the Loan Parties shall be deemed to have satisfied the requirements of the financial covenant set forth in Section 8.16(a) as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable breach or default of the covenant set forth in Section 8.16(a) that had occurred shall be deemed cured for the purposes of this Agreement.

(ii) Notwithstanding anything herein to the contrary, (A) the Loan Parties shall provide notice to the Administrative Agent of their intention to exercise the Cure Right no later than the date of delivery of the financial statements evidencing such noncompliance pursuant to Section 7.01(a) or (b) , as applicable, (B) in each four fiscal quarter period, there shall be a period of at least two (2) fiscal quarters in respect of which no Cure Right is exercised, (C) the Cure Right may not be exercised with respect to consecutive fiscal quarters, (D) the Specified Cure Contribution shall be no greater than the amount required for purposes of complying with the financial covenant in Section 8.16(a) , (E) the Specified Cure Contribution received pursuant to any exercise of the Cure Right shall be disregarded for purposes of determining any available basket under any covenant in this Agreement, (F) the Cure Right may be exercised no more than three (3) times during the term of this Agreement and (G) the provisions of this Section 8.16(b) shall in no way limit the Borrower’s ability to issue its Qualified Capital Stock at any time and for the avoidance of doubt, any limitation with respect to amount of the Specified Cure Contribution is only a limitation with respect to the amount of Product Revenue that may count as a Specified Cure Contribution pursuant to the terms of this Section 8.16(b) .

(iii) To the extent that the financial statements delivered pursuant to Section 7.01(a)(i) demonstrate that the Loan Parties would be in default of the financial covenant set forth in Section 8.16(a) for the period covered by such financial statements, notwithstanding the Borrower having exercised a Cure Right with respect to such period on or before the tenth (10 ^th ) Business Day subsequent to the due date for delivery of the financial statements required to be delivered for such period by Section 7.01(a)(ii) , the Loan Parties shall be deemed to have not satisfied the requirements of Section 8.16(a) as of the relevant

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date of determination and the applicable breach or default thereof which had occurred shall not be deemed cured as of such date for all purposes of this Agreement unless and until (but on or before the tenth (10 ^th ) Business Day subsequent to the due date for delivery of the financial statements required to be delivered for such period by Section 7.01(a)(i) ) the Borrower shall have issued Qualified Capital Stock for cash in an aggregate amount equal to the amount necessary to cure the relevant failure to comply with the financial covenant contained in Section 8.16(a) (it being understood and agreed that any such issuance by the Borrower pursuant to this clause (iii) for any period in connection with the financial statements required to be delivered by Section 7.01(a)(i) shall be deemed to be the same “Cure Right” as the “Cure Right” exercised by the Borrower for such period in connection with the financial statements required to be delivered by Section 7.01(a)(ii) ). For the avoidance of doubt, it is understood and agreed that all terms and conditions of clauses (i) – (ii) of this Section 8.16(b) shall apply to any such Cure Right exercised in connection with the financial statements required to be delivered by Sections 7.01(a)(i) and 7.01(a)(ii) .

8.17 Liquidity.

Permit Liquidity of the Loan Parties held in accounts for which the Administrative Agent has received a Qualifying Control Agreement to be less than $4,000,000.

8.18 Modifications and Terminations of Material Contracts.

Except to the extent such action or omission could not reasonably be expected, either individually or in the aggregate, to have or result in a Material Adverse Effect, take or omit to take any action that results in the termination of, or permits any other Person to terminate, any Material Contract or Material IP Rights, other than any bona fide dispute that is being contested in good faith.

8.19 Inbound and Outbound Licenses.

(a) Except as set forth on Schedule 8.19(a) to the Disclosure Letter, no Loan Party shall, nor shall it permit any of its Subsidiaries to, enter into or become or remain bound by (x) any Material Contract or (y) any material inbound license agreement, unless no Default or Event of Default has occurred and is continuing (or would reasonably be expected to occur as a result thereof) and the Loan Parties have (i) provided prior written notice to the Administrative Agent of the material terms of such agreement with a description of its anticipated and projected impact on the relevant Loan Party’s business or financial condition and (ii) taken such commercially reasonable actions as the Administrative Agent may reasonably request to obtain the consent of, or waiver by, any Person whose consent or waiver is necessary for the Administrative Agent to be granted a valid and perfected Lien on such agreement and the right to fully exercise its rights under any of the Loan Documents in the event of a disposition or liquidation (including in connection with a foreclosure) of the rights, assets or property that is the subject of such agreement; provided , that , inbound license agreements in the nature of over the counter software that are commercially available to the public shall not be prohibited by this clause (a) .

(b) Except as set forth on Schedule 8.19(b) to the Disclosure Letter, no Loan Party shall, nor shall it permit any of its Subsidiaries to, enter into or become or remain bound by any outbound license of IP Rights unless such outbound license (i) is duly authorized by the Loan Parties (pursuant to their customary approval process) and entered into on an arm’s-length basis, (ii) is entered into for the purpose of Product Commercialization and Development Activities with respect to a Product, (iii) does not otherwise constitute a Disposition prohibited pursuant to this Agreement, (iv) to the

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extent such IP Rights constitute Collateral, (x) could not reasonably be expected to result in a Material Adverse Effect and (y) does not impair the Administrative Agent from fully exercising its rights under any of the Loan Documents in the event of a disposition or liquidation (including in connection with a foreclosure) of the rights, assets or property that is the subject of such license, (v) is not an exclusive license (whether as to use, geography or otherwise) and (vi) is not perpetual or irrevocable.

ARTICLE IX.

EVENTS OF DEFAULT AND REMEDIES

9.01 Events of Default.

Any of the following shall constitute an Event of Default:

(a) Non-Payment . The Borrower or any other Loan Party fails to pay (i) when and as required to be paid herein, any amount of principal of any Loan, (ii) within three (3) Business Days after the same becomes due, any interest on any Loan, or any fee or prepayment premium due hereunder or (iii) within five (5) Business Days after the same becomes due, any other amount payable hereunder or under any other Investment Document; or

(b) Specific Covenants . Any Loan Party fails to perform or observe any term, covenant or agreement contained in any of Section 7.01 , 7.02 , 7.03 , 7.05 , 7.10 , 7.11 , 7.12 , 7.14 , 7.15 , 7.16 , 7.17 , 7.18 , 7.19 or Article VIII ; or

(c) Other Defaults . Any Loan Party fails to perform or observe any other covenant or agreement (not specified in subsection (a) or (b) above) contained in any Investment Document on its part to be performed or observed and such failure continues for thirty (30) days after the earlier of the date on which (i) a Responsible Officer of any Loan Party becomes aware of such failure and (ii) written notice thereof shall have been given to the Borrower by the Administrative Agent or any Lender; or

(d) Representations and Warranties . Any representation, warranty, certification or statement of fact made or deemed made by or on behalf of the Borrower or any other Loan Party herein, in any other Investment Document, or in any document delivered in connection herewith or therewith shall be incorrect or misleading in any material respect when made or deemed made; or

(e) Cross-Default . (i) Any Loan Party or any Subsidiary (A) fails to make any payment when due (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise), but only after the expiration of any grace period applicable thereto, in respect of any Indebtedness or Guarantee (other than Indebtedness hereunder and Indebtedness under Swap Contracts) having an aggregate principal amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated credit arrangement) of more than the Threshold Amount or (B) fails to observe or perform any other agreement or condition relating to any such Indebtedness or Guarantee or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event occurs, the effect of which default or other event is to cause, or to permit the holder or holders of such Indebtedness or the beneficiary or beneficiaries of such Guarantee (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause (after the expiration of any applicable grace or cure period applicable thereto), with the giving of notice if required, such Indebtedness to be demanded or to become due or to be

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repurchased, prepaid, defeased or redeemed (automatically or otherwise), or an offer to repurchase, prepay, defease or redeem such Indebtedness to be made, prior to its stated maturity, or such Guarantee to become payable or cash collateral in respect thereof to be demanded or (ii) there occurs under any Swap Contract an Early Termination Date (as defined in such Swap Contract) resulting from (A) any event of default under such Swap Contract as to which any Loan Party or any Subsidiary is the Defaulting Party (as defined in such Swap Contract) or (B) any Termination Event (as so defined) under such Swap Contract as to which any Loan Party or any Subsidiary is an Affected Party (as so defined) and, in either event, the Swap Termination Value owed by such Loan Party or such Subsidiary as a result thereof is greater than the Threshold Amount; or

(f) Insolvency Proceedings, Etc. (i) Any Loan Party or any of its Subsidiaries institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; or applies for or consents to the appointment of any receiver, administrative receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property; or any receiver, administrative receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without the application or consent of such Person and the appointment continues undischarged or unstayed for sixty (60) calendar days or any proceeding under any Debtor Relief Law relating to any such Person or to all or any material part of its property is instituted without the consent of such Person and continues undismissed or unstayed for sixty (60) calendar days, or an order for relief is entered in any such proceeding or (ii) any BVI Loan Party ceases to be “solvent” as such term is defined in the Insolvency Act, 2003 of the British Virgin Islands; or

(g) Inability to Pay Debts; Attachment . (i) Any Loan Party or any of its Subsidiaries becomes unable or admits in writing its inability or fails generally to pay its debts as they become due or (ii) any writ or warrant of attachment or execution or similar process is issued or levied against all or any material part of the property of any such Person and is not released, vacated or fully bonded within thirty (30) days after its issue or levy; or

(h) Judgments . There is entered against any Loan Party or any Subsidiary (i) one or more final judgments or orders for the payment of money in an aggregate amount exceeding the Threshold Amount (to the extent not covered by independent third-party insurance as to which the insurer does not dispute coverage) or (ii) any one or more non-monetary final judgments that have, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect and, in either case, (A) enforcement proceedings are commenced by any creditor upon such judgment or order or (B) there is a period of thirty (30) consecutive days during which a stay of enforcement of such judgment, by reason of a pending appeal or otherwise, is not in effect; or

(i) ERISA . (i) An ERISA Event occurs with respect to any Pension Plan or Multiemployer Plan which has resulted or would reasonably be expected to result in liability of any Loan Party under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of the Threshold Amount or (ii) any Loan Party or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability, if any, under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of the Threshold Amount; or

(j) Employee Benefit Non-U.S. Plans . (i) There shall occur one or more Employee Benefit Non-U.S. Plan Events which individually or in the aggregate results in or would reasonably be expected to result in liability of the Borrower and its Subsidiaries in excess of the Threshold

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Amount during the term hereof; or (ii) there exists any fact or circumstance that reasonably would be expected to result in the imposition of a Lien or security interest under any applicable Laws, statutes, rules, regulations and orders to which any Employee Benefit Non-U.S. Plan is subject, on assets of the Borrower or any of its Subsidiaries; or

(k) Invalidity of Investment Documents . Any Investment Document, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or thereunder, ceases to be in full force and effect; or any Loan Party or any other Person contests in any manner the validity or enforceability of any Investment Document; or any Loan Party denies that it has any or further liability or obligation under any Investment Document, or purports to revoke, terminate or rescind any Investment Document; or

(l) Change of Control . There occurs any Change of Control; or

(m) Invalidity of Subordination Provisions . Any subordination provision in any document or instrument governing Indebtedness that is purported to be subordinated to the Obligations or any subordination provision in any subordination agreement that relates to any Indebtedness that is to be subordinated to the Obligations, or any subordination provision in any guaranty by any Loan Party of any such Indebtedness, shall cease to be in full force and effect, or any Person (including the holder of any such Indebtedness) shall contest in any manner the validity, binding nature or enforceability of any such provision; or

(n) Permitted Senior Revolving Credit Indebtedness . There occurs an “Event of Default” (or any comparable term) under, and as defined in, any Permitted Senior Revolving Credit Document; or

(o) Key Person Event . There occurs a Key Person Event; or

(p) Regulatory Matters, Etc. There occurs any of the following: (i) the FDA or any other Regulatory Authority initiates an enforcement action against, or issues a warning letter with respect to, any Loan Party or any of their respective Subsidiaries, any Product or any manufacturing facilities for any Product that causes any Loan Party or any of their respective Subsidiaries to discontinue or withdraw, or would reasonably be expected to cause any Loan Party to discontinue or withdraw, marketing or sales of any Product that has generated or is expected to generate at least $250,000 in revenue for the Loan Parties and their respective Subsidiaries on a consolidated basis over any period of twelve (12) consecutive months, or causes a delay in the manufacture or sale of any such Product, which discontinuance or delay would reasonably be expected to last for more than thirty (30) days, (ii) a recall of any Product that has generated or is expected to generate at least $250,000 in revenue for the Loan Parties and their respective Subsidiaries on a consolidated basis over any period of twelve (12) consecutive months or (iii) any Loan Party enters into a settlement agreement with the FDA or any other Regulatory Authority that results in aggregate liability as to any single or related series of transactions, incidents or conditions, in excess of $250,000; or

(q) Material Adverse Effect . There occurs any circumstance or circumstances that could reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect.

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9.02 Remedies Upon Event of Default.

If any Event of Default occurs and is continuing, the Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders, take any or all of the following actions:

(a) declare the commitment of each Lender to make Loans to be terminated, whereupon such commitments and obligation shall be terminated;

(b) declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon and all other amounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Loan Parties; and

(c) exercise on behalf of itself and the Lenders all rights and remedies available to it and the Lenders under the Loan Documents;

provided , however , that , upon the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code of the United States, the obligation of each Lender to make Loans shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, in each case without further act of the Administrative Agent or any Lender.

If the Obligations are accelerated for any reason, the prepayment premium required by Section 2.03(d) will also be due and payable as though such Obligations were voluntarily prepaid and any discount on the Loans shall be deemed earned in full and, in each case, shall constitute part of the Obligations, in view of the impracticability and extreme difficulty of ascertaining actual damages and by mutual agreement of the parties as to a reasonable calculation of each Lender’s lost profits as a result thereof. Any prepayment premium required by Section 2.03(d) payable pursuant to the preceding sentence shall be presumed to be the liquidated damages sustained by each Lender as the result of the early termination and the Borrower agrees that it is reasonable under the circumstances currently existing. The prepayment premium required by Section 2.03(d) shall also be payable and any discount on the Loans shall be deemed earned in full, in each case, in the event that the Obligations (and/or this Agreement) are satisfied or released by foreclosure (whether by power of judicial proceeding), deed in lieu of foreclosure or by any other means. TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE BORROWER EXPRESSLY WAIVES THE PROVISIONS OF ANY PRESENT OR FUTURE STATUTE OR LAW THAT PROHIBITS OR MAY PROHIBIT THE COLLECTION OF THE FOREGOING PREPAYMENT PREMIUM AND ANY DISCOUNT ON THE LOANS IN CONNECTION WITH ANY SUCH ACCELERATION. The Borrower expressly agrees that (i) the prepayment premium required by Section 2.03(d) and any discount on the Loans provided for herein is reasonable and is the product of an arm’s length transaction between sophisticated business people, ably represented by counsel, (ii) the prepayment premium required by Section 2.03(d) and any discount on the Loans shall be payable notwithstanding the then prevailing market rates at the time payment is made, (iii) there has been a course of conduct between the Lenders and the Borrower giving specific consideration in this transaction for such agreement to pay the prepayment premium required by Section 2.03(d) and any discount on the Loans and (iv) the Borrower shall be estopped hereafter from claiming differently than as agreed to in this paragraph. The Borrower expressly acknowledges that its agreement to pay the prepayment premium required by Section 2.03(d) and any discount on the Loans to the Lenders as herein described is a material inducement to the Lenders to make the Loans hereunder.

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9.03 Application of Funds.

After the exercise of remedies provided for in Section 9.02 (or after the Loans have automatically become immediately due and payable as set forth in the proviso to Section 9.02 ), any amounts received by any Lender or the Administrative Agent on account of the Obligations shall be applied by the Administrative Agent in the following order:

First , to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and disbursements of counsel to the Administrative Agent and amounts payable under Article III ) payable to the Administrative Agent in its capacity as such;

Second , to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal and interest) payable to the Lenders (including fees, charges and disbursements of counsel to the respective Lenders) arising under the Loan Documents and amounts payable under Article III , ratably among them in proportion to the respective amounts described in this clause Second payable to them;

Third , to payment of that portion of the Obligations constituting accrued and unpaid interest on and prepayment premium with respect to the Loans, ratably among the Lenders in proportion to the respective amounts described in this clause Third held by them;

Fourth , to payment of that portion of the Obligations constituting accrued and unpaid principal of the Loans, ratably among the Secured Parties in proportion to the respective amounts described in this clause Fourth held by them; and

Last , the balance, if any, after all of the Obligations have been indefeasibly paid in full, to the Borrower or as otherwise required by Law.

ARTICLE X.

ADMINISTRATIVE AGENT

10.01 Appointment and Authority.

(a) Each of the Lenders hereby irrevocably appoints Madryn Health Partners, LP to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are incidental thereto. The provisions of this Article X are solely for the benefit of the Administrative Agent and the Lenders, and neither the Borrower nor any other Loan Party shall have rights as a third party beneficiary of any of such provisions. It is understood and agreed that the use of the term “agent” herein or in any other Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable Law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.

(b) The Administrative Agent shall also act as the “collateral agent” under the Loan Documents, and each of the Lenders hereby irrevocably appoints and authorizes the Administrative

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Agent to act as the agent of such Lender for purposes of acquiring, holding and enforcing any and all Liens on Collateral granted by any of the Loan Parties to secure any of the Obligations, together with such powers and discretion as are incidental thereto. In this connection, the Administrative Agent, as “collateral agent” and any co-agents, sub-agents and attorneys-in-fact appointed by the Administrative Agent pursuant to Section 10.05 for purposes of holding or enforcing any Lien on the Collateral (or any portion thereof) granted under the Collateral Documents, or for exercising any rights and remedies thereunder at the direction of the Administrative Agent, shall be entitled to the benefits of all provisions of this Article X and Article XI (including Section 11.04(c) , as though such co-agents, sub-agents and attorneys-in-fact were the “collateral agent” under the Loan Documents) as if set forth in full herein with respect thereto.

10.02 Rights as a Lender.

The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with any Loan Party or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.

10.03 Exculpatory Provisions.

The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents, and its duties hereunder shall be administrative in nature. Without limiting the generality of the foregoing, the Administrative Agent:

(a) shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(b) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents); provided , that , the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may affect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law; and

(c) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to any Loan Party or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.

The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the

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circumstances as provided in Section 11.01 and Section 9.02 ) or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and non-appealable judgment. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given in writing to the Administrative Agent by the Borrower or a Lender.

The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article V or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

10.04 Reliance by Administrative Agent.

The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan, that by its terms must be fulfilled to the satisfaction of a Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender unless the Administrative Agent shall have received notice to the contrary from such Lender prior to the making of such Loan. The Administrative Agent may consult with legal counsel (who may be counsel for the Loan Parties), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

10.05 Delegation of Duties.

The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article X shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the Facilities provided for herein as well as activities as Administrative Agent. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and non-appealable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub-agents.

10.06 Resignation of Administrative Agent.

The Administrative Agent may resign as Administrative Agent at any time by giving thirty (30) days advance notice thereof to the Lenders and the Borrower and, thereafter, the retiring Administrative Agent shall be discharged from its duties and obligations hereunder. Upon any such resignation, the Required Lenders shall have the right, subject to the approval of the Borrower (so long as no Event of Default has occurred and is continuing; such approval not to be unreasonably withheld), to appoint a successor

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Administrative Agent. If no successor Administrative Agent shall have been so appointed by the Required Lenders, been approved (so long as no Event of Default has occurred and is continuing) by the Borrower or have accepted such appointment within thirty (30) days after the Administrative Agent’s giving of notice of resignation, then the Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent reasonably acceptable to the Borrower (so long as no Default or Event of Default has occurred and is continuing). Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to and become vested with all rights, powers, privileges and duties of the retiring Administrative Agent. After any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the provisions of this Section 10.06 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as Administrative Agent. If no successor has accepted appointment as Administrative Agent by the date which is thirty (30) days following a retiring Administrative Agent’s notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless thereupon become effective and the Required Lenders shall perform all of the duties of the Administrative Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above.

10.07 Non-Reliance on Administrative Agent and Other Lenders.

Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

10.08 Administrative Agent May File Proofs of Claim.

In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise:

(a) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders and the Administrative Agent under Section 11.04 ) allowed in such judicial proceeding; and

(b) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the

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Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Section 11.04 .

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

10.09 Collateral and Guaranty Matters.

The Lenders irrevocably authorize the Administrative Agent, at its option and in its discretion,

(a) to release any Lien on any Collateral granted to or held by the Administrative Agent under any Loan Document (i) upon termination of all unused Commitments and payment in full of all Obligations (other than contingent indemnification obligations for which no claim has been asserted), (ii) that is sold or otherwise disposed of or to be sold or otherwise disposed of as part of or in connection with any sale or other Disposition permitted hereunder or under any other Loan Document or any Involuntary Disposition or (iii) as approved in accordance with Section 11.01 ;

(b) to subordinate any Lien on any property granted to or held by the Administrative Agent under any Loan Document to the holder of any Lien on such property that is permitted by Section 8.01(i) ; and

(c) to release any Guarantor from its obligations under the Guaranty if such Person ceases to be a Subsidiary as a result of a transaction permitted under the Loan Documents.

Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s authority to release or subordinate its interest in particular types or items of property, or to release any Guarantor from its obligations under the Guaranty, pursuant to this Section 10.09 .

The Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the Collateral, the existence, priority or perfection of the Administrative Agent’s Lien thereon, or any certificate prepared by any Loan Party in connection therewith, nor shall the Administrative Agent be responsible or liable to the Lenders for any failure to monitor or maintain any portion of the Collateral.

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ARTICLE XI.

MISCELLANEOUS

11.01 Amendments, Etc.

No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by the Borrower or any other Loan Party therefrom, shall be effective unless in writing signed by the Required Lenders and the Borrower or the applicable Loan Party, as the case may be, and acknowledged by the Administrative Agent, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided , further , that :

(a) no such amendment, waiver or consent shall:

(i) extend or increase the Commitment of a Lender (or reinstate any Commitment terminated pursuant to Section 9.02 ) without the written consent of such Lender whose Commitment is being extended or increased (it being understood and agreed that a waiver of any condition precedent set forth in Section 5.03 or of any Default or a mandatory reduction in Commitments is not considered an extension or increase in Commitments of any Lender);

(ii) postpone any date fixed by this Agreement or any other Loan Document for any payment of principal (excluding mandatory prepayments), interest, prepayment premiums, fees or other amounts due to the Lenders (or any of them) or any scheduled or mandatory reduction of the Commitments hereunder or under any other Loan Document without the written consent of each Lender entitled to receive such payment or whose Commitments are to be reduced;

(iii) reduce the principal of, the rate of interest specified herein on or the prepayment premium specified herein on any Loan, or any fees or other amounts payable hereunder or under any other Loan Document without the written consent of each Lender entitled to receive such payment of principal, interest, fees or other amounts; provided , however , that , only the consent of the Required Lenders shall be necessary to amend the definition of “Default Rate” or to waive any obligation of the Borrower to pay interest at the Default Rate;

(iv) change any provision of this Section 11.01(a) or the definition of “Required Lenders” without the written consent of each Lender directly affected thereby;

(v) except in connection with a Disposition permitted under Section 8.05 , release all or substantially all of the Collateral without the written consent of each Lender directly affected thereby;

(vi) release the Borrower or, except in connection with a merger or consolidation permitted under Section 8.04 or a Disposition permitted under Section 8.05 , all or substantially all of the Guarantors without the written consent of each Lender directly affected thereby, except to the extent the release of any Guarantor is permitted pursuant to Section 10.09 (in which case such release may be made by the Administrative Agent acting alone); and

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(b) unless also signed by the Administrative Agent, no amendment, waiver or consent shall affect the rights or duties of the Administrative Agent under this Agreement or any other Loan Document;

provided , however , that , notwithstanding anything to the contrary herein, (i) no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitments of any Defaulting Lender may not be increased or extended without the consent of such Lender and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender more adversely than other affected Lenders shall require the consent of such Defaulting Lender, (ii) each Lender is entitled to vote as such Lender sees fit on any bankruptcy reorganization plan that affects the Loans and each Lender acknowledges that the provisions of Section 1126(c) of the Bankruptcy Code of the United States supersedes the unanimous consent provisions set forth herein and (iii) the Required Lenders shall determine whether or not to allow a Loan Party to use cash collateral in the context of a bankruptcy or insolvency proceeding and such determination shall be binding on all of the Lenders. Notwithstanding anything to the contrary set forth herein, in order to implement the Term C Facility, this Agreement may be amended for such purpose by the Loan Parties, the Administrative Agent and the Term C Lenders.

It is understood and agreed that, following the Funding Date, subject to the written consent of the Administrative Agent and the Required Lenders (such consent not to be unreasonably withheld or delayed) effectuated in accordance with this Section 11.01 , the Loan Parties shall be permitted to convey the Business IP Rights to a Qualified Loan Party in order to facilitate the Borrower’s intellectual property strategy.

Notwithstanding any provision herein to the contrary, the Administrative Agent and the Borrower may make amendments contemplated by Section 3.05 .

11.02 Notices and Other Communications; Facsimile Copies.

(a) Notices Generally . Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:

(i) if to the Borrower or any other Loan Party or the Administrative Agent, to the address, facsimile number, electronic mail address or telephone number specified for such Person on Schedule 11.02 ; and

(ii) if to any other Lender, to the address, facsimile number, electronic mail address or telephone number of its Lending Office (whether specified on Schedule 11.02 or separately specified to the Borrower and the Administrative Agent).

Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices and other communications sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the recipient). Notices and other communications

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delivered through electronic communications to the extent provided in subsection (b) below, shall be effective as provided in such subsection (b) .

(b) Electronic Communications . Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent; provided , that , the foregoing shall not apply to notices to any Lender pursuant to Article II if such Lender has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. The Administrative Agent or the Borrower may each, in their respective discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided , that , approval of such procedures may be limited to particular notices or communications.

Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement) and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor; provided , that , for both clauses (i) and (ii) , if such notice, email or other communication is not sent during the normal business hours of the recipient, such notice, email or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient.

(c) Change of Address, Etc. Each of the Borrower, the Lenders and the Administrative Agent may change its address, facsimile or telephone number for notices and other communications hereunder by notice to the other parties hereto. In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that the Administrative Agent has on record (i) an effective address, contact name, telephone number, facsimile number and electronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Lender.

(d) Reliance by Administrative Agent and Lenders . The Administrative Agent and the Lenders shall be entitled to rely and act upon any notices (including telephonic or electronic Loan Notices) purportedly given by or on behalf of any Loan Party even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. The Loan Parties shall indemnify the Administrative Agent, each Lender and the Related Parties of each of them from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by or on behalf of a Loan Party. All telephonic notices to and other telephonic communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording.

11.03 No Waiver; Cumulative Remedies; Enforcement.

No failure by any Lender or the Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder or under any other Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege

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hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided, and provided under each other Loan Document, are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents against the Loan Parties or any of them shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent in accordance with Section 10.01 for the benefit of all the Secured Parties; provided , however , that , the foregoing shall not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) any Lender from exercising setoff rights in accordance with Section 11.08 (subject to the terms of Section 2.11 ) or (c) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party under any Debtor Relief Law; and provided , further , that , if at any time there is no Person acting as Administrative Agent hereunder and under the other Loan Documents, then (i) the Required Lenders shall have the rights otherwise ascribed to the Administrative Agent pursuant to Section 10.01 and (ii) in addition to the matters set forth in clauses (b) and (c) of the preceding proviso and subject to Section 2.11 , any Lender may, with the consent of the Required Lenders, enforce any rights and remedies available to it and as authorized by the Required Lenders.

11.04 Expenses; Indemnity; and Damage Waiver.

(a) Costs and Expenses . The Loan Parties shall pay (i) all out-of-pocket expenses incurred by the Administrative Agent and its Affiliates (including the fees, charges and disbursements of one primary counsel and, as reasonably necessary, one local counsel in each relevant jurisdiction for the Administrative Agent and one specialty counsel in each relevant specialty for the Administrative Agent), in connection with the preparation, negotiation, execution, delivery and administration of this Agreement and the other Investment Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated) or the administration of this Agreement and the other Investment Documents and (ii) all out-of-pocket expenses incurred by the Administrative Agent or any Lender (including the fees, charges and disbursements of one primary counsel for the Administrative Agent and the Lenders and, as reasonably necessary, one local counsel for the Administrative Agent and the Lenders in any relevant jurisdiction and one specialty counsel in each relevant specialty for the Administrative Agent and the Lenders (and of such other counsel as necessary in the event of a conflict), and shall pay all fees and time charges for attorneys who may be employees of the Administrative Agent or any Lender, in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Investment Documents, including its rights under this Section 11.04 or (B) in connection with the Loans made hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans.

(b) Indemnification by the Loan Parties . The Loan Parties shall indemnify the Administrative Agent (and any sub-agent thereof) and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “ Indemnitee ”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee), and shall indemnify and hold harmless each Indemnitee from all fees and time charges and disbursements for

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attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by any Person (including the Borrower or any other Loan Party) arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Investment Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, or, in the case of the Administrative Agent (and any sub-agent thereof) and its Related Parties only, the administration of this Agreement and the other Investment Documents, (ii) any Loan or the use or proposed use of the proceeds therefrom, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by a Loan Party or any of its Subsidiaries, or any Environmental Liability related in any way to a Loan Party or any of its Subsidiaries, (iv) any actual or prospective claim, litigation, investigation or proceeding relating to an allegation that the use, advertisement, display, importation, manufacture, marketing, offering for sale, performance, preparation of derivative works based upon, promotion, reproduction, sale, use and/or other distribution of a Product by any Loan Party, any Subsidiary or any of their respective licensees, or the conduct of the Businesses, constitutes the infringement, violation or misappropriation of the rights of any Person or (v) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower or any other Loan Party, and regardless of whether any Indemnitee is a party thereto, in all cases, whether or not caused by or arising, in whole or in part, out of the comparative, contributory or sole negligence of the Indemnitee; provided , that , such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee, if such Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction or (y) arise solely from a dispute between or among Indemnitees and (1) do not involve any action or inaction by any Loan Party or any of their respective Affiliates or (2) do not relate to any action of such Indemnitee in its capacity as the Administrative Agent as determined by a court of competent jurisdiction in a final and nonappealable judgment. This Section 11.04(b) shall not apply with respect to taxes other than any taxes that represent losses, claims, damages, etc. arising from any non-tax claim.

(c) Reimbursement by Lenders . To the extent that the Loan Parties for any reason fail to indefeasibly pay any amount required under subsection (a) or (b) of this Section 11.04 to be paid by them to the Administrative Agent (or any sub-agent thereof) or any Related Party thereof, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent) or such Related Party, as the case may be, such Lender’s pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought based on each Lender’s share of the Total Credit Exposure at such time) of such unpaid amount (including any such unpaid amount in respect of a claim asserted by such Lender), such payment to be made severally among them based on such Lenders’ Applicable Percentages (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought); provided , further , that , the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent), or against any Related Party thereof acting for the Administrative Agent (or any such sub-agent) in connection with such capacity. The obligations of the Lenders under this subsection (c) are subject to the provisions of Section 2.10(b) .

(d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by applicable law, no Loan Party shall assert, and each Loan Party hereby waives, and acknowledges that no other

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Person shall have, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Investment Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof. No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Investment Documents or the transactions contemplated hereby or thereby.

(e) Payments . All amounts due under this Section 11.04 shall be payable not later than ten (10) Business Days after demand therefor.

(f) Survival . The agreements in this Section 11.04 and the indemnity provisions of Section 11.02(d) shall survive the resignation of the Administrative Agent, the replacement of any Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all the other Obligations.

11.05 Payments Set Aside.

To the extent that any payment by or on behalf of any Loan Party is made to the Administrative Agent or any Lender, or the Administrative Agent or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred, and (b) each Lender severally agrees to pay to the Administrative Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of the Lenders under clause (b) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement.

11.06 Successors and Assigns.

(a) Successors and Assigns Generally . The provisions of this Agreement and the other Loan Documents shall be binding upon and inure to the benefit of the parties hereto and thereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of their rights or obligations hereunder or thereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of subsection (b) of this Section 11.06 , (ii) by way of participation in accordance with the provisions of subsection (d) of this Section 11.06 or (iii) by way of pledge or assignment of a security interest subject to the restrictions of subsection (e) of this Section 11.06 (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in subsection (e) of this Section 11.06 and, to the extent expressly contemplated hereby, the Related

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Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b) Assignments by Lenders . Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement and the other Loan Documents (including all or a portion of its Commitments under any Facility and the Loans at the time owing to it (in each case with respect to any Facility)); provided , that , any such assignment shall be subject to the following conditions:

(i) Minimum Amounts .

(A) in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment with respect to any Facility and/or the Loans with respect to any Facility at the time owing to it or contemporaneous assignments to related Approved Funds that equal at least the amount specified in subsection (b)(i)(B) of this Section 11.06 in the aggregate or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and

(B) in any case not described in subsection (b)(i)(A) of this Section 11.06 , the aggregate amount of the applicable Commitment (which for this purpose includes Loans outstanding thereunder) or, if the applicable Commitment is not then in effect, the principal outstanding balance of the Loans with respect to such Facility of the assigning Lender subject to each such assignment, determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date, shall not be less than $1,000,000 unless each of the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed);

(ii) Proportionate Amounts . Each partial assignment shall be made as an assignment of a proportionate part of all of the assigning Lender’s rights and obligations under this Agreement with respect to the Loans or the Commitment assigned.

(iii) Required Consents . No consent shall be required for any assignment except to the extent required by subsection (b)(i)(B) of this Section 11.06 and, in addition:

(A) the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be required unless (1) an Event of Default has occurred and is continuing at the time of such assignment or (2) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided , that , the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within five (5) Business Days after having received notice thereof;

(B) the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments in respect of (i) any unfunded Commitment if such assignment is to a Person that is not a Lender with a Commitment in respect of the applicable Facility, an Affiliate of such Lender

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or an Approved Fund with respect to such Lender or (ii) any Loan to a Person that is not a Lender, an Affiliate of a Lender or an Approved Fund;

(iv) Assignment and Assumption . The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption. The assignee, if it is not a Lender, shall deliver to the Administrative Agent such information, including notice information, as the Administrative Agent shall reasonably require.

(v) No Assignment to Certain Persons . No such assignment shall be made (A) to the Borrower or any of the Borrower’s Affiliates or Subsidiaries, (B) to any Defaulting Lender or any of its Subsidiaries or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (B) or (C) to a natural Person.

(vi) Certain Additional Payments . In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent or any Lender hereunder (and interest accrued thereon) and (y) acquire (and fund as appropriate) its full pro rata share of all Loans in accordance with its Applicable Percentage. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section 11.06 , from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 3.01 , 3.02 , 3.04 and 11.04 with respect to facts and circumstances occurring prior to the effective date of such assignment. Upon request, the Borrower (at its expense) shall execute and deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with subsection (d) of this Section 11.06 .

(c) Register . The Administrative Agent, acting solely for this purpose as an agent of the Borrower (and such agency being solely for tax purposes), shall maintain at the Administrative

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Agent’s Office a copy of each Assignment and Assumption delivered to it (or the equivalent thereof in electronic form) and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts (and stated interest) of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “ Register ”). The entries in the Register shall be conclusive absent manifest error, and the Borrower, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement. In addition, the Administrative Agent shall maintain on the Register information regarding the designation, and revocation of designation, of any Lender as a Defaulting Lender. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

(d) Participations . Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural Person, a Defaulting Lender or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “ Participant ”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided , that , (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. For the avoidance of doubt, each Lender shall be responsible for the indemnity under Section 11.04(c) without regard to the existence of any participation.

Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided , that , such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver or other modification described in clauses (i) through (vi) of Section 11.01(a) that affects such Participant. The Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.01 , 3.02 and 3.04 (subject to the requirements and limitations therein (it being understood that the documentation required under Section 3.01(c) shall be delivered to the participating Lender)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section 11.06 ; provided , that , such Participant (A) agrees to be subject to the provisions of Sections 3.03 and 11.13 as if it were an assignee under paragraph (b) of this Section; and (B) shall not be entitled to receive any greater payment under Section 3.01 or 3.02 , with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. Each Lender that sells a participation agrees, at the Borrower's request and expense, to use reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 11.13 with respect to any Participant. To the fullest extent permitted by law, each Participant also shall be entitled to the benefits of Section 11.08 as though it were a Lender; provided , that , such Participant agrees to be subject to Section 2.11 as though it were a Lender.

(e) Certain Pledges . Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement (including under its Note, if any) to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided , that , no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

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11.07 Treatment of Certain Information; Confidentiality.

Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its Related Parties (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and will be instructed to keep such Information confidential), (b) to the extent required or requested by any regulatory authority purporting to have jurisdiction over such Person or its Related Parties (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party hereto, (e) as may be reasonably necessary in connection with the exercise of any remedies hereunder or under any other Investment Document or any action or proceeding relating to this Agreement or any other Investment Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section 11.07 , to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights and obligations under this Agreement or (ii) any actual or prospective party (or its Related Parties) to any swap, derivative or other transaction under which payments are to be made by reference to a Loan Party and its obligations, this Agreement or payments hereunder, (g) on a confidential basis to (i) any rating agency in connection with rating any Loan Party or its Subsidiaries or the credit facilities provided hereunder or (ii) the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers or other market identifiers with respect to the credit facilities provided hereunder, (h) with the consent of the Borrower, (i) to the members of its investment committee and its limited partners (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential) or (j) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section 11.07 or (y) becomes available to the Administrative Agent, any Lender or any of their respective Affiliates on a nonconfidential basis from a source other than the Borrower.

For purposes of this Section 11.07 , “ Information ” means all information received from a Loan Party or any Subsidiary relating to the Loan Parties or any Subsidiary or any of their respective businesses, other than any such information that is available to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by such Loan Party or any Subsidiary; provided , that , in the case of information received from a Loan Party or any Subsidiary after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section 11.07 shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

11.08 Set-off.

If an Event of Default shall have occurred and be continuing, each Lender and each of their respective Affiliates is hereby authorized at any time and from time to time, after obtaining the prior written consent of the Administrative Agent, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender or any such Affiliate to or for the credit or the account of the Borrower or any other Loan Party against any and all of the obligations of the Borrower or such Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or its Affiliates, irrespective of whether or not such Lender or Affiliate shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Borrower or such Loan Party may be contingent or unmatured or are owed to a branch office or Affiliate of

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such Lender different from the branch office or Affiliate holding such deposit or obligated on such indebtedness; provided , that , in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.12 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender and their respective Affiliates under this Section 11.08 are in addition to other rights and remedies (including other rights of setoff) that such Lender or their respective Affiliates may have. Each Lender agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided , that , the failure to give such notice shall not affect the validity of such setoff and application.

11.09 Interest Rate Limitation.

Notwithstanding anything to the contrary contained in any Investment Document, the interest (actual or deemed) paid or agreed to be paid under the Investment Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “ Maximum Rate ”). If the Administrative Agent or any Lender shall receive interest (including, without limitation, all charges, fees, exactions or other sums which may at any time be deemed to be interest) in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower. In determining whether the interest contracted for, charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

11.10 Counterparts; Integration; Effectiveness.

This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement, the other Investment Documents, and any separate letter agreements with respect to fees payable to the Administrative Agent, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 5.01 , this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic imaging means (e.g. “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this Agreement.

11.11 Survival of Representations and Warranties.

All representations and warranties made hereunder and in any other Investment Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof and shall continue in full force and effect as long as any Loan or other Obligation hereunder shall remain unpaid or unsatisfied. Such representations and warranties have been or will be relied upon by the Administrative Agent and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or on their behalf and notwithstanding that the

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Administrative Agent or any Lender may have had notice or knowledge of any Default at the time of any Borrowing, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied.

11.12 Severability.

If any provision of this Agreement or the other Investment Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Investment Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Without limiting the foregoing provisions of this Section 11.12 , if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief Laws, as determined in good faith by the Administrative Agent, then such provisions shall be deemed to be in effect only to the extent not so limited.

11.13 Replacement of Lenders.

If the Borrower is entitled to replace a Lender pursuant to the provisions of Section 3.03 , or if any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 11.06 ), all of its interests, rights (other than its existing rights to payments pursuant to Sections 3.01 and 3.02 ) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), provided , that :

(a) such Lender shall have received payment of an amount equal to one hundred percent (100%) of (x) the outstanding principal of its Loans, accrued interest thereon and all other amounts payable to it hereunder and under the other Loan Documents (other than prepayment premium) from the assignee (to the extent of such outstanding principal and accrued interest) or the Borrower (in the case of all other amounts) and (y) the prepayment premium required by Section 2.03(d) from the Borrower, as if such assignment was a prepayment of one hundred percent (100%) of the outstanding principal amount of such assignor’s Loans on the effective date of such assignment;

(b) in the case of any such assignment resulting from a claim for compensation under Section 3.02 or payments required to be made pursuant to Section 3.01 , such assignment will result in a reduction in such compensation or payments thereafter;

(d) in the case of any such assignment resulting from a Non-Consenting Lender’s failure to consent to a proposed change, waiver, discharge or termination with respect to any Loan Document, the applicable replacement bank, financial institution or Fund consents to the proposed change, waiver, discharge or termination; provided , that , the failure by such Non-Consenting Lender to execute and deliver an Assignment and Assumption shall not impair the validity of the removal of such Non-Consenting Lender and the mandatory assignment of such Non-Consenting Lender’s Commitments and outstanding Loans pursuant to this Section 11.13 shall nevertheless be effective without the execution by such Non-Consenting Lender of an Assignment and Assumption.

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A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

11.14 Governing Law; Jurisdiction; Etc.

(a) GOVERNING LAW . THIS AGREEMENT AND THE OTHER INVESTMENT DOCUMENTS (EXCEPT, AS TO ANY OTHER INVESTMENT DOCUMENT, AS EXPRESSLY SET FORTH THEREIN) AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER INVESTMENT DOCUMENT (EXCEPT, AS TO ANY OTHER INVESTMENT DOCUMENT, AS EXPRESSLY SET FORTH THEREIN) AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

(b) SUBMISSION TO JURISDICTION . THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER OR ANY RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS AGREEMENT OR ANY OTHER INVESTMENT DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY OTHER FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK AND ANY UNITED STATES DISTRICT COURT IN THE STATE OF NEW YORK, IN EACH CASE LOCATED IN NEW YORK COUNTY, NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER INVESTMENT DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER INVESTMENT DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c) WAIVER OF VENUE . THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER INVESTMENT DOCUMENT IN ANY COURT REFERRED TO IN SUBSECTION (B) OF THIS SECTION 11.14 . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT

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FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

(d) SERVICE OF PROCESS . EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 11.02 . NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

11.15 Waiver of Right to Trial by Jury.

EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER INVESTMENT DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER INVESTMENT DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 11.15 .

11.16 Electronic Execution of Assignments and Certain Other Documents.

The words “execute,” “execution,” “signed,” “signature” and words of like import in any Assignment and Assumption or in any amendment or other modification hereof (including waivers and consents) shall be deemed to include electronic signatures, the electronic matching of assignment terms and contract formations on electronic platforms approved by the Administrative Agent, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

11.17 USA PATRIOT Act.

Each Lender that is subject to the Act (as hereinafter defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Loan Parties that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “ Act ”), it is required to obtain, verify and record information that identifies the Loan Parties, which information includes the name and address of the Loan Parties, information concerning its direct and indirect holders of Equity Interests and other Persons exercising Control over it, and its and their respective directors and officers, and other information that will allow such Lender or the Administrative Agent, as applicable, to identify the Loan Parties in accordance with the Act. The Loan Parties shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that the Administrative Agent or such Lender reasonably requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering laws, rules and regulations, including the Act.

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11.18 No Advisory or Fiduciary Relationship.

In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Investment Document), each Loan Party acknowledges and agrees, and acknowledges its Affiliates’ understanding, that: (a)(i) the arranging and other services regarding this Agreement provided by the Administrative Agent and the Lenders are arm’s-length commercial transactions between the Loan Parties and their Affiliates, on the one hand, and the Administrative Agent, the Lenders and their respective Affiliates on the other hand, (ii) the Loan Parties have consulted their own legal, accounting, regulatory and tax advisors to the extent they have deemed appropriate and (iii) each Loan Party is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Investment Documents; (b)(i) the Administrative Agent, each Lender and each of their respective Affiliates is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not and will not be acting as an advisor, agent or fiduciary for any Loan Party or any Loan Party’s Affiliates or any other Person and (ii) neither the Administrative Agent, any Lender nor any of their respective Affiliates has any obligation to the Loan Parties or any of their Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Investment Documents; and (c) the Administrative Agent, the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Loan Parties and their Affiliates, and neither the Administrative Agent nor any Lender nor any of their respective Affiliates has any obligation to disclose any of such interests to the Loan Parties or their Affiliates. To the fullest extent permitted by law, the Loan Parties hereby waive and release any claims that they may have against the Administrative Agent, any Lender or any of their respective Affiliates with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

11.19 Acknowledgement and Consent to Bail-In of EEA Financial Institutions.

Solely to the extent any Lender that is an EEA Financial Institution is a party to this Agreement and notwithstanding anything to the contrary in any Investment Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Lender that is an EEA Financial Institution arising under any Investment Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any Lender that is an EEA Financial Institution; and

(b) the effects of any Bail-In Action on any such liability, including, if applicable:

(i) a reduction in full or in part or cancellation of any such liability;

(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Investment Document; or

(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.

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11.20 Funding Date.

The parties hereto agree that if the Funding Date does not occur on or before August 24, 2017, this Agreement and all other Loan Documents shall be automatically terminated.

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SCHEDULE 2

EXHIBIT E TO AMENDED CREDIT AGREEMENT

See Attached.

EXHIBIT E

FORM OF COMPLIANCE CERTIFICATE

Financial Statement Date:[_________, 20___]


To:	Madryn Health Partners, LP, as Administrative Agent

Re:

Credit Agreement dated as of August 24, 2017 (as amended, modified, restated, supplemented or extended from time to time, the “Credit Agreement”), among Establishment Labs Holdings Inc., a BVI business company, limited by shares and incorporated under the laws of the British Virgin Islands (the “Borrower”), the Guarantors from time to time party thereto, the Lenders from time to time party thereto and Madryn Health Partners, LP, as Administrative Agent. Capitalized terms used but not otherwise defined herein have the meanings provided in the Credit Agreement.

Date: [_________, 20___]

Ladies and Gentlemen:

The undersigned Responsible Officer hereby certifies as of the date hereof that [he/she] is the [Chief Executive Officer, Chief Financial Officer, Treasurer or Controller] of the Borrower, and that, in [his/her] capacity as such, [he/she] is authorized to execute and deliver this Compliance Certificate to the Administrative Agent on the behalf of the Borrower, and that:

[Use following paragraph 1 for financial statements delivered pursuant to Section 7.01(a) of the Credit Agreement:]

[1. [Attached hereto as Schedule 1 are the year-end audited financial statements of the Borrower and its Subsidiaries, together with the report and opinion of an independent certified public accountant in satisfaction of their requirements under Section 7.01(a) of the Credit Agreement for the fiscal year of the Borrower ended as of the Financial Statement Date.]

[Use following paragraph 1 for financial statements delivered pursuant to Section 7.01(b) of the Credit Agreement:]

[1. [Attached hereto as Schedule 1 are the unaudited financial statements of the Borrower and its Subsidiaries in satisfaction of their requirements under Section 7.01(b) of the Credit Agreement for the fiscal quarter of the Borrower ended as of the Financial Statement Date. Such financial statements fairly present in all material respects the financial condition, results of operations, shareholders’ equity and cash flows of the Borrower and its Subsidiaries in accordance with GAAP as at such date and for such period, subject only to normal year end audit adjustments and the absence of footnotes.]

2. The undersigned has reviewed and is familiar with the terms of the Credit Agreement and has made, or has caused to be made, a reasonably detailed review of the transactions and condition (financial or otherwise) of the Loan Parties during the accounting period covered by such financial statements.

3. A review of the activities of the Loan Parties and their respective Subsidiaries during the accounting period covered by such financial statements has been made under the supervision of the undersigned with a view to determining whether during such fiscal period the Loan Parties and their respective Subsidiaries performed and observed all of their respective obligations under the Loan Documents, and

[select one:]

[to the knowledge of the undersigned during such fiscal period, the Loan Parties and their respective Subsidiaries performed and observed each covenant and condition of the Loan Documents applicable to them, and no Default has occurred and is continuing.]

[or:]

[the following covenants or conditions have not been performed or observed and the following is a list of each such Default and its nature and status:]

4. The financial covenant analyses and calculation of (i) Product Revenues for the four consecutive fiscal quarter period most recently ended on or prior to the date of this Compliance Certificate and (ii) Liquidity, in each case, set forth on Schedule 2 attached hereto are true and accurate on and as of the date of this Compliance Certificate.

5. Attached hereto as Schedule 3 is a supplement setting forth information regarding the amount and timing of all Dispositions, Involuntary Dispositions, Debt Issuances, Extraordinary Receipts and Acquisitions that occurred during the period covered by the attached financial statements.

6. Attached hereto as Schedule 4 is a list of (i) all applications by any Loan Party, if any, for Copyrights, Patents or Trademarks made since [the Effective Date] [the date of the prior Compliance Certificate], (ii) all issuances of registrations or letters on existing applications by any Loan Party for Copyrights, Patents and Trademarks received since [the Effective Date] [the date of the prior Compliance Certificate], (iii) licenses of any IP Rights (other than non-exclusive licenses permitted by Section 8.05 of the Credit Agreement granted in the ordinary course of business) entered into by any Loan Party since [the Effective Date] [the date of the prior Compliance Certificate] and (iv) such supplements to Schedules 6.17(a) , 6.17(b) , 6.17(d) and 6.17(e) of the Disclosure Letter as are necessary to cause such schedules to be true and complete in all material respects as of the date of this Compliance Certificate.

7. Attached hereto as Schedule 5 is the insurance binder or other evidence of insurance for any insurance coverage of any Loan Party or any Subsidiary that was renewed, replaced or modified during the period covered by the attached financial statements.

8. Attached hereto as Schedule 6 is a copy of management’s discussion and analysis with respect to such financial statements.

9. Attached hereto as Schedule 7 is a list of all litigations, arbitrations or governmental investigations or proceedings which were instituted during the period covered by such financial statements or which, to the knowledge of any Loan Party, are threatened (in writing) against any Loan Party or any Subsidiary which, in any case, could reasonably be expected to result in losses and/or expenses (other than, for the avoidance of doubt, legal and court fees, costs and expenses) in excess of the Threshold Amount, together with a description setting forth the details thereof and stating what action the applicable Loan Party or Subsidiary has taken and proposes to take with respect thereto.

10. Attached hereto as Schedule 8 is information regarding, in each case, to the extent occurring during the period covered by such financial statements, (i) the termination of any Material Contract, (ii) the receipt by any Loan Party or any of its Subsidiaries of any notice under any Material Contract (and a copy thereof) as to the occurrence of any material breach or default under or pursuant to such Material Contract that could result in termination thereof or a material liability in respect thereof, (iii) the entering into of any new Material

Contract by a Loan Party or any of its Subsidiaries (and a copy thereof) or (iv) any material amendment to a Material Contract (and a copy thereof).

11. Attached hereto as Schedule 9 is a listing of all deposit accounts and other bank accounts and securities accounts of the Loan Parties and their Subsidiaries (including, for the avoidance of doubt, the Controlled Accounts) as of the Financial Statement Date (which listing shall include the location of each such account and the balance of each such account as of the Financial Statement Date).

12. Attached hereto as Schedule 10 is a listing of all Investments made by any Loan Party or any Subsidiary thereof pursuant to Section 8.02(c)(ii) of the Credit Agreement as of the Financial Statement Date.

[SIGNATURE PAGES FOLLOW]

IN WITNESS WHEREOF, the undersigned has executed this Compliance Certificate as of _________, 20___.



ESTABLISHMENT LABS HOLDINGS INC., a BVI business company, limited by shares and incorporated under the laws of the British Virgin Islands

By:
Name:
Title:

Schedule 1

[Audited][Unaudited] Financial Statements of the Borrower and its Subsidiaries

Schedule 2

1 . Product Revenues.



A. For the four fiscal quarter period most recently ended as of the date of this Compliance Certificate, all amounts paid to and received by the Borrower and its Subsidiaries in the ordinary course of business that, in accordance with GAAP, would be classified as net revenue, excluding upfront payments, milestones, royalties and other similar one-time payments received by the Borrower and its Subsidiaries that are not related to the sale of products or services ¹ :	$
B. Minimum amount required by Section 8.16 of the Credit Agreement for such period:	$
Compliance:		[Yes] [No]

2. Liquidity.



A. Aggregate Unrestricted Cash maintained by the Loan Parties (without duplication) for each day during the four fiscal quarter period most recently ended as of the date of this Compliance Certificate and for which the Administrative Agent has received a Qualifying Control Agreement:	$
B. Minimum amount required by Section 8.17 of the Credit Agreement:	$	4,000,000
Compliance:		[Yes] [No]

^{___________________________________________}

¹ “Product Revenues” shall exclude the revenues generated by any Subsidiary to the extent that the declaration or payment of dividends or similar distributions by that Subsidiary of the income resulting from such revenue is not at the time permitted by operation of the terms of itsOrganization Documents or any agreement, instrument, judgment, decree, order, statute, rule, or governmental regulation applicable to that Subsidiary.

Schedule 3

Dispositions, Involuntary Dispositions, Debt Issuances Extraordinary Receipts and Acquisitions

Schedule 4

IP Schedule Updates

Schedule 5

Insurance Binders

Schedule 6

Management's Discussion and Analysis

Schedule 7

Litigations, Arbitrations, or Governmental Investigations or Proceedings

Schedule 8

Material Contracts

Schedule 9

Listing of Deposit Accounts, Other Bank Accounts and Securities Accounts

Schedule 10

Listing of Investments in Brazilian Loan Parties

Exhibit 4.4

U.S. SECURITY AGREEMENT

THIS U.S. SECURITY AGREEMENT dated as of August 24, 2017 (as amended, modified, restated or supplemented from time to time, this “ Security Agreement ”) is by and among the parties identified as “Grantors” on the signature pages hereto and such other parties as may become Grantors hereunder after the date hereof (individually a “ Grantor ”, and collectively the “ Grantors ”) and Madryn Health Partners, LP, as administrative agent (in such capacity, the “ Administrative Agent ”) for the Secured Parties.

W I T N E S S E T H

WHEREAS , a credit facility has been established in favor of Establishment Labs Holdings Inc., a BVI business company, limited by shares and incorporated under the laws of the British Virgin Islands (the “ Borrower ”), pursuant to the terms of that certain Credit Agreement dated as of August 24, 2017 (as amended, modified, restated, supplemented or extended from time to time, the “ Credit Agreement ”) among the Borrower, the Guarantors, the Lenders from time to time party thereto and the Administrative Agent;

WHEREAS , it is required under the terms of the Credit Agreement that the Grantors shall have granted the security interests and undertaken the obligations contemplated by this Security Agreement; and

WHEREAS , this Security Agreement is required under the terms of the Credit Agreement.

NOW, THEREFORE , in consideration of these premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:


1.	Definitions .

(a) Capitalized terms used and not otherwise defined herein shall have the meanings provided in the Credit Agreement.

(b) As used herein, the following terms shall have the meanings assigned thereto in the UCC (defined below): Accession, Account, As-Extracted Collateral, Chattel Paper, Commercial Tort Claim, Consumer Goods, Deposit Account, Document, Electronic Chattel Paper, Equipment, Farm Products, Fixtures, General Intangible, Goods, Instrument, Inventory, Investment Property, Letter-of-Credit Right, Manufactured Home, Money, Payment Intangibles, Proceeds, Securities Account, Securities Intermediary, Security Entitlement, Software, Standing Timber, Supporting Obligation and Tangible Chattel Paper.

“ Administrative Agent ” has the meaning provided in the introductory paragraph hereof.

“ Borrower ” has the meaning provided in the recitals hereof.

“ BVI Act ” means the BVI Business Companies Act, 2004, as amended.

“ Collateral ” has the meaning provided in Section 2 hereof.

“ Credit Agreement ” has the meaning provided in the recitals hereof.

“ Grantor ” and “ Grantors ” have the respective meanings provided in the introductory paragraph hereof.

“ Secured Obligations ” means, without duplication, (i) all Obligations and (ii) all costs and expenses incurred in connection with enforcement and collection of the Obligations, including the fees, charges and disbursements of counsel.

“ Security Agreement ” has the meaning provided in the introductory paragraph hereof.

“ UCC ” means the Uniform Commercial Code as in effect from time to time in the State of New York except as such term may be used in connection with the perfection of the Collateral and then the applicable jurisdiction with respect to such affected Collateral shall apply.

2. Grant of Security Interest in the Collateral . To secure the prompt payment and performance in full when due, whether by lapse of time, acceleration, mandatory prepayment or otherwise, of the Secured Obligations, each Grantor hereby grants to the Administrative Agent, for the benefit of the Secured Parties, a continuing security interest in any and all right, title and interest of such Grantor in and to all of the following, whether now owned, licensed or existing or owned, licensed, acquired or arising hereafter (collectively, the “ Collateral ”):

(a) all Accounts;

(b) all Chattel Paper;

(d) all Copyrights;

(e) all Deposit Accounts;

(f) all Documents;

(g) all Device Clearance Applications;

(h) all Equipment;

(i) all Fixtures;

(j) all General Intangibles;

(k) all Goods;

(l) all Governmental Approvals;

(m) all Instruments;

(n) all Inventory;

(o) all Investment Property;

(p) all IP Rights and licenses thereto;

(q) all Letter-of-Credit Rights;

(r) all Money;

(s) all Patents;

(t) all Payment Intangibles;

(u) all Product Agreements;

(v) all Product Authorizations;

(w) all Regulatory Approvals;

(x) all Software;

(y) all Supporting Obligations;

(z) all Trademarks;

(aa) Technical Information; and

(bb) all Accessions and all Proceeds of any and all of the foregoing.

Notwithstanding anything to the contrary contained herein, the security interests granted under this Security Agreement shall not extend to (x) any Excluded Property or (y) any Pledged Collateral (as defined in any U.S. Pledge Agreement).

The Grantors and the Administrative Agent, on behalf of the Secured Parties, hereby acknowledge and agree that the security interest created hereby in the Collateral (i) constitutes continuing collateral security for all of the Secured Obligations, whether now existing or hereafter arising and (ii) is not and shall not be construed as an assignment of any IP Rights.

3. Provisions Relating to Accounts .

(a) Anything herein to the contrary notwithstanding, each of the Grantors shall remain liable under each of the Accounts to observe and perform all the conditions and obligations to be observed and performed by it thereunder, all in accordance with the terms of any agreement giving rise to each such Account. Neither the Administrative Agent nor any Secured Party shall have any obligation or liability under any Account (or any agreement giving rise thereto) by reason of or arising out of this Security Agreement or the receipt by the Administrative Agent or any Secured Party of any payment relating to such Account pursuant hereto, nor shall the Administrative Agent or any Secured Party be obligated in any manner to perform any of the obligations of a Grantor

under or pursuant to any Account (or any agreement giving rise thereto), to make any payment, to make any inquiry as to the nature or the sufficiency of any payment received by it or as to the sufficiency of any performance by any party under any Account (or any agreement giving rise thereto), to present or file any claim, to take any action to enforce any performance or to collect the payment of any amounts that may have been assigned to it or to which it may be entitled at any time or times.

(b) At any time upon the occurrence of an Event of Default and during the continuation thereof, (i) the Administrative Agent shall have the right, but not the obligation, to make test verifications of the Accounts in any manner and through any medium that it reasonably considers advisable, and the Grantors shall furnish all such assistance and information as the Administrative Agent may reasonably require in connection with such test verifications, (ii) upon the Administrative Agent’s request and at the expense of the Grantors, the Grantors shall cause independent public accountants or others satisfactory to the Administrative Agent to furnish to the Administrative Agent reports showing reconciliations, aging and test verifications of, and trial balances for, the Accounts and (iii) the Administrative Agent in its own name or in the name of others may communicate with account debtors on the Accounts to verify with them to the Administrative Agent’s satisfaction the existence, amount and terms of any Accounts.

4. Representations and Warranties . Each Grantor hereby represents and warrants to the Administrative Agent, for the benefit of the Secured Parties, that:

(a) Ownership . Such Grantor is the legal and beneficial owner of, or has rights to use, its Collateral and has the right to pledge, sell, assign or transfer the same.

(b) Security Interest/Priority . This Security Agreement creates a valid security interest in favor of the Administrative Agent, for the benefit of the Secured Parties, in the Collateral of such Grantor and, when properly perfected by the filing of a UCC financing statement or other evidence of the interests granted herein with appropriate Governmental Authorities, shall constitute a valid, perfected, first priority (subject only to Permitted Liens) security interest in such Collateral, to the extent such security interest can be perfected by filing a financing statement under the UCC or other evidence, free and clear of all Liens except for Permitted Liens. With respect to any Collateral consisting of a Deposit Account, Security Entitlement or held in a Securities Account, upon execution and delivery by the applicable Grantor, the applicable depository bank or Securities Intermediary and the Administrative Agent of an agreement granting control to the Administrative Agent over such Collateral, the Administrative Agent shall have a valid and perfected, first priority security interest in such Collateral.

(c) Types of Collateral . None of the Collateral consists of, or is the Accessions or the Proceeds of, As-Extracted Collateral, Consumer Goods, Farm Products, Manufactured Homes or Standing Timber.

(d) Accounts . (i) Each Account of such Grantor and the papers and documents relating thereto are genuine and in all material respects accurate and what they purport to be, (ii) each Account arises out of (A) a bona fide sale of goods sold and delivered by such Grantor (or in the process of being delivered) or (B) services theretofore actually rendered by such Grantor to the account debtor named therein, (iii) no Account of such Grantor is evidenced by any Instrument or Chattel Paper unless such Instrument or Chattel Paper, to the extent requested by the Administrative Agent pursuant to Section 5(b) , has been endorsed over and delivered to, or submitted to the control of, the

Administrative Agent, (iv) no surety bond was required or given in connection with any Account of such Grantor or the contracts or purchase orders out of which they arose and (v) the right to receive payment under each Account is assignable.

(e) Equipment and Inventory . With respect to any Equipment and/or Inventory of a Grantor, each such Grantor has exclusive possession and control of such Equipment and Inventory except for (i) Equipment leased by such Grantor as a lessee, (ii) Equipment or Inventory in transit with common carriers or out for repair in the ordinary course of business and (iii) Equipment in the possession of such Grantor’s employees or consultants in the ordinary course of business. No Inventory of such Grantor is held by a Person other than a Grantor pursuant to consignment, sale or return, sale on approval or similar arrangement.

(f) No Other Instruments, Etc. As of the Funding Date, such Grantor does not hold any Instruments, Documents or Tangible Chattel Paper required to be pledged and delivered to the Administrative Agent pursuant to Section 5(b) of this Security Agreement other than as set forth on Schedule 4(f) hereto. All such Instruments, Documents and Tangible Chattel Paper have been delivered to the Administrative Agent.

(g) Consents; Etc. Except for (i) the filing or recording of UCC financing statements, (ii) the filing of appropriate notices with the United States Patent and Trademark Office and the United States Copyright Office, (iii) obtaining control to perfect the Liens created by this Security Agreement (to the extent required under Section 5(b) and Section 5(d) hereof) and (iv) consents, authorizations, filings or other actions which have been obtained or made, no consent or authorization of, filing with, or other act by or in respect of, any arbitrator or Governmental Authority and no consent of any other Person (including, without limitation, any stockholder, member or creditor of such Grantor), is required for (A) the grant by such Grantor of the security interest in the Collateral granted hereby or for the execution, delivery or performance of this Security Agreement by such Grantor, (B) the perfection of such security interest (to the extent such security interest can be perfected by filing under the UCC, the granting of control (to the extent required under Section 5(b) and Section 5(d) hereof) or by filing an appropriate notice with the United States Patent and Trademark Office or the United States Copyright Office) or (C) other than with respect to the licenses set forth on Schedule 4(g) , the exercise by the Administrative Agent or the Secured Parties of the rights and remedies provided for in this Security Agreement.

(h) Commercial Tort Claims . Such Grantor has no Commercial Tort Claims having a potential value in excess of $250,000 other than those listed on Schedule 2(c) or disclosed to the Administrative Agent pursuant to Section 5(h) .

5. Covenants . Each Grantor covenants that, so long as any of the Secured Obligations (other than contingent indemnification obligations for which no claim has been asserted) remains outstanding and until all of the Commitments relating thereto have been terminated, such Grantor shall:

(a) Other Liens . Defend the Collateral against Liens thereon other than Permitted Liens.

(b) Instruments/Tangible Chattel Paper/Documents . If any amount in excess of $250,000 payable under or in connection with any of the Collateral shall be or become evidenced by any Instrument or Tangible Chattel Paper, or if any property constituting Collateral shall be stored or shipped subject to a Document, ensure that such Instrument, Tangible Chattel Paper or Document is either in the possession of such Grantor at all times or, if requested by the Administrative Agent

to perfect its security interest in such Collateral, is delivered to the Administrative Agent, duly endorsed in a manner satisfactory to the Administrative Agent. Such Grantor shall ensure that any Collateral consisting of Tangible Chattel Paper is marked with a legend acceptable to the Administrative Agent indicating the Administrative Agent’s security interest in such Tangible Chattel Paper.

(c) Perfection of Security Interest . Execute and deliver to the Administrative Agent such agreements, assignments or instruments (including affidavits, notices, reaffirmations and amendments and restatements of existing documents, as the Administrative Agent shall reasonably request) and do all such other things as the Administrative Agent may reasonably deem necessary, appropriate or convenient (i) to assure to the Administrative Agent the effectiveness, perfection and priority of its security interests in the Collateral hereunder, including (A) such instruments as the Administrative Agent may from time to time reasonably request in order to perfect and maintain the security interests granted hereunder in accordance with the UCC, (B) with regard to Copyrights and any licenses associated therewith, a Notice of Grant of Security Interest in Copyrights for filing with the United States Copyright Office in the form of Exhibit 5(c)(i) attached hereto, (C) with regard to Patents and any licenses associated therewith, a Notice of Grant of Security Interest in Patents for filing with the United States Patent and Trademark Office in the form of Exhibit 5(c)(ii) attached hereto and (D) with regard to Trademarks registered with the United States Patent and Trademark Office and all applications for Trademarks filed with the United States Patent and Trademark Office and any licenses associated therewith, a Notice of Grant of Security Interest in Trademarks for filing with the United States Patent and Trademark Office in the form of Exhibit 5(c)(iii) attached hereto, (ii) to consummate the transactions contemplated hereby and (iii) to otherwise protect and assure the Administrative Agent of its rights and interests hereunder. To that end, each Grantor authorizes the Administrative Agent to file one or more financing statements (including authorization to describe the Collateral as “all assets” or words of similar meaning) disclosing the Administrative Agent’s security interest in any or all of the Collateral of such Grantor without such Grantor’s signature thereon, and further each Grantor also hereby irrevocably makes, constitutes and appoints the Administrative Agent, its nominee or any other Person whom the Administrative Agent may designate, as such Grantor’s attorney-in-fact with full power and for the limited purpose to sign in the name of such Grantor any such financing statements (including renewal statements), amendments and supplements, notices or any similar documents that in the Administrative Agent’s reasonable discretion would be necessary, appropriate or convenient in order to perfect and maintain perfection of the security interests granted hereunder, such power, being coupled with an interest, being and remaining irrevocable so long as the Secured Obligations (other than contingent indemnification obligations for which no claim has been asserted) remain unpaid and until the Commitments relating thereto shall have been terminated. Each Grantor hereby agrees that a carbon, photographic or other reproduction of this Security Agreement or any such financing statement is sufficient for filing as a financing statement by the Administrative Agent without notice thereof to such Grantor wherever the Administrative Agent may in its sole discretion desire to file the same. In the event for any reason the law of any jurisdiction other than New York becomes or is applicable to the Collateral of any Grantor or any part thereof, or to any of the Secured Obligations, such Grantor agrees to execute and deliver all such instruments and to do all such other things as the Administrative Agent in its sole discretion reasonably deems necessary, appropriate or convenient to preserve, protect and enforce the security interests of the Administrative Agent under the law of such other jurisdiction (and, if a Grantor shall fail to do so promptly upon the request of the Administrative Agent, then the Administrative Agent may execute any and all such requested documents on behalf of such Grantor pursuant to the power of attorney granted hereinabove). If any Collateral is in the possession or control of a Grantor’s agents and the Administrative Agent so reasonably requests, such Grantor

agrees to notify such agents in writing of the Administrative Agent’s security interest therein and, upon the Administrative Agent’s request, instruct them to hold all such Collateral for the account of the Secured Parties, subject to the Administrative Agent’s instructions. Each Grantor agrees to mark its books and records to reflect the security interest of the Administrative Agent in the Collateral.

(d) Control . Execute and deliver (and cause to be executed and delivered) all agreements, assignments, instruments or other documents as the Administrative Agent shall reasonably request for the purpose of obtaining and maintaining control within the meaning of the UCC with respect to any Collateral consisting of Deposit Accounts, Investment Property, Letter-of-Credit Rights and Electronic Chattel Paper.

(e) Collateral held by Warehouseman, Bailee, etc . If any Collateral with a value greater than $250,000 is at any time in the possession or control of a warehouseman, bailee, agent or processor of such Grantor and is expected to remain in possession and control of such third party, (i) notify the Administrative Agent of such possession or control and (ii) upon the Administrative Agent’s request, (A) notify such Person of the Administrative Agent’s security interest in such Collateral, (B) instruct such Person to hold all such Collateral for the Administrative Agent’s account and subject to the Administrative Agent’s instructions and (C) use commercially reasonable efforts to obtain an acknowledgment from such Person that it is holding such Collateral for the benefit of the Administrative Agent.

(f) Treatment of Accounts . Not grant or extend the time for payment of any Account, or compromise or settle any Account for less than the full amount thereof, or release any Person or property, in whole or in part, from payment thereof, or allow any credit or discount thereon, in each case other than as normal and customary in the ordinary course of a Grantor’s business or as required by law.

(g) Insurance . Insure, repair and replace the Collateral of such Grantor as set forth in the Credit Agreement. All insurance proceeds shall be subject to the security interest of the Administrative Agent hereunder.

(h) Commercial Tort Claims .

(i) Promptly notify the Administrative Agent in writing of the initiation of any Commercial Tort Claim seeking monetary damages in excess of $250,000 before any Governmental Authority by or in favor of such Grantor.

(ii) Execute and deliver such statements, documents and notices and do and cause to be done all such things as the Administrative Agent may reasonably deem necessary, appropriate or convenient, or as are required by law, to create, preserve, perfect and maintain the Administrative Agent’s security interest in any Commercial Tort Claim.

(i) Nature of Collateral . At all times maintain the Collateral as personal property and not affix any of the Collateral to any real property in a manner which would change its nature from personal property to real property or a Fixture to real property, unless the Administrative Agent shall have a perfected Lien on such Fixture or real property.

(j) Collateral Access Agreements . For any real property leased by such Grantor that is subject to a Collateral Access Agreement in favor of the Administrative Agent, (i) promptly notify

the Administrative Agent following a change in the identity of the lessor and (ii) use commercially reasonable efforts to obtain such replacement or new Collateral Access Agreements for such real property as the Administrative Agent may reasonably request as a result of such change in the identity of the lessor.

(k) Negative Pledge . Not, without the prior written consent of the Administrative Agent, create or permit to exist any mortgage, charge (whether fixed or floating, legal or equitable), pledge, lien, assignment by way of security, or other security interest, in each case, over any of the Collateral securing any obligation of any Person or other agreement or arrangement that has a similar effect (in each case, other than Permitted Liens).

(l) BVI Registrations . If such Grantor is a BVI Loan Party, within three (3) Business Days after the date of this Security Agreement:

(i) Enter particulars as required by the BVI Act of the security interests created pursuant to this Security Agreement in its Register of Charges required to be maintained pursuant to the BVI Act and immediately after entry of such particulars has been made, provide the Administrative Agent with a certified true copy of the updated Register of Charges; and

(ii) Effect registration, or assist the Administrative Agent in effecting registration, of this Security Agreement with the Registrar of Corporate Affairs pursuant to section 163 of the BVI Act by making the required filing, or assisting the Administrative Agent in making the required filing, in the approved form with the Registrar of Corporate Affairs and (if applicable) provide confirmation in writing to the Administrative Agent that such filing has been made.

6. Covenants Relating to IP Collateral . Each Grantor covenants that, so long as any of the Secured Obligations (other than contingent indemnification obligations for which no claim has been asserted) remains outstanding and until all of the Commitments relating thereto have been terminated, such Grantor shall:

(a) Covenants Relating to Copyrights . (i) Not do any act, or knowingly omit to do any act, whereby any Copyright that is a Material IP Right may become dedicated to the public domain, (ii) notify the Administrative Agent immediately if it knows that any Copyright owned by it that is a Material IP Right may become dedicated to the public domain or of any adverse determination or development (including, without limitation, the institution of, or any such determination or development in, any court or tribunal in the United States or any other country) regarding a Grantor’s ownership of any such Copyright or its validity or enforceability and (iii) take all necessary steps as it shall deem appropriate under the circumstances, to maintain and pursue each application (and to obtain the relevant registration) of each of its Copyrights that is a Material IP Right and to maintain each registration of each of its Copyrights that is a Material IP Right including, without limitation, filing of applications for renewal where necessary.

(b) Covenants Relating to Patents and Trademarks .

(i) (A) Maintain as in the past the quality of products and services offered under each of its Trademarks that is a Material IP Right, (B) to the extent registered, employ each of its Trademarks that is a Material IP Right with the appropriate notice of registration,

if applicable, and (C) not adopt or use any mark that is confusingly similar or a colorable imitation of such Trademarks unless the Administrative Agent, for the ratable benefit of the Secured Parties, shall obtain a perfected security interest in such Trademark pursuant to this Security Agreement.

(ii) Notify the Administrative Agent promptly if it knows that any of its Patents or Trademarks that is a Material IP Right, or any application or registration relating to any of its Patents or Trademarks that is a Material IP Right, may become abandoned, invalidated, rendered unenforceable or dedicated to the public, or of any adverse determination or development (including, without limitation, the institution of, or any such determination or development in, any proceeding in the United States Patent and Trademark Office, or any similar office or agency in any other country or any political subdivision thereof or any court or tribunal in any country) regarding a Grantor’s ownership of any such Patent or Trademark or its right to register the same or to keep and maintain the same.

(iii) Take all reasonable and necessary steps, including, without limitation, in any proceeding before the United States Patent and Trademark Office or any similar office or agency in any other country or any political subdivision thereof, to maintain and pursue each application (and to obtain the relevant registration) and to maintain each registration of each of its Patents and Trademarks that is a Material IP Right, including, without limitation, filing of applications for renewal, affidavits of use and affidavits of incontestability.

(c) Covenant Relating to All Material IP Rights . Not (and not permit any licensee or sublicensee thereof to) do any act, or omit to do any act, whereby any of its Business IP Rights that is a Material IP Right may become abandoned, invalidated, rendered unenforceable, diluted or dedicated to the public.

(d) Confidentiality . Use commercially reasonable efforts to maintain the confidentiality of its trade secrets and other confidential or proprietary information.

(e) Further Assurances . Upon request of the Administrative Agent, execute and deliver any and all agreements, instruments, documents and papers as the Administrative Agent may reasonably request to evidence and perfect the security interest of the Administrative Agent and the Secured Parties in any IP Rights in the Collateral and the goodwill and general intangibles of such Grantor relating thereto or represented thereby.

(f) No Assignment or Agreement . Not make any assignment or agreement in conflict with the security interest in the IP Rights of such Grantor hereunder (other than as permitted by the Credit Agreement).

7. Advances . On failure of any Grantor to perform any of the covenants and agreements contained herein or in any other Loan Document, the Administrative Agent may, at its sole option and in its sole discretion, perform the same and in so doing may expend such sums as the Administrative Agent may reasonably deem advisable in the performance thereof, including, without limitation, the payment of any insurance premiums, the payment of any taxes, a payment to obtain a release of a Lien or potential Lien, expenditures made in defending against any adverse claim and all other expenditures that the Administrative Agent may make for the protection of the security hereof or may be compelled to make by operation of law. All such sums and amounts so expended shall be repayable by the Grantors, on demand, on a joint and several basis (subject to Section 23 hereof) promptly upon timely notice thereof and demand therefor, shall

constitute additional Secured Obligations and shall bear interest from the date said amounts are expended at the Default Rate. No such performance of any covenant or agreement by the Administrative Agent on behalf of any Grantor, and no such advance or expenditure therefor, shall relieve the Grantors of any Default or Event of Default. The Administrative Agent may make any payment hereby authorized in accordance with any bill, statement or estimate procured from the appropriate public office or holder of the claim to be discharged, without inquiry into the accuracy of such bill, statement or estimate or into the validity of any tax assessment, sale, forfeiture, tax lien, title or claim except to the extent such payment is being contested in good faith by a Grantor in appropriate proceedings and against which adequate reserves are being maintained in accordance with GAAP.

8. Remedies .

(a) General Remedies . Upon the occurrence of an Event of Default and during the continuation thereof, the Administrative Agent shall have, in addition to the rights and remedies provided herein, in the Loan Documents, in any other documents relating to the Secured Obligations, or by law (including, without limitation, levy of attachment, garnishment and the rights and remedies set forth in the UCC of the jurisdiction applicable to the affected Collateral), the rights and remedies of a secured party under the UCC of the jurisdiction applicable to the affected Collateral and, further, the Administrative Agent may, with or without judicial process or the aid and assistance of others to the extent permitted by applicable law, (i) enter on any premises on which any of the Collateral may be located and, without resistance or interference by the Grantors, take possession of the Collateral, (ii) dispose of any Collateral on any such premises, (iii) require the Grantors to assemble and make available to the Administrative Agent at the expense of the Grantors any Collateral at any place and time designated by the Administrative Agent that is reasonably convenient to both parties, (iv) remove any Collateral from any such premises for the purpose of effecting the sale or other disposition thereof and/or (v) without demand and without advertisement, notice, hearing or process of law, all of which each of the Grantors hereby waives to the fullest extent permitted by law, at any place and time or times, sell and deliver any or all Collateral held by or for it at public or private sale, by one or more contracts, in one or more parcels, for cash, upon credit or otherwise, at such prices and upon such terms as the Administrative Agent deems advisable, in its sole discretion (subject to any and all mandatory legal requirements). Each of the Grantors acknowledges that any private sale referenced above may be at prices and on terms less favorable to the seller than the prices and terms that might have been obtained at a public sale. In addition to all other sums due the Administrative Agent and the Secured Parties with respect to the Secured Obligations, the Grantors shall pay the Administrative Agent and each of the Secured Parties all reasonable costs and expenses incurred by the Administrative Agent or any such Secured Party, in enforcing its remedies hereunder including, but not limited to, reasonable attorneys’ fees and court costs, in obtaining or liquidating the Collateral, in enforcing payment of the Secured Obligations, or in the prosecution or defense of any action or proceeding by or against the Administrative Agent or the Secured Parties or the Grantors concerning any matter arising out of or connected with this Security Agreement, any Collateral or the Secured Obligations, including, without limitation, any of the foregoing arising in, arising under or related to a case under Debtor Relief Laws. To the extent the rights of notice cannot be legally waived hereunder, each Grantor agrees that any requirement of reasonable notice shall be met if such notice, specifying the place of any public sale or the time after which any private sale is to be made, is personally served on or mailed, postage prepaid, to such Grantor in accordance with the notice provisions of Section 11.02 of the Credit Agreement at least ten (10) Business Days before the time of sale or other event giving rise to the requirement of such notice. The Administrative Agent may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to

which it was so adjourned. The Administrative Agent shall not be obligated to make any sale or other disposition of the Collateral regardless of notice having been given. To the extent permitted by law, any Secured Party may be a purchaser at any such sale. To the extent permitted by applicable law, each of the Grantors hereby waives all of its rights of redemption with respect to any such sale. Subject to the provisions of applicable law, the Administrative Agent and the Secured Parties may postpone or cause the postponement of the sale of all or any portion of the Collateral by announcement at the time and place of such sale, and such sale may, without further notice, to the extent permitted by law, be made at the time and place to which the sale was postponed, or the Administrative Agent may further postpone such sale by announcement made at such time and place.

(b) Remedies Relating to Accounts . Upon the occurrence of an Event of Default and during the continuation thereof, whether or not the Administrative Agent has exercised any or all of its rights and remedies hereunder, (i) each Grantor will promptly upon request of the Administrative Agent instruct all account debtors to remit all payments in respect of Accounts to a mailing location selected by the Administrative Agent and (ii) the Administrative Agent shall have the right to enforce any Grantor’s rights against its customers and account debtors, and the Administrative Agent or its designee may notify (or require such Grantor to notify) any Grantor’s customers and account debtors that the Accounts of such Grantor have been assigned to the Administrative Agent or of the Administrative Agent’s security interest therein and may (either in its own name or in the name of a Grantor or both) demand, collect (including without limitation by way of a lockbox arrangement), receive, take receipt for, sell, sue for, compound, settle, compromise and give acquittance for any and all amounts due or to become due on any Account, and, in the Administrative Agent’s discretion, file any claim or take any other action or proceeding to protect and realize upon the security interest of the Secured Parties in the Accounts. Each Grantor acknowledges and agrees that the Proceeds of its Accounts remitted to or on behalf of the Administrative Agent in accordance with the provisions hereof shall be solely for the Administrative Agent’s own convenience and that such Grantor shall not have any right, title or interest in such Accounts or in any such other amounts except as expressly provided herein. The Administrative Agent and the other Secured Parties shall have no liability or responsibility to any Grantor for acceptance of a check, draft or other order for payment of money bearing the legend “payment in full” or words of similar import or any other restrictive legend or endorsement or be responsible for determining the correctness of any remittance. Furthermore, upon the occurrence of an Event of Default and during the continuation thereof, (i) the Administrative Agent shall have the right, but not the obligation, to make test verifications of the Accounts in any manner and through any medium that it reasonably considers advisable, and the Grantors shall furnish all such assistance and information as the Administrative Agent may require in connection with such test verifications, (ii) upon the Administrative Agent’s request and at the expense of the Grantors, the Grantors shall cause independent public accountants or others satisfactory to the Administrative Agent to furnish to the Administrative Agent reports showing reconciliations, aging and test verifications of and trial balances for, the Accounts and (iii) the Administrative Agent in its own name or in the name of others may communicate with account debtors on the Accounts to verify with them to the Administrative Agent’s satisfaction the existence, amount and terms of any Accounts.

(c) Access . In addition to the rights and remedies hereunder, upon the occurrence of an Event of Default and during the continuation thereof, the Administrative Agent shall have the right to enter and remain upon the various premises of the Grantors without cost or charge to the Administrative Agent and use the same, together with materials, supplies, books and records of the Grantors for the purpose of collecting and liquidating the Collateral, or for preparing for sale and conducting the sale of the Collateral, whether by foreclosure, auction or otherwise. In addition, the

Administrative Agent may remove Collateral, or any part thereof, from such premises and/or any records with respect thereto, in order to effectively collect or liquidate such Collateral.

(d) Nonexclusive Nature of Remedies . Failure by the Administrative Agent or the Secured Parties to exercise any right, remedy or option under this Security Agreement, any other Loan Document, any other documents relating to the Secured Obligations, or as provided by law, or any delay by the Administrative Agent or the Secured Parties in exercising the same, shall not operate as a waiver of any such right, remedy or option. No waiver hereunder shall be effective unless it is in writing, signed by the party against whom such waiver is sought to be enforced and then only to the extent specifically stated, which in the case of the Administrative Agent or the Secured Parties shall only be granted as provided herein. To the extent permitted by law, neither the Administrative Agent, the Secured Parties, nor any party acting as attorney for the Administrative Agent or the Secured Parties, shall be liable hereunder for any acts or omissions or for any error of judgment or mistake of fact or law other than their gross negligence or willful misconduct hereunder. The rights and remedies of the Administrative Agent and the Secured Parties under this Security Agreement shall be cumulative and not exclusive of any other right or remedy that the Administrative Agent or the Secured Parties may have.

(e) Retention of Collateral . To the extent permitted by applicable law, in addition to the rights and remedies hereunder, the Administrative Agent may, in compliance with Sections 9-620 and 9-621 of the UCC (or any successor section) or otherwise complying with the requirements of applicable law of the relevant jurisdiction, accept or retain all or any portion of the Collateral in satisfaction of the Secured Obligations. Unless and until the Administrative Agent shall have provided such notices, however, the Administrative Agent shall not be deemed to have accepted or retained any Collateral in satisfaction of any Secured Obligations for any reason.

(f) Deficiency . In the event that the proceeds of any sale, collection or realization are insufficient to pay all amounts to which the Administrative Agent or the Secured Parties are legally entitled, the Grantors shall be jointly and severally liable for the deficiency (subject to Section 23 hereof), together with interest thereon at the Default Rate, together with the costs of collection and the reasonable fees, charges and disbursements of counsel. Any surplus remaining after the full payment and satisfaction of the Secured Obligations shall be returned to the Grantors or to whomsoever a court of competent jurisdiction shall determine to be entitled thereto.

9. Rights of the Administrative Agent .

(a) Power of Attorney . In addition to other powers of attorney contained herein, each Grantor hereby designates and appoints the Administrative Agent, on behalf of the Secured Parties, and each of its designees or agents, as attorney-in-fact of such Grantor, irrevocably and with power of substitution, with authority to take any or all of the following actions upon the occurrence and during the continuation of an Event of Default:

(i) to demand, collect, settle, compromise and adjust, and give discharges and releases concerning the Collateral, all as the Administrative Agent may reasonably deem appropriate;

(ii) to commence and prosecute any actions at any court for the purposes of collecting any of the Collateral and enforcing any other right in respect thereof;

(iii) to defend, settle or compromise any action, suit or proceeding brought and, in connection therewith, give such discharge or release as the Administrative Agent may reasonably deem appropriate;

(iv) to receive, open and dispose of mail addressed to a Grantor and endorse checks, notes, drafts, acceptances, money orders, bills of lading, warehouse receipts or other instruments or documents evidencing payment, shipment or storage of the goods giving rise to the Collateral on behalf of and in the name of such Grantor, or securing, or relating to such Collateral;

(v) to pay or discharge taxes, liens, security interests or other encumbrances levied or placed on or threatened against the Collateral;

(vi) to direct any parties liable for any payment in connection with any of the Collateral to make payment of any and all monies due and to become due thereunder directly to the Administrative Agent or as the Administrative Agent shall direct;

(vii) to receive payment of and receipt for any and all monies, claims and other amounts due and to become due at any time in respect of or arising out of any Collateral;

(viii) to maintain (including determining not to renew, pursue or further file) and enforce all IP Rights, forming any part of the Collateral;

(ix) to sell, assign, transfer, license, make any agreement in respect of, or otherwise deal with or exercise rights in respect of, any Collateral or the goods or services that have given rise thereto, as fully and completely as though the Administrative Agent were the absolute owner thereof for all purposes;

(x) to adjust and settle claims under any insurance policy relating thereto;

(xi) to execute and deliver all assignments, conveyances, statements, financing statements, renewal financing statements, security and pledge agreements, affidavits, notices and other agreements, instruments and documents that the Administrative Agent may reasonably deem appropriate in order to perfect and maintain the security interests and liens granted in this Security Agreement and in order to fully consummate all of the transactions contemplated therein;

(xii) to institute any foreclosure proceedings that the Administrative Agent may reasonably deem appropriate; and

(xiii) to do and perform all such other acts and things as the Administrative Agent may deem appropriate or convenient in connection with the Collateral.

This power of attorney is a power coupled with an interest and shall be irrevocable for so long as any of the Secured Obligations (other than contingent indemnification obligations for which no claim has been asserted) shall remain outstanding and until all of the Commitments relating thereto shall have been terminated. The Administrative Agent shall be under no duty to exercise or withhold the exercise of any of the rights, powers, privileges and options expressly or implicitly granted to the Administrative Agent in this Security Agreement and shall not be liable for any failure

to do so or any delay in doing so. The Administrative Agent shall not be liable for any act or omission or for any error of judgment or any mistake of fact or law in its individual capacity or its capacity as attorney-in-fact except acts or omissions resulting from its gross negligence or willful misconduct. This power of attorney is conferred on the Administrative Agent solely to protect, preserve and realize upon its security interest in the Collateral.

(b) Releases of Collateral . If any Collateral shall be sold, transferred or otherwise disposed of by any Grantor in a transaction permitted by the Credit Agreement, then the Liens and security interests of the Administrative Agent hereunder with respect to such Collateral shall automatically terminate, and the Administrative Agent, at the request and sole expense of such Grantor, shall promptly execute and deliver to such Grantor all releases and other documents and take such other action, reasonably necessary to evidence the release of the Liens created hereby or by any other Collateral Document on such Collateral.

(c) The Administrative Agent’s Duty of Care . Other than the exercise of reasonable care to assure the safe custody of the Collateral while being held by the Administrative Agent hereunder and to account for all proceeds thereof, the Administrative Agent shall have no duty or liability to preserve rights pertaining thereto, it being understood and agreed that the Grantors shall be responsible for preservation of all rights in the Collateral, and the Administrative Agent shall be relieved of all responsibility for the Collateral upon surrendering it or tendering the surrender of it to the Grantors. The Administrative Agent shall be deemed to have exercised reasonable care in the custody and preservation of the Collateral in its possession if such Collateral is accorded treatment substantially equal to that which the Administrative Agent accords its own property, which shall be no less than the treatment employed by a reasonable and prudent agent in the industry, it being understood that the Administrative Agent shall not have responsibility for taking any necessary steps to preserve rights against any parties with respect to any of the Collateral. In the event of a public or private sale of Collateral pursuant to Section 8 hereof, the Administrative Agent shall have no responsibility for (i) ascertaining or taking action with respect to any matters relating to any Collateral, whether or not the Administrative Agent has or is deemed to have knowledge of such matters or (ii) taking any steps to clean, repair or otherwise prepare the Collateral for sale.

10. Application of Proceeds . Upon the acceleration of the Obligations pursuant to Section 9.02 of the Credit Agreement, any payments in respect of the Secured Obligations and any proceeds of the Collateral, when received by the Administrative Agent or any of the Secured Parties in cash or its equivalent, will be applied in reduction of the Secured Obligations in the order set forth in Section 9.03 of the Credit Agreement, and each Grantor irrevocably waives the right to direct the application of such payments and proceeds and acknowledges and agrees that the Administrative Agent shall have the continuing and exclusive right to apply and reapply any and all such payments and proceeds in the Administrative Agent’s sole discretion, notwithstanding any entry to the contrary upon any of its books and records.

11. Continuing Agreement .

(a) This Security Agreement shall be a continuing agreement in every respect and shall remain in full force and effect so long as any of the Secured Obligations (other than contingent indemnification obligations for which no claim has been asserted) remain outstanding and until all of the Commitments relating thereto have been terminated. Upon payment or other satisfaction of all Secured Obligations (other than contingent indemnification obligations for which no claim has been asserted) and termination of the Commitments related thereto, this Security Agreement and the liens and security interests of the Administrative Agent hereunder shall be automatically

terminated and the Administrative Agent shall, upon the request and at the expense of the Grantors, execute and deliver all UCC termination statements and/or other documents and releases reasonably requested by the Grantors evidencing such termination and return to Grantors all Collateral in its possession. Notwithstanding the foregoing, all releases and indemnities provided hereunder shall survive termination of this Security Agreement.

(b) This Security Agreement shall continue to be effective or be automatically reinstated, as the case may be, if at any time payment, in whole or in part, of any of the Secured Obligations is rescinded or must otherwise be restored or returned by the Administrative Agent or any Secured Party as a preference, fraudulent conveyance or otherwise under any bankruptcy, insolvency or similar law, all as though such payment had not been made; provided , that , in the event payment of all or any part of the Secured Obligations is rescinded or must be restored or returned, all costs and expenses (including, without limitation, reasonable attorneys’ fees and disbursements) incurred by the Administrative Agent or any Secured Party in defending and enforcing such reinstatement shall be deemed to be included as a part of the Secured Obligations.

12. Amendments and Waivers . This Security Agreement and the provisions hereof may not be amended, waived, modified, changed, discharged or terminated except as set forth in Section 11.01 of the Credit Agreement.

13. Successors in Interest . This Security Agreement shall create a continuing security interest in the Collateral and shall be binding upon each Grantor, its successors and assigns, and shall inure, together with the rights and remedies of the Administrative Agent and the Secured Parties hereunder, to the benefit of the Administrative Agent and the Secured Parties and their successors and permitted assigns; provided , however , that , none of the Grantors may assign its rights or delegate its duties hereunder without the prior written consent of the requisite Lenders under the Credit Agreement.

14. Notices . All notices required or permitted to be given under this Security Agreement shall be given as provided in Section 11.02 of the Credit Agreement.

15. Counterparts . This Security Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Security Agreement by facsimile or other electronic imaging means (e.g. “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this Security Agreement.

16. Headings . Section headings herein are included for convenience of reference only and shall not affect the interpretation of this Security Agreement.

17. Governing Law; Submission to Jurisdiction; Waiver of Venue, Service of Process, Waiver of Right to Jury Trial . The terms of Section 11.14 of the Credit Agreement and Section 11.15 of the Credit Agreement with respect to governing law, submission to jurisdiction, waiver of venue, service of process and waiver of the right to a jury trial are each incorporated herein by reference, mutatis mutandis , and the parties hereto agree to such terms.

18. Severability . If any provision of this Security Agreement is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Security Agreement shall not be affected or impaired thereby and (b) the parties shall endeavor to negotiate in good faith to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of

which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

19. Entirety . This Security Agreement, the other Loan Documents and the other documents relating to the Secured Obligations represent the entire agreement of the parties hereto and thereto, and supersede all prior agreements and understandings, oral or written, if any, including any proposal letters or correspondence relating to the Loan Documents, any other documents relating to the Secured Obligations, or the transactions contemplated herein and therein.

20. Survival . All representations and warranties of the Grantors hereunder shall survive the execution and delivery of this Security Agreement, the other Loan Documents and the other documents relating to the Secured Obligations, the delivery of the Notes and the extension of credit thereunder or in connection therewith.

21. Other Security . To the extent that any of the Secured Obligations are now or hereafter secured by property other than the Collateral (including, without limitation, real and other personal property and securities owned by a Grantor) or by a guarantee, endorsement or property of any other Person, then to the extent permitted by applicable law the Administrative Agent shall have the right to proceed against such other property, guarantee or endorsement upon the occurrence and during the continuation of any Event of Default, and the Administrative Agent shall have the right, in its sole discretion, to determine which rights, security, liens, security interests or remedies the Administrative Agent shall at any time pursue, relinquish, subordinate, modify or take with respect thereto, without in any way modifying or affecting any of them or the Secured Obligations or any of the rights of the Administrative Agent or the Secured Parties under this Security Agreement, under any of the other Loan Documents or under any other document relating to the Secured Obligations.

22. Rights of Required Lenders . All rights of the Administrative Agent hereunder, if not exercised by the Administrative Agent, may be exercised by the Required Lenders.

23. Joint and Several Obligations of Grantors .

(a) Subject to subsection (c) of this Section 23 , each of the Grantors is accepting joint and several liability hereunder in consideration of the financial accommodation to be provided by the Secured Parties, for the mutual benefit, directly and indirectly, of each of the Grantors and in consideration of the undertakings of each of the Grantors to accept joint and several liability for the obligations of each of them.

(b) Subject to subsection (c) of this Section 23 , each of the Grantors jointly and severally hereby irrevocably and unconditionally accepts, not merely as a surety but also as a co-debtor, joint and several liability with the other Grantors with respect to the payment and performance of all of the Secured Obligations arising under this Security Agreement, the other Loan Documents and any other documents relating to the Secured Obligations, it being the intention of the parties hereto that all the Secured Obligations shall be the joint and several obligations of each of the Grantors without preferences or distinction among them.

(c) Notwithstanding any provision to the contrary contained herein, in any other of the Loan Documents or in any other documents relating to the Secured Obligations, the obligations of each Guarantor under the Credit Agreement, the other Loan Documents and the other documents

relating to the Secured Obligations shall be limited to an aggregate amount equal to the largest amount that would not render such obligations subject to avoidance under Section 548 of the United States Bankruptcy Code or any comparable provisions of any applicable state law.

24. Joinder . At any time after the date of this Security Agreement, one or more additional Subsidiaries may become party hereto by executing and delivering to the Administrative Agent a Joinder Agreement. Immediately upon such execution and delivery of such Joinder Agreement (and without any further action), each such additional Subsidiary will become a party to this Security Agreement as a “Grantor” and have all the rights and obligations of a Grantor hereunder and this Security Agreement and the schedules hereto shall be deemed amended by such Joinder Agreement.

25. Intercreditor Agreement . The Liens, security interests and rights granted pursuant to this Security Agreement are subject to the terms and conditions of any intercreditor agreement entered into by and between the Administrative Agent and the Permitted Senior Revolving Credit Lender, if any.

[Signature Pages Follow]

Each of the parties hereto has caused a counterpart of this Security Agreement to be duly executed and delivered as of the date first above written.



GRANTORS:	ESTABLISHMENT LABS HOLDINGS INC.,
	a BVI business company, limited by shares and
	incorporated under the laws of the British Virgin Islands

	By:	/s/ Juan Jose Chacon
	Name:	Juan Jose Chacon
	Title:	Director

	JAMM TECHNOLOGIES, INC.,
	a Delaware corporation

	By:	/s/ Salvador Dada Santos
	Name:	Salvador Dada Santos
	Title:	Secretary

	Motiva USA LLC,
	a Delaware limited liability company

	By:	/s/ Juan Jose Chacon
	Name:	Juan Jose Chacon
	Title:	Director

ESTABLISHMENT LABS HOLDINGS INC.

U.S. SECURITY AGREEMENT

Accepted and agreed to as of the date first above written.



ADMINISTRATIVE AGENT:	MADRYN HEALTH PARTNERS, LP,
	a Delaware limited partnership

		By:	MADRYN HEALTH ADVISORS, LP,
			its General Partner

			By:	MADRYN HEALTH ADVISORS GP, LLC,
				its General Partner

				By:	/s/ Avinash Amin
				Name:	Avinash Amin
				Title:	Member

ESTABLISHMENT LABS HOLDINGS INC.

U.S. SECURITY AGREEMENT

SCHEDULE 2(c)

COMMERCIAL TORT CLAIMS

None.

SCHEDULE 4(f)

INSTRUMENTS, DOCUMENTS AND TANGIBLE CHATTEL PAPER

None.

SCHEDULE 4(g)

LICENSES

None.

EXHIBIT 5(c)(i)

FORM

NOTICE

GRANT OF SECURITY INTEREST

COPYRIGHTS

United States Copyright Office

Ladies and Gentlemen:

Please be advised that pursuant to the U.S. Security Agreement dated as of August 24, 2017 (as the same may be amended, modified, restated or supplemented from time to time, the “ Security Agreement ”) by and among the Grantors party thereto (each a “ Grantor ” and collectively, the “ Grantors ”) and Madryn Health Partners, LP, as Administrative Agent (the “ Administrative Agent ”) for the Secured Parties referenced therein, the undersigned Grantor has granted a continuing security interest in and continuing lien upon, the copyrights, copyright licenses and copyright applications shown on Schedule 1 attached hereto to the Administrative Agent for the ratable benefit of the Secured Parties.

The undersigned Grantor and the Administrative Agent, on behalf of the Secured Parties, hereby acknowledge and agree that the security interest in the copyrights, copyright licenses and copyright applications set forth on Schedule 1 attached hereto (i) may only be terminated in accordance with the terms of the Security Agreement and (ii) is not to be construed as an assignment of any copyright, copyright license or copyright application.

[Signature pages follow]



Very truly yours,

[GRANTOR]

By:
Name:
Title:

Acknowledged and Accepted:



ADMINISTRATIVE AGENT:	MADRYN HEALTH PARTNERS, LP,
	a Delaware limited partnership

		By:	MADRYN HEALTH ADVISORS, LP,
			its General Partner

			By:	MADRYN HEALTH ADVISORS GP, LLC,
				its General Partner

				By:
				Name:
				Title:

EXHIBIT 5(c)(ii)

FORM

NOTICE

GRANT OF SECURITY INTEREST

PATENTS

United States Patent and Trademark Office

Ladies and Gentlemen:

Please be advised that pursuant to the U.S. Security Agreement dated as of August 24, 2017 (as the same may be amended, modified, restated or supplemented from time to time, the “ Security Agreement ”) by and among the Grantors party thereto (each a “ Grantor ” and collectively, the “ Grantors ”) and Madryn Health Partners, LP, as Administrative Agent (the “ Administrative Agent ”) for the Secured Parties referenced therein, the undersigned Grantor has granted a continuing security interest in and continuing lien upon, the patents, patent licenses and patent applications set forth on Schedule 1 attached hereto to the Administrative Agent for the ratable benefit of the Secured Parties.

The undersigned Grantor and the Administrative Agent, on behalf of the Secured Parties, hereby acknowledge and agree that the security interest in the patents, patent licenses and patent applications set forth on Schedule 1 attached hereto (i) may only be terminated in accordance with the terms of the Security Agreement and (ii) is not to be construed as an assignment of any patent, patent license or patent application.

[Signature pages follow]



Very truly yours,

[GRANTOR]

By:
Name:
Title:

Acknowledged and Accepted:



ADMINISTRATIVE AGENT:	MADRYN HEALTH PARTNERS, LP,
	a Delaware limited partnership

		By:	MADRYN HEALTH ADVISORS, LP,
			its General Partner

			By:	MADRYN HEALTH ADVISORS GP, LLC,
				its General Partner

				By:
				Name:
				Title:

EXHIBIT 5(c)(iii)

FORM

NOTICE

GRANT OF SECURITY INTEREST

TRADEMARKS

United States Patent and Trademark Office

Ladies and Gentlemen:

Please be advised that pursuant to the U.S. Security Agreement dated as of August 24, 2017 (as the same may be amended, modified, restated or supplemented from time to time, the “ Security Agreement ”) by and among the Grantors party thereto (each a “ Grantor ” and collectively, the “ Grantors ”) and Madryn Health Partners, LP, as Administrative Agent (the “ Administrative Agent ”) for the Secured Parties referenced therein, the undersigned Grantor has granted a continuing security interest in and continuing lien upon, the trademarks, trademark licenses and trademark applications set forth on Schedule 1 attached hereto to the Administrative Agent for the ratable benefit of the Secured Parties.

The undersigned Grantor and the Administrative Agent, on behalf of the Secured Parties, hereby acknowledge and agree that the security interest in the trademarks, trademark licenses and trademark applications set forth on Schedule 1 attached hereto (i) may only be terminated in accordance with the terms of the Security Agreement and (ii) is not to be construed as an assignment of any trademark, trademark license or trademark application.

[Signature pages follow]



Very truly yours,

[GRANTOR]

By:
Name:
Title:

Acknowledged and Accepted:



ADMINISTRATIVE AGENT:	MADRYN HEALTH PARTNERS, LP,
	a Delaware limited partnership

		By:	MADRYN HEALTH ADVISORS, LP,
			its General Partner

			By:	MADRYN HEALTH ADVISORS GP, LLC,
				its General Partner

				By:
				Name:
				Title:

Exhibit 4.5

Promissory Note

Amount in $[__________]

Alajuela, Costa Rica [date]

FOR VALUE RECEIVED ESTABLISHMENT LABS HOLDINGS INC. (hereafter, “Borrower”), a company incorporated in the Virgin British Islands, promises to pay [______________], an individual (hereafter, “Lender”), at [___________________], or at such other place as Lender hereof may from time to time designate in writing, the principal sum of [_________________________________] Dollars ($[____________]), with interest accruing on the unpaid principal at the rate of [_______] percent ([__]%) per annum from _____________ until paid. The aforementioned principal sum represents monies owed to [_________________________] for payment on the purchase of chattels.

Principal and interest are payable in yearly installments due on or before the end of the first quarter of every year until paid in full, with the first such payment to be made on or before [______________], and the last payment to be made on or before [______________]. In no event shall interest exceed the maximum amount permitted by law. Any amount collected in excess of the maximum legal rate shall be applied to reduce the principal balance.

Executed in the presence of:



WITNESS

		ESTABLISHMENT LABS HOLDINGS INC.
Name/Address


		By:
Name/Address

Exhibit 4.6

AMENDMENT TO NOTE AND WARRANT PURCHASE AGREEMENT

This AMENDMENT TO NOTE AND WARRANT PURCHASE AGREEMENT (“ Amendment ”) is made and entered into as of December 8 , 2015 by and between ESTABLISHMENT LABS HOLDINGS, INC., a British Virgin Islands company (the “ Company ”), and CPH TU, LP, a Delaware limited partnership (the “ Purchaser ”). The Company and the Purchaser are hereinafter referred to as the “Parties”.

WHEREAS, the Parties entered into that certain Note and Warrant Purchase Agreement, dated as of August 28, 2015 (the “ Agreement ”);

WHEREAS, the Parties desire to increase the authorized aggregate principal amount of the Additional Convertible Notes from up to $5,000,000 to up to $8,000,000; and

WHEREAS, the Parties desire to amend, clarify and supplement the Agreement, as more fully set forth herein.

NOW, THEREFORE, the undersigned Parties hereby agree as follows, notwithstanding anything to the contrary in the Agreement:

1. Sale of Additional Convertible Notes . Section 2.03 of the Agreement is hereby amended by replacing “$5,000,000” with “$8,000,000”.

2. Governing Law . This Amendment shall be governed by, and construed in accordance with, the laws of the British Virgin Islands, without reference to principles of conflict of laws or choice of laws.

3. Amendment Limited . Except as expressly provided herein, each of the provisions of the Agreement shall remain in full force and effect following the execution of this Amendment.

4. Conflicts . In the event of any conflict or inconsistency between the provisions of this Amendment and the provisions of the Agreement or any prior amendment thereto, the provisions of this Amendment shall control.

5. Counterpart; Facsimile Signatures . This Amendment may be executed in a number of counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument, and any of the Parties hereto may execute this Amendment by signing any such counterpart. This Amendment may be executed and delivered by facsimile, or by e-mail in portable document format (.pdf) and delivery of the signature page by such method will be deemed to have the same effect as if the original signature had been delivered to the other parties.

6. Definitions . Capitalized terms defined in the Agreement and not otherwise defined in this Amendment are used herein as so defined.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment to Note and Warrant Purchase Agreement on the day, month and year first above written.



COMPANY:

ESTABLISHMENT LABS HOLDINGS, INC.

By:	/s/ Juan Jose Chacon Quiros
	Name: Juan Jose Chacon Quiros
	Title: CEO

PURCHASER:

CPH TU, LP

By:	Crown Predator Holdings IV, LLC,
	Its general partner

By:	/s/ Nicholas Lewin
	Name: Nicholas Lewin
	Title: Managing Member

Signature Page to Amendment to

Amendment To Note And Warrant Purchase Agreement

6. Definitions . Capitalized terms defined in the Agreement and not otherwise defined in this Amendment are used herein as so defined.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment to Pledge Agreement on the day, month and year first above written.



PLEDGOR:

ESTABLISHMENT LABS HOLDINGS, INC.

By:
	Name:
	Title:

PLEDGEE:

CPH TU, LP

By:	Crown Predator Holdings IV, LLC,
	Its general partner

By:	/s/ Nicholas Lewin
	Name: Nicholas Lewin
	Title: Managing Member

Signature Page to Amendment Pledge Agreement

6. Definitions . Capitalized terms defined in the Agreement and not otherwise defined in this Amendment are used herein as so defined.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment to Note and Warrant Purchase Agreement on the day, month and year first above written.



COMPANY:

ESTABLISHMENT LABS HOLDINGS, INC.

By:
	Name:
	Title:

PURCHASER:

CPH TU, LP

By:	Crown Predator Holdings IV, LLC,
	Its general partner

By:	/s/ Nicholas Lewin
	Name: Nicholas Lewin
	Title: Managing Member

Signature Page to Amendment to

Note And Warrant Purchase Agreement

AMENDMENT TO PLEDGE AGREEMENT

This AMENDMENT TO PLEDGE AGREEMENT (“ Amendment ”) is made and entered into as of December 8 , 2015 by and between ESTABLISHMENT LABS HOLDINGS, INC., a British Virgin Islands company number 1794254 (the “ Pledgor ”), with domicile at British Virgin Islands, OMC Chambers, Wickhams Cay 1, Road Town, Tortola, BVI and duly represented by its incumbent, JUAN JOSE CHACON QUIROS, citizen of Costa Rica, of legal age, divorced once, entrepreneur, residing in Escazu, San Jose, Costa Rica, and bearer of the id number 1-822-006, and CPH TU, LP, a Delaware limited partnership (the “ Pledgee ”), with domicile at 2711 Centerville Road, Suite 400, Wilmington, DE 19808, County of New Castle, and duly represented by its incumbent, NICHOLAS LEWIN, citizen of United States of America, of legal age, single, investor, residing in New York, bearer of the passport issued by his country number 441216547. The Pledgor and the Pledgee are hereinafter referred to as the “Parties”.

WHEREAS, the Parties entered into that certain Pledge Agreement, dated as of August 28, 2015 (the “ Agreement ”), and that certain Note and Warrant Purchase Agreement, dated as of August 28, 2015 (the “ Purchase Agreement ”);

WHEREAS, the Parties are amending the Purchase Agreement to increase the authorized aggregate principal amount of the Additional Convertible Notes from up to $5,000,000 to up to $8,000,000;

WHEREAS, the Parties desire to revise the Agreement to conform to the changes being made to that Purchase Agreement; and

WHEREAS, the Parties desire to amend, clarify and supplement the Agreement, as more fully set forth herein.

NOW, THEREFORE, the undersigned Parties hereby agree as follows, notwithstanding anything to the contrary in the Agreement:

1. Section . Section 1 of the Agreement is hereby amended by replacing “$15.000.000 (Fifteen million US$ dollars)” with “$18.000.000 (Eighteen million US$ dollars)”.

2. Governing Law . This Amendment shall be governed by, and construed in accordance with, the laws of the Republic of Costa Rica, without reference to principles of conflict of laws or choice of laws.

3. Amendment Limited . Except as expressly provided herein, each of the provisions of the Agreement shall remain in full force and effect following the execution of this Amendment.

6. Definitions . Capitalized terms defined in the Agreement and not otherwise defined in this Amendment are used herein as so defined.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment to Pledge Agreement on the day, month and year first above written.



PLEDGOR:

ESTABLISHMENT LABS HOLDINGS, INC.

By:	/s/ Juan Jose Chacon Quiros
	Name: Juan Jose Chacon Quiros
	Title: CEO

PLEDGEE:

CPH TU, LP

By:	Crown Predator Holdings IV, LLC,
	Its general partner

By:	/s/ Nicholas Lewin
	Name: Nicholas Lewin
	Title: Managing Member

Signature Page to Amendment Pledge Agreement

Exhibit 4.7

SECOND AMENDMENT TO NOTE AND WARRANT PURCHASE AGREEMENT

This SECOND AMENDMENT TO NOTE AND WARRANT PURCHASE AGREEMENT (“ Amendment ”) is effective as of September 14, 2016 by and between ESTABLISHMENT LABS HOLDINGS, INC., a British Virgin Islands company (the “ Company ”), and CPH TU, LP, a Delaware limited partnership (the “ Purchaser ”). The Company and the Purchaser are hereinafter referred to as the “Parties”.

WHEREAS, the Parties entered into that certain Note and Warrant Purchase Agreement, dated as of August 28, 2015, as amended on December 8, 2015 (the “ Agreement ”);

WHEREAS, the Parties desire to (a) increase the authorized aggregate principal amount of the Additional Convertible Notes from up to $8,000,000 to up to $14,248,077, (b) extend the deadline for selling Additional Convertible Notes to 365 days after the Closing, and (c) revise several definitions set forth in the Agreement;

WHEREAS, in connection with the amendment to the Agreement, the Company and the Purchaser desire to amend and restate those certain existing convertible secured promissory notes issued by the Company to the Purchaser (“Prior Notes”) similar to any Additional Convertible Notes, substantially in the form of Exhibit B , terminate that certain warrant issued by the Company to the Purchaser and the Company desires to issue to the Purchaser that certain new Convertible Secured Promissory Note, substantially in the form of Exhibit A (the “Note”), which Note shall represent the interest payable from the issuance date of the Prior Notes accrued through the Deemed Maturity Date of such Prior Notes; and

WHEREAS, the Parties desire to amend, clarify and supplement the Agreement, as more fully set forth herein.

NOW, THEREFORE, the undersigned Parties hereby agree as follows, notwithstanding anything to the contrary in the Agreement:

1. Defined Terms – Deemed Repayment Date . The definition of “Deemed Repayment Date” in Section 1.01 of the Agreement is hereby amended and restated to read in its entirety as follows:

““ Deemed Repayment Date ” means the earlier of (a) the Repayment Date, (b) the consummation of a Liquidity Event, or (c) the date on which the maturity of the obligations under the Convertible Note has been accelerated by the Purchaser after the occurrence of an Event of Default; provided, that until the First Lien Obligations have been Paid in Full (each term as defined in that certain Subordination and Intercreditor Agreement by and between Perceptive Credit Holdings, LP and the Purchaser), (i) for purposes of clauses (a) and (c) of this definition only, in no event shall the Deemed Repayment Date be earlier than March 16, 2020, and (ii) for purposes of clause (b) of this definition only, the Deemed Repayment Date shall not occur until the First Lien Obligations have been Paid in Full.”

2. Defined Terms – Fully-Diluted Basis . The definition of “Fully-Diluted Basis” in Section 1.01 of the Agreement is hereby amended and restated to read in its entirety as follows:

““ Fully-Diluted Basis ” means the number of shares of the Company that would be outstanding, as of the date of computation, if all Share Equivalents (other than the Securities issued or issuable upon conversion of the Convertible Notes or upon exercise of the Warrant) had been converted or exercised, regardless of whether they are then convertible or exercisable by their terms or otherwise.”

3. Defined Terms – Conversion Price; Primary Conversion Price . The definition of “Conversion Price” in Section 1.01 of the Agreement is hereby deleted in its entirety, and Section 1.01 of the Agreement is hereby amended by inserting the following language immediately after the definition of “Preferred Stock Purchase Agreement”, which language shall read in its entirety as follows:

““ Primary Conversion Price ” means US$3.9900.”

4. Defined Terms – Interest Conversion Price; Secondary Conversion Price . The definition of “Interest Conversion Price” in Section 1.01 of the Agreement is hereby deleted in its entirety, and Section 1.01 of the Agreement is hereby amended by inserting the following language immediately after the definition of “RVS”, which language shall read in its entirety as follows:

““ Secondary Conversion Price ” means US$4.9143.”

5. Sale of Additional Convertible Notes . Section 2.03 of the Agreement is hereby amended and restated to read in its entirety as follows:

“2.03. Sale of Additional Convertible Notes . After the Closing, upon written notice by the Purchaser to the Company within one hundred twenty (120) days after the Closing, or upon the mutual agreement of the Purchaser and the Company between the one hundred twenty-first (121 ^st ) day after the Closing and the three hundred sixty-fifth (365 ^th ) day after the Closing, the Purchaser shall loan (the “ Additional Loan ”), and the Company shall sell, on the same terms and conditions as those contained in this Agreement, one or more additional Convertible Notes (the “ Additional Convertible Notes ”) to the Purchaser in the aggregate principal amount of up to $14,248,077. With respect to such sales of Additional Convertible Notes made at any additional closing (each an “ Additional Closing ”), (a) such sale shall be made on the same terms and conditions set forth in this Agreement except as set forth herein, (b) the representations and warranties of the Company set forth in Article 4 hereof shall speak as of the date of the respective Additional Closing, except for representations and warranties which speak of a particular date which shall be true and correct on and as of such date, and (iii) the representations and warranties of the Purchaser in Article 5 hereof shall speak as of the date of the respective Additional Closing. Any Additional Loan pursuant to this Section 2.03 shall be deemed to be a “ Loan ” for all purposes under this Agreement, and any Additional Convertible Notes sold pursuant to this Section 2.03 shall be deemed to be a “ Convertible Note ” for all purposes under this Agreement. At each Additional Closing, (a) the Company will issue and deliver to the Purchaser an Additional Convertible Note registered in the name of the Purchaser, substantially in the form of Exhibit G , and (b) the Purchaser shall deliver to the Company as payment in full for the Additional

Convertible Note an amount equal to the principal amount of such Additional Convertible Note (the “ Additional Purchase Price ”). At each Additional Closing, the Purchaser will deliver to the Company, an amount of cash equal to the Additional Purchase Price (minus the fees payable by the Company to RVS in connection with the Additional Closing (the “ Additional RVS Fee ”)), by wire transfer in immediately available funds to the account of the Company that the Company shall have designated to the Purchaser at least forty-eight (48) hours prior to the Additional Closing and to RVS, an amount of cash equal to the Additional RVS Fee, by wire transfer in immediately available funds to the account of RVS that RVS shall have designated to the Purchaser at least forty-eight (48) hours prior to the Additional Closing. The Company shall notify the Purchaser of the amount of the fees payable by the Company to RVS in connection with the Additional Closing at least forty-eight (48) hours prior to the Additional Closing.”

6. Exhibit G – Form of Additional Convertible Note . The Agreement is hereby amended by inserting the language set forth on Exhibit B hereto (which language shall read in its entirety as set forth on Exhibit B hereto) following Exhibit F of the Agreement.

7. Additional Note . In connection with the issuance of Additional Convertible Notes after the date hereof, the Company shall issue to the Purchaser a Convertible Secured Promissory Note, substantially in the form of Exhibit A , with a principal amount mutually acceptable to the Company and the Purchaser.

8. Governing Law . This Amendment shall be governed by, and construed in accordance with, the laws of the British Virgin Islands, without reference to principles of conflict of laws or choice of laws.

9. Amendment Limited . Except as expressly provided herein, each of the provisions of the Agreement shall remain in full force and effect following the execution of this Amendment.

10. Conflicts . In the event of any conflict or inconsistency between the provisions of this Amendment and the provisions of the Agreement or any prior amendment thereto, the provisions of this Amendment shall control.

11. Counterpart; Facsimile Signatures . This Amendment may be executed in a number of counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument, and any of the Parties hereto may execute this Amendment by signing any such counterpart. This Amendment may be executed and delivered by facsimile, or by e-mail in portable document format (.pdf) and delivery of the signature page by such method will be deemed to have the same effect as if the original signature had been delivered to the other parties.

12. Definitions . Capitalized terms defined in the Agreement and not otherwise defined in this Amendment are used herein as so defined.

[Signatures on Following Page]

IN WITNESS WHEREOF, the parties hereto have executed this Second Amendment to Note and Warrant Purchase Agreement effective as the day, month and year first above written.



COMPANY :

ESTABLISHMENT LABS HOLDINGS, INC.

By:	/s/ Juan Jose Chacon Quiros
	Name: JUAN JOSE CHACON QUIROS
	Title: CHIEF EXECUTIVE OFFICER

PURCHASER :

CPH TU, LP

By:	Crown Predator Holdings IV, LLC,
	Its general partner

By:	/s/ Nicholas Lewin
	Name: Nicholas Lewin
	Title: Managing Member

Signature Page to Second Amendment to
Note and Warrant Purchase Agreement

Exhibit A

Form of Note

Exhibit B

Additional Exhibit

“EXHIBIT G

Form of Additional Convertible Note

ESTABLISHMENT LABS HOLDINGS INC.
CONVERTIBLE SECURED PROMISSORY NOTE



$[______]	[______]

FOR VALUE RECEIVED, ESTABLISHMENT LABS HOLDINGS INC., a British Virgin Islands company (the “Borrower”), hereby promises to pay to the order of CPH TU, LP, a Delaware limited partnership (the “Lender”), or its registered assigns, at such place of payment as the holder of this Convertible Secured Promissory Note (this “ Note ”) may specify from time to time in writing, in lawful money of the United States of America, the principal amount of [_____] DOLLARS (US [_____] ) (the “ Principal Amount ”), with no interest thereon.

“ Balance ” means, at the applicable time, the sum of all then outstanding principal of this Note.

This Note is the Convertible Note referred to in, and is executed and delivered in connection with, that certain Note and Warrant Purchase Agreement dated as of August 28, 2015 (as amended to date, the “ Purchase Agreement ”), entered into between the Borrower and the Lender, and is entitled to the benefit and security of the Purchase Agreement and the other Transaction Documents, to which reference is made for a statement of all of the terms and conditions thereof. All payments shall be made in accordance with the Purchase Agreement. All terms defined in the Purchase Agreement shall have the same definitions when used herein, unless otherwise defined herein.

Unless previously (or simultaneously) paid or converted as set forth below and in the Purchase Agreement, the Balance hereunder shall become due and payable upon the Deemed Repayment Date.

Payment of this Note is secured by a security interest in substantially all of the property of the Borrower and the Subsidiaries pursuant to the Security Agreement and the Security and Guaranty Agreement

The following is a statement of the rights of the Lender and the terms and conditions to which this Note is subject and to which the Lender, by acceptance of this Note, agrees:

1. Payment . All payments shall be made in lawful money of the United States of America in immediately available funds at the principal office of the Lender, or such other place as the holder hereof may from time to time designate in writing to the Borrower. If any payment to be

made hereunder falls due on a day which is not a Business Day, any such payment shall be made on the next succeeding Business Day. All amounts due under this Agreement shall be payable without defense, set off or counterclaim.

2. Interest . No interest shall accrue on the outstanding Principal Amount under this Note.

3. Application of Payments . Unless otherwise notified in writing by Lender to Borrower, all payments will be applied to the repayment of principal until all principal has been paid in full.

4. Conversion of Note .

(a) The entire outstanding Balance hereunder shall be repaid in cash or cash equivalents on the Deemed Repayment Date; provided, however, that if the Lender provides written notice to the Borrower on or prior to the Deemed Maturity Date indicating the Lender’s election to have all or any portion of the outstanding Balance hereunder converted as of the Deemed Maturity Date into Ordinary Shares, then only that portion of the outstanding Balance that the Lender has not elected to be converted into Ordinary Shares at the Primary Conversion Price shall be repaid in cash or cash equivalents on the Deemed Repayment Date, and the remainder shall be converted as of the Deemed Maturity Date into Ordinary Shares at the Primary Conversion Price; provided, further, if the Lender provides no notice to the Borrower, or provides written notice to the Borrower on or prior to the Deemed Maturity Date indicating the Lender’s election to have less than all of the Balance converted into Ordinary Shares on the Deemed Maturity Date, and the Borrower effects a Liquidity Event (as defined in the Purchase Agreement), or enters into a definitive agreement to effect a Liquidity Event, on or prior to the Deemed Repayment Date, the Borrower shall provide at least thirty-five (35) days prior written notice to the Lender of such Liquidity Event (the “ Liquidity Event Notice ”), in which case the Lender may, within thirty (30) days after receipt by the Lender of the Liquidity Event Notice, provide written notice to the Borrower of its election, effective at such closing of such Liquidity Event, to have such portion of the Balance automatically converted into Ordinary Shares at the Primary Conversion Price; provided that, if such Liquidity Event is not consummated within six (6) months after the Deemed Repayment Date, such portion of the Balance shall be due and payable in cash or cash equivalents on the six-month anniversary of the Deemed Repayment Date.

(b) Except for the right to receive repayment under the Note or obtain certificates representing the Ordinary Shares set forth in Section 4(c) below and rights related to a Liquidity Event in Section 4(a) above, all rights with respect to this Note shall terminate upon the effective conversion of the entire Balance of this Note and the occurrence of the Deemed Repayment Date, whether or not this Note has been surrendered to the Borrower for cancellation.

(c) Subject to Section 4(b) above, as promptly as practicable after any conversion of this Note, the Borrower at its expense will issue and deliver to the Lender a certificate or certificates evidencing the number of Ordinary Shares issued to the Lender in connection with such conversion.

5. Events of Default . At the written election of the Purchaser to the Borrower following the occurrence of an Event of Default, the Balance shall become due and payable within three (3) Business Days of the giving of such election; provided , that upon the occurrence of an Event of Default specified in paragraphs (h) or (i) of the definition thereof, the obligation of the Lender to make additional Loans shall be immediately terminated and all the Balance shall become immediately due and payable without declaration, notice or demand by any Person.

6. Transfers . The Lender hereof may transfer this Note or any of the rights or obligations hereunder to any party without the prior written consent of the Borrower.

7. GOVERNING LAW . THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE BRITISH VIRGIN ISLANDS, WITHOUT REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS OR CHOICE OF LAWS.

8. Amendment . Any term of this Note may be amended or waived in accordance with the terms of the Purchase Agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed by its duly authorized officers as of the date first above written.



“BORROWER”
ESTABLISHMENT LABS HOLDINGS INC.

By:
	Name: JUAN JOSÉ CHACÓN QUIRÓS
	Title: CHIEF EXECUTIVE OFFICER

Address:		B15 COYOL FREE ZONE, ALAJUELA,
		20113, COSTA RICA
		Attn: GENERAL COUNSEL
		Fax: (+506) 24342450



Acknowledged and agreed by :
“LENDER”
CPH TU, LP

By:	Crown Predator Holdings IV, LLC,
	its general partner



By:
	Name:
	Title:

Address:		c/o Crown Predator Holdings IV, LLC
		221 East 59th Street
		New York, NY 10022
		Attn: Manager”

Exhibit 10.1

ESTABLISHMENT LABS HOLDINGS INC.

INDEMNIFICATION AGREEMENT

This Indemnification Agreement (this “ Agreement ”) is dated as of __________, 2018 (the “ Effective Date ”), and is between Establishment Labs Holdings Inc., a company incorporated under the laws of the British Virgin Islands (the “ Company ”), and ______________________ (“ Indemnitee ”).

RECITALS

A. Indemnitee’s service to the Company substantially benefits the Company.

B. Individuals are reluctant to serve as directors or officers of companies or in certain other capacities unless they are provided with adequate protection through insurance or indemnification against the risks of claims and actions against them arising out of such service.

C. Indemnitee does not regard the protection currently provided by applicable law, the Company’s governing documents and any insurance as adequate under the present circumstances, and Indemnitee may not be willing to serve as a director or officer without additional protection.

D. In order to induce Indemnitee to continue to provide services to the Company, it is reasonable, prudent and necessary for the Company to contractually obligate itself to indemnify, and to advance expenses on behalf of, Indemnitee as permitted by applicable law.

E. This Agreement is a supplement to and in furtherance of the indemnification provided in the Company’s memorandum and articles of association and applicable law, and any resolutions adopted pursuant thereto, and this Agreement shall not be deemed a substitute therefor, nor shall this Agreement be deemed to limit, diminish or abrogate any rights of Indemnitee thereunder.

The parties therefore agree as follows:

1. Definitions.

(a) “ BVI Law ” means the applicable laws of the British Virgin Islands.

(b) A “ Change in Control ” shall be deemed to occur upon the earliest to occur after the date of this Agreement of any of the following events:

(i) Acquisition of Shares by Third Party. Any Person (as defined below) becomes the Beneficial Owner (as defined below), directly or indirectly, of shares of the Company representing fifteen percent (15%) or more of the combined voting power of the Company’s then outstanding shares; provided, however, that the foregoing shall not include any Person having such status prior to the consummation of the initial public offering of the Company’s shares unless after the initial public offering such Person is or becomes the Beneficial Owner, directly or indirectly, of additional shares of the Company representing in the aggregate an additional five percent (5%) or more of the combined voting power of the Company’s then outstanding shares;

(ii) Change in Board Composition. During any period of two consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of such period constitute the Company’s board of directors, and any new directors (other than a director designated

by a person who has entered into an agreement with the Company to effect a transaction described in Sections 1(b)(i), 1(b)(iii) or 1(b)(iv)) whose election by the board of directors or nomination for election by the Company’s shareholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority of the members of the Company’s board of directors;

(iii) Corporate Transactions. The effective date of a merger or consolidation of the Company with any other entity, other than a merger or consolidation which would result in the voting shares of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting shares of the surviving entity) more than 50% of the combined voting power of the voting shares of the surviving entity outstanding immediately after such merger or consolidation and with the power to elect at least a majority of the board of directors or other governing body of such surviving entity;

(iv) Liquidation. The approval by the shareholders of the Company of a complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets; and

(v) Other Events. Any other event of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on any similar schedule or form) promulgated under the Securities Exchange Act of 1934, as amended, whether or not the Company is then subject to such reporting requirement.

For purposes of this Section 1(b), the following terms shall have the following meanings:

(1) “ Person ” shall have the meaning as set forth in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended; provided, however, that “ Person ” shall exclude (i) the Company, (ii) any trustee or other fiduciary holding shares under an employee benefit plan of the Company, and (iii) any corporation owned, directly or indirectly, by the shareholders of the Company in substantially the same proportions as their ownership of shares of the Company.

(2) “ Beneficial Owner ” shall have the meaning given to such term in Rule 13d-3 under the Securities Exchange Act of 1934, as amended; provided, however, that “ Beneficial Owner ” shall exclude any Person otherwise becoming a Beneficial Owner by reason of (i) the shareholders of the Company approving a merger of the Company with another entity or (ii) the Company’s board of directors approving a sale of shares by the Company to such Person.

(c) “ Corporate Status ” describes the status of a person who is or was a director, trustee, general partner, managing member, officer, employee, agent or fiduciary of the Company or any other Enterprise.

(d) “ Disinterested Director ” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.

(e) “ Enterprise ” means the Company and any other corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise of which Indemnitee is or was serving at the request of the Company as a director, trustee, general partner, managing member, officer, employee, agent or fiduciary.

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(f) “ Expenses ” include all reasonable and actually incurred attorneys’ fees, retainers, court costs, transcript costs, fees and costs of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding. Expenses also include (i) Expenses incurred in connection with any appeal resulting from any Proceeding, including without limitation the premium, security for, and other costs relating to any cost bond, supersedeas bond or other appeal bond or their equivalent, and (ii) for purposes of Section 12(d), Expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement or under any directors’ and officers’ liability insurance policies maintained by the Company. Expenses, however, shall not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee.

(g) “ Independent Counsel ” means a law firm, or a partner or member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five years has been, retained to represent (i) the Company or Indemnitee in any matter material to either such party (other than as Independent Counsel with respect to matters concerning Indemnitee under this Agreement, or other indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “ Independent Counsel ” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

(h) “ Proceeding ” means any threatened, pending or completed action, suit, arbitration, mediation, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or proceeding, whether brought in the right of the Company, a Subsidiary or otherwise and whether of a civil, criminal, administrative or investigative nature, including any appeal therefrom and including without limitation any such Proceeding pending as of the date of this Agreement, in which Indemnitee was, is or will be involved as a party, a potential party, a non-party witness or otherwise by reason of (i) the fact that Indemnitee is or was a director or officer of the Company or of a Subsidiary, (ii) any action taken by Indemnitee or any action or inaction on Indemnitee’s part while acting as a director or officer of the Company, or (iii) the fact that he or she is or was serving at the request of the Company, or of a Subsidiary as a director, trustee, general partner, managing member, officer, employee, agent or fiduciary of the Company, a Subsidiary or any other Enterprise, in each case whether or not serving in such capacity at the time any liability or Expense is incurred for which indemnification or advancement of expenses can be provided under this Agreement.

(i) “ Subsidiary ” means any entity of which more than 50% of the outstanding voting shares is owned directly or indirectly by the Company.

(j) Reference to “ other enterprises ” shall include employee benefit plans; references to “ fines ” shall include any excise taxes assessed on a person with respect to any employee benefit plan; references to “ serving at the request of the Company ” shall include any service as a director, officer, employee or agent of the Company or of a Subsidiary which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner he or she reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “ not opposed to the best interests of the Company ” as referred to in this Agreement.

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2. Indemnity in Third-Party Proceedings. The Company shall indemnify Indemnitee in accordance with the provisions of this Section 2 if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding, other than a Proceeding by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 2, Indemnitee shall be indemnified to the fullest extent permitted by applicable law against all Expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee or on his or her behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Company and, with respect to any criminal action or proceeding, had no reasonable cause to believe that his or her conduct was unlawful.

3. Indemnity in Proceedings by or in the Right of the Company. The Company shall indemnify Indemnitee in accordance with the provisions of this Section 3 if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 3, Indemnitee shall be indemnified to the fullest extent permitted by applicable law against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Company. No indemnification for Expenses shall be made under this Section 3 in respect of any claim, issue or matter as to which Indemnitee shall have been adjudged by a court of competent jurisdiction to be liable to the Company, unless and only to the extent that the courts of the British Virgin Islands shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnification for such expenses as the courts of the British Virgin Islands shall deem proper.

4. Indemnification for Expenses of a Party Who is Wholly or Partly Successful. To the extent that Indemnitee is a party to or a participant in and is successful (on the merits or otherwise) in defense of any Proceeding or any claim, issue or matter therein, the Company shall indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith. For purposes of this Section 4, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.

5. Indemnification for Expenses of a Witness. To the extent that Indemnitee is, by reason of his or her Corporate Status, a witness in any Proceeding to which Indemnitee is not a party, Indemnitee shall be indemnified to the fullest extent permitted by applicable law against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith.

6. Additional Indemnification.

(a) Notwithstanding any limitation in Sections 2, 3 or 4, the Company shall indemnify Indemnitee to the fullest extent permitted by applicable law if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding (including a Proceeding by or in the right of the Company to procure a judgment in its favor) against all Expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee or on his or her behalf in connection with the Proceeding or any claim, issue or matter therein.

(b) For purposes of Section 6(a), the meaning of the phrase “ to the fullest extent permitted by applicable law ” shall include, but not be limited to:

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(i) the fullest extent permitted by the provision of the DGCL that authorizes or contemplates additional indemnification by agreement, or the corresponding provision of any amendment to or replacement of BVI Law; and

(ii) the fullest extent authorized or permitted by any amendments to or replacements of BVI Law adopted after the date of this Agreement that increase the extent to which a corporation may indemnify its officers and directors.

7. Exclusions. Notwithstanding any provision in this Agreement, the Company shall not be obligated under this Agreement to make any indemnity in connection with any Proceeding (or any part of any Proceeding):

(a) for which payment has actually been made to or on behalf of Indemnitee under any statute, insurance policy, indemnity provision, vote or otherwise, except with respect to any excess beyond the amount paid;

(b) for an accounting or disgorgement of profits pursuant to Section 16(b) of the Securities Exchange Act of 1934, as amended, or similar provisions of federal, state or local statutory law or common law, if Indemnitee is held liable therefor (including pursuant to any settlement arrangements);

(c) for any reimbursement of the Company by Indemnitee of any bonus or other incentive-based or equity-based compensation or of any profits realized by Indemnitee from the sale of shares of the Company, as required in each case under the Securities Exchange Act of 1934, as amended (including any such reimbursements that arise from an accounting restatement of the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002 (the “ Sarbanes-Oxley Act ”), or Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, or the payment to the Company of profits arising from the purchase and sale by Indemnitee of shares in violation of Section 306 of the Sarbanes-Oxley Act), if Indemnitee is held liable therefor (including pursuant to any settlement arrangements);

(d) initiated by Indemnitee, including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the Company or its directors, officers, employees, agents or other indemnitees, unless (i) the Company’s board of directors authorized the Proceeding (or the relevant part of the Proceeding) prior to its initiation, (ii) the Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law, (iii) otherwise authorized in Section 12(d) or (iv) otherwise required by applicable law or the Company’s memorandum and articles of association; or

(e) if prohibited by applicable law.

8. Advances of Expenses. The Company shall advance the Expenses incurred by Indemnitee in connection with any Proceeding prior to its final disposition, and such advancement shall be made as soon as reasonably practicable, but in any event no later than 30 days, after the receipt by the Company of a written statement or statements requesting such advances from time to time (which shall include invoices received by Indemnitee in connection with such Expenses but, in the case of invoices in connection with legal services, any references to legal work performed or to expenditure made that would cause Indemnitee to waive any privilege accorded by applicable law shall not be included with the invoice). Advances shall be unsecured and interest free and made without regard to Indemnitee’s ability to repay such advances. Indemnitee hereby undertakes to repay any advance to the extent that it is ultimately determined that Indemnitee is not entitled to be indemnified by the Company. This Section 8 shall not apply to the extent advancement is prohibited by law and shall not apply to any Proceeding (or any part of

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any Proceeding) for which indemnity is not permitted under this Agreement, but shall apply to any Proceeding (or any part of any Proceeding) referenced in Section 7(b) or 7(c) prior to a determination that Indemnitee is not entitled to be indemnified by the Company.

9. Procedures for Notification and Defense of Claim.

(a) Indemnitee shall notify the Company in writing of any matter with respect to which Indemnitee intends to seek indemnification or advancement of Expenses as soon as reasonably practicable following the receipt by Indemnitee of notice thereof. The written notification to the Company shall include, in reasonable detail, a description of the nature of the Proceeding and the facts underlying the Proceeding. The failure by Indemnitee to notify the Company will not relieve the Company from any liability which it may have to Indemnitee hereunder or otherwise than under this Agreement, and any delay in so notifying the Company shall not constitute a waiver by Indemnitee of any rights.

(b) If, at the time of the receipt of a notice of a Proceeding pursuant to the terms hereof, the Company has directors’ and officers’ liability insurance in effect that may be applicable to the Proceeding, the Company shall give prompt notice of the commencement of the Proceeding to the insurers in accordance with the procedures set forth in the applicable policies. The Company shall thereafter take all commercially-reasonable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies.

(c) In the event the Company may be obligated to make any indemnity in connection with a Proceeding, the Company shall be entitled to assume the defense of such Proceeding with counsel approved by Indemnitee, which approval shall not be unreasonably withheld, conditioned or delayed, upon the delivery to Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee for any fees or expenses of counsel subsequently incurred by Indemnitee with respect to the same Proceeding. Notwithstanding the Company’s assumption of the defense of any such Proceeding, the Company shall be obligated to pay the fees and expenses of Indemnitee’s separate counsel to the extent (i) the employment of separate counsel by Indemnitee is authorized by the Company, (ii) counsel for the Company or Indemnitee shall have reasonably concluded that there is a conflict of interest between the Company and Indemnitee in the conduct of any such defense such that Indemnitee needs to be separately represented, (iii) the Company is not financially or legally able to perform its indemnification obligations or (iv) the Company shall not have retained, or shall not continue to retain, counsel to defend such Proceeding. Regardless of any provision in this Agreement, Indemnitee shall have the right to employ counsel in any Proceeding at Indemnitee’s personal expense. The Company shall not be entitled, without the consent of Indemnitee, to assume the defense of any claim brought by or in the right of the Company.

(d) Indemnitee shall give the Company such information and cooperation in connection with the Proceeding as may be reasonably appropriate.

(e) The Company shall not be liable to indemnify Indemnitee for any settlement of any Proceeding (or any part thereof) without the Company’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed.

(f) The Company shall not settle any Proceeding (or any part thereof) in a manner that imposes any penalty or liability on Indemnitee without Indemnitee’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed.

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10. Procedures upon Application for Indemnification.

(a) To obtain indemnification, Indemnitee shall submit to the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and as is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification following the final disposition of the Proceeding. Any delay in providing the request will not relieve the Company from its obligations under this Agreement, except to the extent such failure is prejudicial.

(b) Upon written request by Indemnitee for indemnification pursuant to Section 10(a), a determination with respect to Indemnitee’s entitlement thereto shall be made in the specific case (i) if a Change in Control shall have occurred, by Independent Counsel in a written opinion to the Company’s board of directors, a copy of which shall be delivered to Indemnitee or (ii) if a Change in Control shall not have occurred, (A) by a majority vote of the Disinterested Directors, even though less than a quorum of the Company’s board of directors, (B) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum of the Company’s board of directors, (C) if there are no such Disinterested Directors or, if such Disinterested Directors so direct, by Independent Counsel in a written opinion to the Company’s board of directors, a copy of which shall be delivered to Indemnitee or (D) if so directed by the Company’s board of directors, by the shareholders of the Company. If it is determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within twenty days after such determination. Indemnitee shall cooperate with the person, persons or entity making the determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information that is not privileged or otherwise protected from disclosure and that is reasonably available to Indemnitee and reasonably necessary to such determination. Any costs or expenses (including attorneys’ fees and disbursements) actually and reasonably incurred by Indemnitee in so cooperating with the person, persons or entity making such determination shall be borne by the Company, to the extent permitted by applicable law.

(c) In the event the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 10(b), the Independent Counsel shall be selected as provided in this Section 10(c). If a Change in Control shall not have occurred, the Independent Counsel shall be selected by the Company’s board of directors, and the Company shall give written notice to Indemnitee advising him or her of the identity of the Independent Counsel so selected. If a Change in Control shall have occurred, the Independent Counsel shall be selected by Indemnitee (unless Indemnitee shall request that such selection be made by the Company’s board of directors, in which event the preceding sentence shall apply), and Indemnitee shall give written notice to the Company advising it of the identity of the Independent Counsel so selected. In either event, Indemnitee or the Company, as the case may be, may, within ten days after such written notice of selection shall have been given, deliver to the Company or to Indemnitee, as the case may be, a written objection to such selection; provided , however , that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of “Independent Counsel” as defined in Section 1 of this Agreement, and the objection shall set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the person so selected shall act as Independent Counsel. If such written objection is so made and substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit. If, within 30 days after the later of (i) submission by Indemnitee of a written request for indemnification pursuant to Section 10(a) hereof and (ii) the final disposition of the Proceeding, the parties have not agreed upon an Independent Counsel, either the Company or Indemnitee may petition a court of competent jurisdiction for resolution of any objection which shall have been made

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by the Company or Indemnitee to the other’s selection of Independent Counsel and for the appointment as Independent Counsel of a person selected by the court or by such other person as the court shall designate, and the person with respect to whom all objections are so resolved or the person so appointed shall act as Independent Counsel under Section 10(b) hereof. Upon the due commencement of any judicial proceeding or arbitration pursuant to Section 12(a) of this Agreement, the Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).

(d) The Company agrees to pay the reasonable fees and expenses of any Independent Counsel and to fully indemnify such counsel against any and all Expenses, claims, liabilities and damages arising out of or relating to this Agreement or its engagement pursuant hereto.

(e) Notwithstanding a final determination by any reviewing party identified in Section 10(b) above that Indemnitee is not entitled to indemnification with respect to a specific Proceeding, Indemnitee shall have the right to apply to the courts of the British Virgin Islands, for the purpose of enforcing Indemnitee’s right to indemnification pursuant to the provisions of this Agreement, the Company’s memorandum and articles of association or BVI Law.

11. Presumptions and Effect of Certain Proceedings.

(a) In making a determination with respect to entitlement to indemnification hereunder, the person, persons or entity making such determination shall, to the fullest extent not prohibited by law, presume that Indemnitee is entitled to indemnification under this Agreement, and the Company shall, to the fullest extent not prohibited by law, have the burden of proof to overcome that presumption.

(b) The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that his or her conduct was unlawful.

(c) For purposes of any determination of good faith, Indemnitee shall be deemed to have acted in good faith to the extent Indemnitee relied in good faith on (i) the records or books of account of the Enterprise, including financial statements, (ii) information supplied to Indemnitee by the officers of the Enterprise in the course of their duties, (iii) the advice of legal counsel for the Enterprise or its board of directors or counsel selected by any committee of the board of directors or (iv) information or records given or reports made to the Enterprise by an independent certified public accountant, an appraiser, investment banker or other expert selected with reasonable care by the Enterprise or its board of directors or any committee of the board of directors. The provisions of this Section 11(c) shall not be deemed to be exclusive or to limit in any way the other circumstances in which Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.

(d) Neither the knowledge, actions nor failure to act of any other director, officer, agent or employee of the Enterprise shall be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement.

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12. Remedies of Indemnitee.

(a) Subject to Section 12(e), in the event that (i) a determination is made pursuant to Section 10 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 8 or 12(d) of this Agreement, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 10 of this Agreement within 90 days after the later of the receipt by the Company of the request for indemnification or the final disposition of the Proceeding, (iv) payment of indemnification pursuant to this Agreement is not made (A) within twenty days after a determination has been made that Indemnitee is entitled to indemnification or (B) with respect to indemnification pursuant to Sections 4, 5 and 12(d) of this Agreement, within 30 days after receipt by the Company of a written request therefor, or (v) the Company or any other person or entity takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or proceeding designed to deny, or to recover from, Indemnitee the benefits provided or intended to be provided to Indemnitee hereunder, Indemnitee shall be entitled to an adjudication by a court of competent jurisdiction of his or her entitlement to such indemnification or advancement of Expenses. The Company shall not oppose Indemnitee’s right to seek any such adjudication in accordance with this Agreement.

(b ) Neither (i) the failure of the Company, its board of directors, any committee or subgroup of the board of directors, Independent Counsel or shareholders to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor (ii) an actual determination by the Company, its board of directors, any committee or subgroup of the board of directors, Independent Counsel or shareholders that Indemnitee has not met the applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct. In the event that a determination shall have been made pursuant to Section 10 of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding commenced pursuant to this Section 12 shall be conducted in all respects as a de novo trial, on the merits, and Indemnitee shall not be prejudiced by reason of that adverse determination. In any judicial proceeding commenced pursuant to this Section 12, the Company shall, to the fullest extent not prohibited by law, have the burden of proving Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be.

(c) To the fullest extent not prohibited by law, the Company shall be precluded from asserting in any judicial proceeding commenced pursuant to this Section 12 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court that the Company is bound by all the provisions of this Agreement. If a determination shall have been made pursuant to Section 10 of this Agreement that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding commenced pursuant to this Section 12, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statements not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law.

(d) To the extent not prohibited by law, the Company shall indemnify Indemnitee against all Expenses that are incurred by Indemnitee in connection with any action for indemnification or advancement of Expenses from the Company under this Agreement or under any directors’ and officers’ liability insurance policies maintained by the Company to the extent Indemnitee is successful in such action, and, if requested by Indemnitee, shall (as soon as reasonably practicable, but in any event no later than 30 days, after receipt by the Company of a written request therefor) advance such Expenses to Indemnitee, subject to the provisions of Section 8.

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(e) Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement to indemnification shall be required to be made prior to the final disposition of the Proceeding.

13. Contribution. To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amounts incurred by Indemnitee, whether for Expenses, judgments, fines or amounts paid or to be paid in settlement, in connection with (a) any claim relating to an indemnifiable event under this Agreement in which the Company and Indemnitee are held to be jointly liable, (i) all such amounts incurred by Indemnitee and will waive and relinquish any right of contribution it may have against Indemnitee, or (ii) if such contribution is not permissible under applicable law, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (x) the relative benefits received by the Company and Indemnitee as a result of the events and transactions giving rise to such Proceeding; and (y) the relative fault of Indemnitee and the Company (and its other directors, officers, employees and agents) in connection with such events and transactions, or (b) any other claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the events and transactions giving rise to such Proceeding; and (ii) the relative fault of Indemnitee and the Company (and its other directors, officers, employees and agents) in connection with such events and transactions.

14. Non-exclusivity. The rights of indemnification and to receive advancement of Expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Company’s memorandum and articles of association, any agreement, a vote of shareholders or a resolution of directors, or otherwise. To the extent that a change in BVI Law, whether by statute or judicial decision, permits greater indemnification or advancement of Expenses than would be afforded currently under the Company’s memorandum and articles of association and this Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change, subject to the restrictions expressly set forth herein or therein. Except as expressly set forth herein, no right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. Except as expressly set forth herein, the assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.

15. Primary Responsibility. The Company acknowledges that Indemnitee may have certain rights to indemnification and advancement of expenses provided by third parties (collectively, the “ Secondary Indemnitors ”). The Company agrees that, as between the Company and the Secondary Indemnitors, the Company is primarily responsible for amounts required to be indemnified or advanced under the Company’s memorandum and articles of association or this Agreement and any obligation of the Secondary Indemnitors to provide indemnification or advancement for the same amounts is secondary to those Company obligations. To the extent not in contravention of any insurance policy or policies providing liability or other insurance for the Company or any director, trustee, general partner, managing member, officer, employee, agent or fiduciary of the Company or any other Enterprise, the Company waives any right of contribution or subrogation against the Secondary Indemnitors with respect to the liabilities for which the Company is primarily responsible under this Section 15. In the event of any payment by the Secondary Indemnitors of amounts otherwise required to be indemnified or advanced by the Company under the Company’s memorandum and articles of association or this Agreement, the Secondary Indemnitors shall be subrogated to the extent of such payment to all of the rights of recovery

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of Indemnitee for indemnification or advancement of expenses under the Company’s memorandum and articles of association or this Agreement or, to the extent such subrogation is unavailable and contribution is found to be the applicable remedy, shall have a right of contribution with respect to the amounts paid; provided, however, that the foregoing sentence will be deemed void if and to the extent that it would violate any applicable insurance policy. The Secondary Indemnitors are express third-party beneficiaries of the terms of this Section 15.

16. No Duplication of Payments. Subject to any subrogation rights set forth in Section 15, the Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable hereunder (or for which advancement is provided hereunder) if and to the extent that Indemnitee has otherwise actually received payment for such amounts under any insurance policy, contract, agreement or otherwise.

17. Insurance. To the extent that the Company maintains an insurance policy or policies providing liability insurance for directors, trustees, general partners, managing members, officers, employees, agents or fiduciaries of the Company or any other Enterprise, Indemnitee shall be covered by such policy or policies to the same extent as the most favorably-insured persons under such policy or policies in a comparable position.

18. Subrogation. In the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.

19. Services to the Company. Indemnitee agrees to serve as a director or officer of the Company or, at the request of the Company, as a director, trustee, general partner, managing member, officer, employee, agent or fiduciary of another Enterprise, for so long as Indemnitee is duly elected or appointed or until Indemnitee tenders his or her resignation or is removed from such position. Indemnitee may at any time and for any reason resign from such position (subject to any other contractual obligation or any obligation imposed by operation of law). This Agreement shall not be deemed an employment contract between the Company (or any of its Subsidiaries or any Enterprise) and Indemnitee. Indemnitee specifically acknowledges that any employment with the Company (or any of its Subsidiaries or any Enterprise) is at will, and Indemnitee may be discharged at any time for any reason, with or without cause, with or without notice, except as may be otherwise expressly provided in any executed, written employment contract between Indemnitee and the Company (or any of its Subsidiaries or any Enterprise), any existing formal severance policies adopted by the Company’s board of directors or, with respect to service as a director or officer of the Company, the Company’s memorandum and articles of association or BVI Law. No such document shall be subject to any oral modification thereof.

20. Duration. This Agreement shall continue until and terminate upon the later of (a) ten years after the date that Indemnitee shall have ceased to serve as a director or officer of the Company a Subsidiary, or as a director, trustee, general partner, managing member, officer, employee, agent or fiduciary of any other Enterprise, as applicable; or (b) one year after the final termination of any Proceeding, including any appeal, then pending in respect of which Indemnitee is granted rights of indemnification or advancement of Expenses hereunder and of any proceeding commenced by Indemnitee pursuant to Section 12 of this Agreement relating thereto.

21. Successors. This Agreement shall be binding upon the Company and its successors and assigns, including any direct or indirect successor, by purchase, merger, consolidation or otherwise, to all

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or substantially all of the business or assets of the Company, and shall inure to the benefit of Indemnitee and Indemnitee’s heirs, executors and administrators. The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Company, by written agreement, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.

22. Severability. Nothing in this Agreement is intended to require or shall be construed as requiring the Company to do or fail to do any act in violation of applicable law. The Company’s inability, pursuant to court order or other applicable law, to perform its obligations under this Agreement shall not constitute a breach of this Agreement. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (i) the validity, legality and enforceability of the remaining provisions of this Agreement (including without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (ii) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (iii) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

23. Enforcement. The Company expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director or officer of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving as a director or officer of the Company.

24. Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof; provided , however , that this Agreement is a supplement to and in furtherance of the Company’s obligations to Indemnitee as provided by its memorandum and articles of association, and by applicable law.

25. Modification and Waiver. No supplement, modification or amendment to this Agreement shall be binding unless executed in writing by the parties hereto. No amendment, alteration or repeal of this Agreement shall adversely affect any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in his or her Corporate Status prior to such amendment, alteration or repeal. No waiver of any of the provisions of this Agreement shall constitute or be deemed a waiver of any other provision of this Agreement nor shall any waiver constitute a continuing waiver.

26. Notices. All notices and other communications required or permitted hereunder shall be in writing and shall be mailed by registered or certified mail, postage prepaid, sent by facsimile or electronic mail or otherwise delivered by hand, messenger or courier service addressed:

(a) if to Indemnitee, to Indemnitee’s address, facsimile number or electronic mail address as shown on the signature page of this Agreement or in the Company’s records, as may be updated in accordance with the provisions hereof; or

(b) if to the Company, to the attention of the Chief Executive Officer or Chief Financial Officer of the Company at Establishment Labs Holdings Inc., Coyol Free Zone, Building B15, Alajuela,

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20113, Costa Rica, or at such other current address as the Company shall have furnished to Indemnitee, with a copy (which shall not constitute notice) to Elton Satusky at Wilson Sonsini Goodrich & Rosati, P.C., 650 Page Mill Road, Palo Alto, California 94304.

Each such notice or other communication shall for all purposes of this Agreement be treated as effective or having been given (i) if delivered by hand, messenger or courier service, when delivered (or if sent via a nationally-recognized overnight courier service, freight prepaid, specifying next-business-day delivery, one business day after deposit with the courier), or (ii) if sent via mail, at the earlier of its receipt or five days after the same has been deposited in a regularly-maintained receptacle for the deposit of the United States mail, addressed and mailed as aforesaid, or (iii) if sent via facsimile, upon confirmation of facsimile transfer or, if sent via electronic mail, upon confirmation of delivery when directed to the relevant electronic mail address, if sent during normal business hours of the recipient, or if not sent during normal business hours of the recipient, then on the recipient’s next business day.

27. Applicable Law and Consent to Jurisdiction. This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the British Virgin Islands, without regard to its conflict of laws rules. The Company and Indemnitee hereby irrevocably and unconditionally (i) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the courts of the British Virgin Islands, (ii) consent to submit to the exclusive jurisdiction of the courts of the British Virgin Islands for purposes of any action or proceeding arising out of or in connection with this Agreement, (iii) appoint, to the extent such party is not otherwise subject to service of process in the British Virgin Islands, Conyers Trust Company (BVI) Limited, Incorporation Services, Ltd. as its agent for acceptance of legal process in connection with any such action or proceeding against such party, (iv) waive any objection to the laying of venue of any such action or proceeding in the courts of the British Virgin Islands.

28. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement. This Agreement may also be executed and delivered by facsimile signature and in counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement. Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.

29. Captions. The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.

( signature page follows )

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The parties are signing this Indemnification Agreement as of the date stated in the introductory sentence.

ESTABLISHMENT LABS HOLDINGS INC.

( Signature )

( Print name )

( Title )

[ INSERT INDEMNITEE NAME ]

( Signature )

( Print name )

( Street address )

( City, State and ZIP )

Exhibit 10.2

ESTABLISHMENT LABS HOLDINGS INC.

2015 Equity Incentive Plan

(Adopted as of December 10, 2015)

1. Purpose . Establishment Labs Holdings Inc. 2015 Equity Incentive Plan (the “ Plan ”), is intended to provide incentives which will attract and retain highly competent persons as officers, directors, key employees and independent contractors of Establishment Labs Holdings Inc., a British Virgin Islands corporation (“ Company ”), and its subsidiaries and affiliates, by providing them opportunities to acquire Class A Ordinary Shares, $1.00 par value per share, of the Company (“ Class A Ordinary Shares ”) or to receive monetary payments based on the value of such shares pursuant to the Awards (as defined below) described herein.

2. Participants . Participants will consist of such officers, key employees, directors, advisors, consultants and independent contractors of the Company and its subsidiaries and affiliates, as the Company’s Board of Directors (“ Board ”), in its sole discretion, determine to be significantly responsible for the success and future growth and profitability of the Company and its subsidiaries and affiliates and whom the Board may designate from time to time to receive Awards under the Plan (“ Participants ”). Designation of a Participant in any year shall not require the Board to designate such person to receive an Award in any other year or, once designated, to receive the same type or amount of Awards as granted to the Participant or any other Participant in any year. The Board shall consider such factors as it deems pertinent in selecting Participants and in determining the amount, type and terms and conditions of their respective Awards. At the Board’s discretion, the Board may delegate to the Committee (as defined below), the authority to designate and select Participants and types of Awards.

3. Administration .

(a) Except for those powers expressly reserved for the Board, the Plan will be administered by the Compensation Committee of the Board or any subcommittee thereof appointed by the Board to administer the Plan or, if no committee is appointed to administer the Plan, the Board (the “ Committee ”). The Committee is authorized, subject to the provisions of the Plan, to establish such rules and regulations as it deems necessary or appropriate for the proper administration of the Plan and to make such determinations and interpretations and to take such action in connection with the Plan and any Awards granted hereunder as it deems necessary or advisable. All determinations and interpretations made by the Committee shall be binding and conclusive on all Participants and their legal representatives. No member of the Board, and no employee of the Company shall be liable for any act or failure to act hereunder, by any other Board member or employee or by any agent to whom duties in connection with the administration of this Plan have been delegated or, except in circumstances involving his bad faith, gross negligence or fraud, for any act or failure to act by the member or employee.

(b) The Committee may delegate to one or more of its members or to one or more officers of the Company, or to one or more agents or advisors, such administrative duties or powers as it may deem advisable, and the Committee, or any person to whom duties or powers have been delegated as aforesaid, may employ one or more persons to render advice with respect

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to any responsibility the Committee or such person may have under the Plan. If administration is delegated by the Committee to any such person, as described above, the Committee may terminate all or any portion of such person’s authority under the Plan at any time and revisit in the Committee all or any portion of the administration of the Plan.

4. Types of Awards . Awards under the Plan may be granted in any one or a combination of (i) Share Options, (ii) Equity Appreciation Rights, (iii) Restricted Shares and Restricted Share Units, (iv) Performance Awards and (v) Other Share-Based Awards, each as described below (collectively, “ Awards ”). Each Award shall be made pursuant to a written agreement, certificate, resolution, or such other evidence approved by the Committee that sets forth the terms and conditions of the Awards granted.

5. Shares Reserved under the Plan .

(a) Subject to adjustment under Section 12 hereof, there is hereby reserved for issuance under the Plan 731,873 Class A Ordinary Shares, which may be authorized but unissued or treasury shares. All shares available under the Plan are available for each type of Award under the Plan.

(b) If there is a lapse, expiration, termination or cancellation of any Share Option granted under this Plan prior to the issuance of shares in connection with such option, or if shares are issued under the Plan in connection with an Award hereunder and thereafter such shares are reacquired by the Company, those shares may again be used for new Awards under the Plan. In addition, any shares exchanged or surrendered by a Participant as full or partial payment of the exercise price under any Share Option exercised under this Plan, any shares retained by the Company pursuant to a Participant’s tax withholding election, and any shares covered by an Award which is settled in cash, shall be added back to the shares available for Awards under the Plan. The Board shall determine the appropriate methodology for calculating the number of Shares available for issuance pursuant to the Plan.

(c) The Committee may grant Awards under the Plan in substitution for share and share based awards held by employees, directors, consultants or advisors of another company (an “ Acquired Company ”) in connection with a merger, consolidation or similar transaction involving such Acquired Company and the Company or an Affiliate, or the acquisition by the Company or an Affiliate of property or stock of the Acquired Company. Notwithstanding any other provision of this Plan, the Committee may direct that substitute Awards be granted on such terms and conditions as the Committee considers appropriate in the circumstances. For purposes of this Plan, an “ Affiliate ” means an entity in which the Company has a direct or indirect equity interest, whether now or hereafter existing; provided however, that with respect to an Incentive Share Option, an Affiliate means a “parent corporation” (as defined in Section 424(e) of the Internal Revenue Code of 1986, as amended (the “ Code ”) or a “subsidiary corporation” (as defined in Code Section 424(f)) with respect to the Company, whether now or hereafter existing.

6. Share Options . “ Share Options ” will consist of Awards from the Company, which will enable the holder to purchase a specific number of Class A Ordinary Shares, at set

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terms and at a fixed purchase price. Share Options may be incentive share options within the meaning of Code Section 422 (“ Incentive Share Options ”) or Share Options that do not constitute Incentive Share Options (“ Nonqualified Share Options ”). The Committee will have the authority to grant to any Participant one or more Incentive Share Options, Nonqualified Share Options, or both types of Share Options. Each Share Option shall be evidenced by a written option agreement in such form and shall be subject to such terms and conditions as the Committee may approve from time to time, including without limitation the following:

(a) Exercise Price . Each Share Option granted hereunder shall have such per share exercise price as the Committee may determine at the Date of Grant; provided, however, that other than in the case of a permitted substitution of Share Options under Section 5(c) hereof, the per share exercise price for any Share Options awarded hereunder shall not be less than 100% of the Fair Market Value of the Class A Ordinary Shares on the date the Share Option is granted.

(b) Payment of Exercise Price . The Committee shall determine the acceptable form of consideration for exercising a Share Option, including the method of payment. In the case of an Incentive Share Option, the Committee shall determine the acceptable form of consideration at the time of grant. To the extent approved by the Committee in its discretion and as set out in the applicable Award agreement, the exercise price of a Share Option may be paid (i) in United States dollars in cash or by check; (ii) through delivery of Class A Ordinary Shares then owned by the Participant having a Fair Market Value equal, as of the date of exercise, to the exercise price of the Share Option; (iii) by having the Company retain from the Class A Ordinary Shares otherwise issuable upon exercise of the Share Option, a number of shares having a Fair Market Value equal, as of the date of exercise, to the exercise price of the Share Option (a “net-exercise”); (iv) payment of such other lawful consideration as the Committee may determine in its sole discretion; or (v) by any combination of (i), (ii), (iii) and (iv) above. Notwithstanding the foregoing, the Committee shall accept only such payment on exercise of an Incentive Share Option as is permitted by Code Section 422.

(c) Exercise Period . Share Options granted under the Plan shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Committee; provided, however, that Incentive Share Options shall not be exercisable more than 10 years after the date they are granted. All Share Options shall terminate at such earlier times and upon such conditions or circumstances as the Committee shall in its sole discretion set forth in the option agreement at the Date of Grant, including but not limited to limitations on exercisability following termination of the Participant’s employment or consulting relationship.

(d) Limitations on Incentive Share Options . Incentive Share Options may be granted only to Participants who are employees of the Company or one of its subsidiaries (within the meaning of Code Section 424(f)) at the Date of Grant. The aggregate Fair Market Value (determined as of the time the option is granted) of the Class A Ordinary Shares with respect to which Incentive Share Options are exercisable for the first time by a Participant during any calendar year (under all option plans of the Company) shall not exceed $100,000. Incentive Share Options may not be granted to any Participant who, at the time of grant, owns stock possessing (after the application of the attribution rules of Code Section 424(d)) more than 10%

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of the total combined voting power of all classes of stock of the Company, unless the option price is fixed at not less than 110% of the Fair Market Value of the Class A Ordinary Shares on the Date of Grant and the exercise of such option is prohibited by its terms after the expiration of five years from the Date of Grant of such option.

(e) Redesignation as Nonqualified Share Options . Share Options designated as Incentive Share Options that fail to meet the requirements of Code Section 422 shall be redesignated as Nonqualified Share Options automatically without further action by the Committee on the date of such failure to meet the requirements of Code Section 422.

(f) Termination of Employment or Service Provider Relationship . Unless otherwise provided by the Committee and set forth in the Award, in the event a Participant’s employment or service, as applicable, is terminated before exercise of a vested Share Option, unless otherwise required by law, such Share Options will be held subject to Section 11; provided that the time periods for exercising Incentive Share Options shall be as prescribed by the Code. If the Committee determines, subsequent to a Participant’s termination of employment or service, as applicable, but before exercise of a Share Option, that either before or after the Participant’s termination of employment or service, as applicable, the Participant engaged in conduct that constitutes “Cause,” then the Participant’s right to exercise any Option shall be forfeited immediately.

(g) Limitation of Rights in Shares . The recipient of a Share Option shall not be deemed for any purpose to be a shareholder of the Company with respect to any of the shares subject thereto except to the extent that the Share Option shall have been exercised and, in addition, a certificate shall have been issued and delivered to the Participant.

(h) “ Cause ”, as used in connection with the termination of a Participant’s employment or service, is defined in any employment agreement between the Company and such Participant, or in the absence of any such employment agreement, means: [(1) an unauthorized use or disclosure by the Participant of the Company’s confidential information or trade secrets, which use or disclosure causes material harm to the Company; (2) a material breach by the Participant of any agreement between the Participant and the Company and the Participant fails to remedy such condition within ten (10) days of such breach; (3) a material failure by the Participant to comply with the Company’s written policies or rules and the Participant fails to remedy such non-compliance within ten (10)) days of such failure to comply; (4) the Participant’s violation of a federal or state law or regulation directly or indirectly applicable to the business of the Company or its affiliates, which violation was or is reasonably likely to be injurious to the Company or its affiliates; (5) the Participant’s (i) conviction of, or plea of “guilty” or “no contest” to, a felony under the laws of the United States or any State thereof or (ii) committing of any act of moral turpitude, dishonesty or fraud against, or the misappropriation of material property belonging to, the Company or its affiliates; (6) the Participant’s gross negligence or willful misconduct that was or is or is likely to be materially injurious to the Company or its affiliates; (7) a continuing failure by the Participant to perform assigned duties after receiving written notification of such failure from the Board and the Participant fails to remedy such

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condition within ten (10) days after receiving such written notification; or (h) a failure by the Participant to cooperate in good faith with a governmental or internal investigation of the Company or its directors, officers or employees, if the Company has requested the Participant’s cooperation] .

7. Equity Appreciation Rights . “ Equity Appreciation Rights ” will consist of Awards from the Company, which will entitle the holder to receive a payment based on the appreciation in the Fair Market Value of the shares subject thereto up to a specified date or dates. The Committee may, in its discretion, grant Equity Appreciation Rights to the holders of any Share Options granted hereunder. In addition, Equity Appreciation Rights may be granted independently of and without relation to Share Options. Each Equity Appreciation Right shall be subject to such terms and conditions consistent with the Plan as the Committee shall impose from time to time, including the following:

(a) Each Equity Appreciation Right will entitle the holder to receive the appreciation in the Fair Market Value of the Class A Ordinary Shares referenced therein up to the date the right is subject to a payout event. In the case of a right issued in relation to a Share Option, such appreciation shall be measured from not less than the exercise price of such Share Option and in the case of a right issued independently of any Share Option, such appreciation shall be measured from the applicable strike price specified by the Committee in the applicable Award agreement relating to any such Equity Appreciation Right.

(b) Each Equity Appreciation Right will be payable at such time or times following the first to occur of the applicable payout event(s) as set forth by the Committee in the applicable Award agreement. Payment of such appreciation shall be made in cash or in Class A Ordinary Shares, or a combination thereof, as determined by the Committee.

8. Restricted Shares and Restricted Share Units .

(a) “ Restricted Shares ” will consist of Awards of Class A Ordinary Shares to Participants either with or without consideration therefor from Participants. Each Award of Restricted Shares shall be subject to such terms and conditions as the Committee determines appropriate, including, without limitation, restrictions on the sale or other disposition of shares, restrictions requiring the forfeiture of shares to the Company upon termination of the Participant’s employment or service with the Company or one of its Affiliates prior to satisfying a prescribed period of service. In the case of an Award of Restricted Shares, the Committee may require the Participant to deliver a duly signed share power, endorsed in blank, relating to the shares covered by such an Award, and may also require that the share certificates evidencing such shares be held in custody until the service restrictions thereon shall have lapsed.

Each Restricted Share Award involving actual Class A Ordinary Shares shall specify whether the Participant shall have, with respect to the Class A Ordinary Shares subject thereto, all of the rights of a holder of Class A Ordinary Shares of the Company, including the right to receive dividends, if applicable, and to vote the shares.

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(b) “ Restricted Share Units ” will consist of Awards that entitle the Participant to receive Class A Ordinary Shares and/or cash after a prescribed period of service. The period of service, number of reference Class A Ordinary Shares, and other conditions and limitations applicable to each Award of Restricted Share Units shall be as determined by the Committee and shall be stated in the applicable Award agreement. The Committee, in its sole discretion, may impose such other restrictions on Restricted Share Units as it may deem advisable or appropriate including, without limitation, restrictions requiring the forfeiture of Restricted Share Units to the Company upon termination of the Participant’s employment or service with the Company or one of its Affiliates prior to satisfying the prescribed period of service.

9. Other Share-Based Awards . “ Other Share-Based Awards ” will consist of other types of equity-based or equity-related Awards not otherwise described by the terms of the Plan in such amounts and subject to such terms and conditions, as the Board or the Committee shall determine. Such Awards may involve the transfer of actual Class A Ordinary Shares, or payment in cash or otherwise of amounts based on the value of Class A Ordinary Shares.

10. Performance Awards .

(a) “ Performance Awards ” will consist of Awards for which the Committee has set performance goals at its discretion which, depending on the extent to which they are met, will determine the number of Class A Ordinary Shares and/or cash value of Awards that will be paid out to the Participants. Performance Awards may be granted to Participants at any time and from time to time, as shall be determined by the Committee. The Committee shall have complete discretion in determining the number, amount and timing of Performance Awards granted to each Participant. Performance Awards may take such form as may be determined by the Committee, including without limitation, cash, Share Options, Awards of Class A Ordinary Shares, Awards of Restricted Shares or Restricted Share Units, Other Share-Based Awards or any combination thereof. Performance Awards may be awarded as short-term or long-term incentives.

(b) Performance Awards under the Plan may be made subject to the attainment of one or more of the specified performance goals, as determined by the Committee in its sole discretion. Performance goals may be based upon Company-wide, Affiliate, divisional, project team, and/or individual performance. The Board or the Committee shall have the authority at any time to make adjustments to performance goals for any outstanding Performance Awards which the Board or the Committee deems necessary or desirable unless at the time of establishment of such goals the Board or the Committee shall have precluded its authority to make such adjustments.

(c) Payment of earned Performance Awards shall be made in accordance with terms and conditions prescribed by the Committee. Performance Awards shall payable in cash or in Class A Ordinary Shares, or a combination thereof, as determined by the Committee.

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11. Effect of Termination of Service on Awards; Forfeiture .

(a) The Committee may provide, by rule or regulation or in any Award, or may determine in any individual case, the circumstances in which Awards shall be exercised, vested, paid or forfeited in the event a Participant ceases to be an employee, director or other service provider prior to the end of a performance period, period of restriction or the exercise, vesting or settlement of such Award. Unless otherwise determined by the Committee if, with respect to any Award, (1) Participant’s termination of employment or service, as applicable, occurs before the end of the period of restriction or the vesting date applicable to such Award (or the applicable portion of such Award) or (2) any performance goals are not achieved in whole or in part (as determined by the Committee) by the end of the period for measuring such performance goals, then all such then unvested and/or unearned Awards shall be forfeited by the Participant.

(b) Awards under the Plan shall not be affected by the change of a Participant’s status within or among the Company and any subsidiaries or Affiliates, so long as the Participant remains an employee, officer, director or other service provider. For purposes of the Plan and any Award hereunder, if an entity that the Participant is employed by or otherwise providing services to ceases to be a subsidiary or an Affiliate, a Participant shall be deemed to terminated employment or service, as applicable, on the date of the entity’s change in status, unless the Participant continues as an employee or service provider in respect of the Company or another subsidiary or Affiliate (after giving effect to the change in status).

12. Adjustment Provisions .

(a) If the Company shall at any time change the number of Class A Ordinary Shares issued without new consideration to the Company (such as by share dividend or share split), the total number of Class A Ordinary Shares reserved for issuance under the Plan, the maximum number of Class A Ordinary Shares which may be made subject to Incentive Share Options during the term of the Plan, and the number of Class A Ordinary Shares covered by each then outstanding Award shall be equitably adjusted and the aggregate consideration payable to the Company, if any, shall not be changed.

(b) Unless otherwise provided in Section 13, in the event of any merger, consolidation or reorganization of the Company with or into another entity other than a merger, consolidation or reorganization in which the Company is the continuing entity and which does not result in the outstanding Class A Ordinary Shares being converted into or exchanged for different securities, cash or other property, or any combination thereof, there may be substituted, on an equitable basis as determined by the Committee, for each Class A Ordinary Share then subject to an Award under the Plan, the number and kind of shares, other securities, cash or other property to which holders of Class A Ordinary Shares of the Company will be entitled pursuant to the transaction.

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13. Change of Control of the Company; Consequences of a Change of Control .

(a) Unless otherwise expressly provided in the applicable Award agreement, upon the occurrence of a Change of Control of the Company, the Board or the Committee may (1) provide for the acceleration of vesting or to cause the lapse of restrictions with respect to, all or any portion of an Award, (2) cancel an Award for a cash payment equal to the Fair Market Value (as determined in the sole discretion of the Board) which, in the case of Share Options and Equity Appreciation Rights, shall be deemed to be equal to the excess, if any, of the value of the consideration to be paid in the Change of Control transaction to holders of the same number of Class A Ordinary Shares subject to such Share Options or Equity Appreciation Rights (or, if no consideration is paid in any such transaction, the Fair Market Value of the Class A Ordinary Shares subject to such Share Options or Equity Appreciation Rights) over the aggregate exercise price (in the case of Share Options) or strike price (in the case of Equity Appreciation Rights), (3) provide for the issuance of a substitute Award that will substantially preserve the otherwise applicable terms of any affected Award previously granted hereunder as determined by the Board in its sole discretion, (4) take any other action with respect to the Awards the Board or the Committee deems appropriate. For the avoidance of doubt, the treatment of Awards upon a Change of Control of the Company may vary among the Award types and Participants in the sole discretion of the Board. Unless otherwise determined by the Board (on the same basis or on different bases as the Board shall specify), any repurchase rights or other rights of the Company that relate to an Award shall continue to apply to consideration, including cash, that has been substituted, assumed or amended for an Award pursuant to this Section 13(a). The Company may hold in escrow all or any portion of any such consideration in order to effectuate any continuing restrictions.

(b) For purposes of this Plan, a “ Change of Control ” of the Company shall mean: the acquisition of the Company by another entity by means of any transaction or series of related transactions (including, without limitation, any reorganization, merger or consolidation or share transfer, but excluding any such transaction effected primarily for the purpose of changing the domicile of the Company or a bona-fide financing of the Company), unless the Company’s shareholders of record immediately prior to such transaction or series of related transactions hold, immediately after such transaction or series of related transactions, at least 50% of the voting power of the surviving or acquiring entity (provided that the sale by the Company of its securities for the purposes of raising additional funds shall not constitute a Change of Control hereunder); or a sale of all or substantially all of the assets of the Company.

Notwithstanding the foregoing, a Change of Control of the Company shall not be deemed to have occurred under Section 13 solely because (1) the Company, (2) an Affiliate or Initial Shareholders, (3) any one or more members of executive management of the Company or its subsidiaries, (4) any employee share ownership plan or any other employee benefit plan of the Company or any Affiliate or (5) any combination of the Persons referred to in the preceding clauses (1) through (4) becomes the actual or beneficial owner (within the meaning of rule 13d-3 promulgated under the Securities Exchange Act of 1934 (the “ Exchange Act ”)) of 50% or more of the Voting Securities of the Company.

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(c) In the event that a payment or delivery of an Award following a Change of Control would not be a permissible distribution event, as defined in Code Section 409A(a)(2) or any regulations or other guidance issued thereunder, then the payment or delivery shall be made on the earlier of (i) the date of payment or delivery originally provided for such benefit or (ii) the date of termination of the Participant’s employment or service with the Company or one of its Affiliates (or six months after such termination in the case of a “specified employee” as provided in Section 18(c) hereof).

(d) As used in this Section 13, the following terms shall have the meanings set forth below:

“ Initial Shareholders ” means the shareholders of the Company immediately prior to any transaction which may constitute a Change of Control.

“ Person ” means any individual, corporation, partnership, group, association or other “person,” as such term is used in section 14(d) of the Exchange Act.

“ Voting Securities ” means, with respect to any Person, any securities entitled to vote (including by the execution of action by written consent) generally in the election of directors of such Person (together with direct or indirect options or other rights to acquire any such securities).

14. Nontransferability . Unless otherwise set forth in the applicable written Award agreement, each Award granted under the Plan shall not be transferable otherwise than by will or the laws of descent and distribution, and shall be exercisable, during the Participant’s lifetime, only by the Participant or, in the event of a Participant’s disability, by the Participant’s personal representative. In the event of the death of a Participant, exercise of any Award or payment with respect to any Award shall be made only by or to the executor or administrator of the estate of the deceased Participant or the person or persons to whom the deceased Participant’s rights under the benefit shall pass by will or the laws of descent and distribution. Notwithstanding the foregoing, at the discretion of the Committee, a grant of a Share Option may permit the transfer thereof by the Participant solely to members of the Participant’s immediate family or trusts or family partnerships or limited liability companies for the benefit of such persons, subject to such terms and conditions as may be established by the Committee.

15. Repurchase of Shares .

(a) Upon any termination of a Participant’s employment or service with the Company or a subsidiary or Affiliate, unless otherwise provided in the Award, the Company will be entitled (in its sole and absolute discretion) to repurchase at the Company’s election all or any of the Class A Ordinary Shares received hereunder or acquired upon exercise of a grant held by a Participant (whether or not previously acquired by the Participant in connection with the exercise of a Share Option or Equity Appreciation Right or upon settlement of any other Award and including any Class A Ordinary Shares received as a result of the exercise of any Award after the Participant’s termination date) (the “ Repurchase Option ”). If the Company elects to exercise the Repurchase Option with respect to Shares held by any Participant pursuant to this Section 15, it

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shall deliver written notice (the “ Repurchase Notice ”) to such Participant to such effect within 90-days after the occurrence of the event giving rise to the Repurchase Option. For the avoidance of doubt, this Repurchase Option does not apply to Class A Ordinary Shares purchased by or granted to a Participant under an agreement that is not part of this Plan.

(b) The repurchase price (the “ Repurchase Price ”) for a Participant’s Class A Ordinary Shares to be repurchased (the “ Surrendered Securities ”) shall be the Fair Market Value of such Surrendered Securities on the date of termination of employment or service; provided that in the case of a termination of a Participant’s employment or service by the Company for Cause, the Repurchase Price shall be the lesser of the Fair Market Value of the Surrendered Securities on the date of termination of employment or service and the original exercise price (or other amount paid with respect to an Award, if any, in the case of Awards other than Share Options and Equity Appreciation Rights) paid for such Surrendered Securities or the Fair Market Value of such Surrendered Securities on the original date of purchase, as applicable.

(c) (1) Within ten (10) business days after the Repurchase Price for the Surrendered Securities has been determined, the Company shall send a notice to such holder of the Surrendered Securities setting forth the consideration to be paid for such securities and the time and place for the closing of the transaction, which date shall not be more than twenty (20) days nor less than five (5) days after the delivery of such notice. At such closing, the holder of the Surrendered Securities shall deliver all certificates (if any exist) evidencing the Surrendered Securities to be repurchased to the Company, and the Company shall pay for the Surrendered Securities to be repurchased pursuant to the Repurchase Option by delivery of a check or wire transfer in the aggregate amount of the Repurchase Price for such securities.

(2) The Company shall be entitled to receive customary representations and warranties from such holder that he or she is the record and beneficial owner of the Surrendered Securities free and clear of any liens, and that he or she will transfer and deliver valid title to such securities free and clear of any liens.

(d) Notwithstanding anything to the contrary contained in this Plan, all repurchases of Surrendered Securities by the Company shall be subject to applicable state and federal laws and regulations and, to the extent applicable, the Company’s debt and equity financing agreements. If any of the foregoing prohibits (in the discretion of the Company) the repurchase of Surrendered Securities which are otherwise permitted or required hereunder, the time periods provided in this Section 15 (other than the time period for delivery of the notice in Section 15(a)) shall be suspended, and the Company may make such repurchases as soon as it is permitted to do so under such restrictions; provided that, notwithstanding the foregoing, in no event shall the time periods provided in this Section 15 be suspended for more than three (3) months and that the Company shall in any event have formally notified Participant in writing of its election to repurchase within the time period specified in Section 15(a).

(e) In the event the Company delivers a Repurchase Notice to a Participant but does not elect to repurchase all Shares held by such Participant, the Shares held by such

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Participant which the Company has not elected to repurchase in the Repurchase Notice shall no longer be subject to the Repurchase Option.

16. Other Provisions . Awards under the Plan may also be subject to such other provisions (whether or not applicable to the Award granted to any other Participant) as the Committee determines appropriate, including without limitation, provisions to assist the Participant in financing the acquisition of Class A Ordinary Shares, provisions for the acceleration of exercisability or vesting and/or early termination of Awards in the event of a Change of Control of the Company, provisions for the payment of the value of Awards to Participants in the event of a Change of Control of the Company, provisions relating to treatment of Awards upon an offering of Company equity on a national securities exchange, provisions for the forfeiture of, or restrictions on resale or other disposition of, Class A Ordinary Shares acquired under any form of Award, provisions to comply with Federal and State securities laws, or understandings or conditions as to the Participant’s employment in addition to those specifically provided for under the Plan.

17. Time of Granting of Awards; Fair Market Value . The date of grant (“ Date of Grant ”) of an Award shall be the date specified by the Committee on which an Award under this Plan will become effective (which date shall in no event be earlier than the date on which the Committee takes action with respect thereto), provided that in the case of an Incentive Share Option, the Date of Grant shall be the later of the date on which the Committee makes the determination granting such Incentive Share Option or the date of commencement of the Participant's employment relationship with the Company or one of its Affiliates. Except as otherwise expressly provided in a written Award, for purposes of this Plan and any Awards hereunder, “ Fair Market Value ” shall mean the amount determined in good faith by the Committee as the fair market value of shares of the Company on such basis as it deems appropriate taking into account, if applicable, the requirements of Section 409A of the Code.

18. Tenure . A Participant’s right, if any, to continue to serve the Company as an officer, employee, or otherwise, shall not be enlarged or otherwise affected by his or her designation as a Participant under the Plan, nor shall this Plan in any way interfere with the right of the Company, subject to the terms of any separate employment agreement to the contrary, at any time to terminate such employment or to increase or decrease the compensation of the Participant from the rate in existence at the time of the grant of an Award.

19. Withholding . All payments or distributions made pursuant to the Plan shall be net of any amounts required to be withheld pursuant to applicable federal, state and local tax withholding requirements. If the Company proposes or is required to distribute Class A Ordinary Shares pursuant to the Plan, it may require the recipient to remit to it an amount sufficient to satisfy such tax withholding requirements prior to the delivery of any certificates for such Class A Ordinary Shares. The Committee may, in its sole discretion and subject to such rules as it may adopt, permit an Award holder to pay all or a portion of the minimum required federal, state and local withholding taxes arising in connection with (a) a Share Option or an Equity Appreciation Right or (b) the receipt or vesting of a Restricted Share Award or a Performance

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Award, by electing to have the Company withhold Class A Ordinary Shares having a Fair Market Value equal to the amount to be withheld.

20. Code Section 409A . The Plan is intended to be administered in a manner so that awards thereunder are exempt from Section 409A. For avoidance of doubt, Share Options and Equity Appreciation Rights are intended to qualify for the stock rights exemptions from Section 409A of the Code (“ Section 409A ”). Where reasonably possible and practicable, the Plan shall be administered in a manner to avoid the imposition on Participants of immediate tax recognition and additional taxes pursuant to such Section 409A. Notwithstanding the foregoing, neither the Company nor the Committee shall have any liability to any person in the event Section 409A applies to any such Award in a manner that results in adverse tax consequences for the Participant or any of his or her transferees.

21. Duration, Amendment and Termination . This Plan shall terminate upon the earlier of a termination by the Board, or at such time as there shall be no remaining shares available for grant hereunder, or ten-year anniversary of effective date. Also, by mutual agreement between the Company and a Participant hereunder, under this Plan or under any other present or future plan of the Company, Awards may be granted to such Participant in substitution and exchange for, and in cancellation of, any Awards previously granted such Participant under this Plan, or any other present or future plan of the Company. The Board may amend the Plan from time to time or terminate the Plan at any time, subject to any requirement of shareholder approval required by applicable law, regulation, or stock exchange rule.

22. Governing Law . This Plan and actions taken in connection herewith shall be governed and construed in accordance with the laws of the British Virgin Islands.

23. Shareholder Approval . The Plan was adopted by the Board on December 10, 2015.

24. Shareholder Agreements . Notwithstanding anything to the contrary herein, it shall be a condition to the receipt of any Class A Ordinary Shares of the Company hereunder that the Participant executes the Company’s shareholder agreements or similar agreements, each as amended from time to time, as required by the Company, the Board or the Committee. In the event that the Participant fails to do so, then the Participant’s right to receive any Class A Ordinary Shares of the Company shall be forfeited immediately.

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ESTABLISHMENT LABS HOLDINGS INC.

2015 EQUITY INCENTIVE PLAN

INCENTIVE SHARE OPTION AGREEMENT


1.	Grant of Option .

Establishment Labs Holdings Inc., a British Virgin Islands corporation (the “Company”), hereby grants to __________ (the “Employee”), an option, pursuant to the Establishment Labs Holdings Inc. 2015 Equity Incentive Plan (the “Plan”), to purchase an aggregate of ____Class A Ordinary Shares, $1.00 par value per share, of the Company (“Class A Ordinary Shares”), at a price of $4.11 per share, purchasable as set forth in and subject to the terms and conditions of this option agreement (this “Agreement”) and the Plan. This option is intended to qualify as an incentive stock option (“Incentive Share Option”) within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”). The date of grant of this option is hereinafter referred to as the “date of grant.”


2.	Exercise of Option and Provisions for Termination .

(a) Except as otherwise provided herein and subject to the right of accumulation provided herein, this option may be exercised, prior to the tenth anniversary date, as to not more than the following number of shares covered by this option during the respective periods set forth below:


▪	___________

(b) This option may not be exercised at any time after the tenth anniversary date.

(c) Subject to the conditions hereof, this option shall be exercisable by the Employee giving written notice of exercise to the Company, specifying the number of shares to be purchased and the purchase price to be paid therefor and accompanied by payment in accordance with Section 3 hereof. Such exercise shall be effective upon receipt by the Company of the written notice together with the required payment. The Employee shall be entitled to purchase less than the number of shares covered hereby, provided that no partial exercise of this option shall be for less than 10 whole shares.

(d) Subject to Section 2(e) below, if the Employee ceases to be employed by, and is no longer providing any services (whether as a consultant, advisor, director or in any other capacity) to, the Company or one of its subsidiaries for any reason (and for purposes of this Agreement, while the Employee is an employee of the Company or one of its subsidiaries or is providing services to the Company or a subsidiary of the Company as a consultant, advisor, director or another type of service provider, the Employee will be considered to be in “Service” or providing “Services”) including retirement but other than death or disability and other than a termination from Service for Cause, this option shall immediately terminate; provided , that any portion of this option which was otherwise exercisable on the date of termination of the Employee’s Service may be exercised within the three-month period following the date on which the Employee ceased to provide any Services, but in no event after the tenth anniversary date. Any such exercise may be made only to the extent of the number of shares subject to this option which are purchasable upon the date of

such termination of Service. If the Employee dies during such three-month period, this option shall be exercisable by the Employee’s personal representatives, heirs or legatees to the same extent and during the same period that the Employee could have exercised this option on the date of his or her death.

(e) If the Employee dies while an employee of the Company or any subsidiary of the Company or ceases to be employed by the Company as a result of a disability, this option shall be deemed to be fully vested and shall be exercisable in full, by the Employee or the Employee’s personal representatives, heirs or legatees, as applicable. This option or any unexercised portion hereof shall terminate unless so exercised prior to the earlier of the expiration of twelve months from the date of such death or the tenth anniversary date.

(f) If the Employee’s Service terminates for Cause, the Option will terminate immediately upon such termination of Service and the Employee is prohibited from exercising the Option, whether vested or unvested, at any time after such termination.

(g) If the Employee violates the confidentiality, non-solicit or non-compete obligations applicable to the Employee set forth in a written agreement between the Employee and the Company, the Option will terminate immediately, effective on the date of the Employee’s first violation of such obligations, as determined by the Company, and the Employee is prohibited from exercising the Option, whether vested or unvested, at any time after such date.

(h) Notwithstanding any other provision hereof, this option will be considered a non-qualified or non-statutory option to the extent provided under Section 422(d)(1) of the Code, which provides that the aggregate fair market value (determined at the time the option is granted) of the Class A Ordinary Shares with respect to which incentive share options are exercisable for the first time by the Employee during any calendar year (under all of the plans of the Company, its parent, if any, or its subsidiaries, if any) shall not exceed $100,000.


3.	Payment of Purchase Price .

(a) Payment of the purchase price for shares purchased upon exercise of this option shall be made by delivery to the Company of cash or check payable to the order of the Company in an amount equal to the purchase price of such shares, or, if the Employee elects and the Company permits, by delivery of Class A Ordinary Shares having a fair market value equal in amount to the purchase price of such shares or by entering into a “net exercise” arrangement. Another method of payment may be used if authorized by the Plan and the Company permits.

(b) For the purposes hereof, the fair market value of any Class A Ordinary Share to be delivered to the Company in exercise of this option shall be determined in good faith by the Board of Directors of the Company, in accordance with the terms of the Plan.

(c) If the Employee elects to exercise options by delivery of Class A Ordinary Shares, the certificate or certificates representing the Class A Ordinary Shares to be delivered shall be duly executed in blank by the Employee or shall be accompanied by a share power duly executed in blank suitable for purposes of transferring such shares to the Company. Fractional Class A Ordinary

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Shares will not be accepted in payment of the purchase price of shares acquired upon exercise of this option.


4.	Delivery of Shares .

The Company shall, upon payment of the purchase price for the number of shares purchased and paid for, make prompt delivery of such shares to the Employee, provided that if any law or regulation requires the Company to take any action with respect to such shares before the issuance thereof, then the date of delivery of such shares shall be extended for the period necessary to complete such action. No shares shall be issued and delivered upon exercise of any option unless and until, in the opinion of counsel for the Company, any applicable registration requirements of the Securities Act of 1933 or other applicable law, any applicable listing requirements of any national securities exchange on which stock of the same class is then listed, and any other requirements of law or of any regulatory bodies having jurisdiction over such issuance and delivery, shall have been fully complied with.


5.	Non-transferability of Option .

Except as provided in Sections 2(d), (e), and (f) hereof, this option is personal and no rights granted hereunder shall be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) nor shall any such rights be subject to execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this option or of such rights contrary to the provisions hereof, or upon the levy of any attachment or similar process upon this option or such rights, this option and such rights shall become null and void.


6.	No Special Employment or Service Rights .

Nothing contained in the Plan or this Agreement shall be construed or deemed by any person under any circumstances to bind the Company or any of its subsidiaries to continue the Service of the Employee for the period within which this option may be exercised. However, during the period of the Employee’s Service, the Employee shall render diligently and faithfully the Services which are assigned to the Employee from time to time by the Board of Directors or by the executive officers of the Company and its subsidiaries and shall at no time take any action which directly or indirectly would be inconsistent with the best interests of the Company or of its subsidiaries.


7.	Rights as a Shareholder .

The Employee shall have no rights as a shareholder with respect to any shares which may be purchased by exercise of this option unless and until a certificate or certificates representing such shares are duly issued and delivered to the Employee or until such shares are duly registered in the corresponding shareholders register. Except as otherwise expressly provided in the Plan, no adjustment shall be made for dividends or other rights for which the record date is prior to the date such share certificate is issued.

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8.	Recapitalization .

In the event that dividends are payable in Class A Ordinary Shares or in the event there are splits, sub-divisions or combinations of Class A Ordinary Shares subsequent to the date of grant, the number of shares subject to this option shall be increased or decreased proportionately, as the case may be, and the number of shares deliverable upon the exercise thereafter of this option shall be increased or decreased proportionately, as the case may be, without change in the aggregate purchase price.


9.	Withholding Taxes .

Whenever shares are to be issued upon exercise of this option, the Company shall have the right to require the Employee to remit to the Company an amount sufficient to satisfy any federal, state and local minimum tax withholding requirements prior to the delivery of any certificate or certificates for such shares. Notwithstanding anything to the contrary in this Agreement, the Employee shall be entitled to satisfy any minimum required tax withholding obligations by directing the Company to withhold Class A Ordinary Shares issuable to the Employee upon exercise of the share options under this Agreement.


10.	Qualification under Section 422 .

It is understood and intended that the option granted hereunder shall qualify as an “incentive stock option” as defined in Section 422 of the Code. Accordingly, the Employee understands that in order to obtain the benefits of an incentive stock option under Section 421 of the Code, no sale or other disposition may be made of any shares acquired upon exercise of the option within the one-year period beginning on the day after the day of the transfer of such shares to him or her, nor within the two-year period beginning on the day after the grant of the option. If the Employee intends to dispose or does dispose (whether by sale, exchange, gift, transfer or otherwise) of any such shares within said periods, he or she will notify the Company within 30 days after such disposition.


11.	Company’s Repurchase Right .

All shares purchased upon exercise of the option under this Agreement shall be subject to the Company’s repurchase right as determined under the Plan.


12.	Permitted Transfers .

The Participant may not sell, transfer, pledge, assign or otherwise alienate or hypothecate all or any portion of the option, other than by will or by the laws of descent and distribution. The Company will not be required (i) to transfer on its books all or any portion of the option or Shares that have been sold or transferred, or (ii) to treat as owner of all or any portion of the option or Shares, to accord the right to vote as such owner or to pay distributions, if any, to any transferee to whom all or any portion of the option or Shares have been transferred, in violation of the Plan, this Agreement, or any other of the Company’s shareholder agreements or similar agreements (the “Shareholder Agreements”).

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(a) During the Employee’s lifetime, only the Employee or his or her guardian or legal representative may exercise the option. The Board may, in its discretion, require a guardian or legal representative to supply it with the evidence the Board reasonably deems necessary to establish the authority of the guardian or legal representative to exercise the option on behalf of the Employee or transferee, as the case may be.

(b) Prior to the consummation of a Public Offering, in no event may the Employee sell, transfer or otherwise dispose of a Class A Ordinary Share without the Board's advanced written approval.

(c) Upon an exercise of the option, the Employee shall join in and enter into the Shareholder Agreements with respect to all Class A Ordinary Shares.


13.	Investment Representation, Etc .

(a) The Employee represents that any shares purchased upon exercise of this option shall be acquired by the Employee for his or her own account for investment and not with a view to, or for sale in connection with, any distribution of such shares, nor with any present intention of distributing or selling such shares. By making payment upon exercise of this option, the Employee shall be deemed to have reaffirmed, as of the date of such payment, the representations made in this Section 13.

(b) Upon execution of the Shareholder Agreements by the Employee, the Company shall have affixed to all share certificates representing Class A Ordinary Shares issued to the Employee upon exercise of this option a legend evidencing such agreement.

(c) All share certificates representing Class A Ordinary Shares issued to the Employee upon exercise of this option shall, at the election of the Company, have affixed thereto a legend substantially in the following form:

“The shares of stock represented by this certificate (i) are subject to the restrictions on transfer and a repurchase option, all contained in an Incentive Share Option Agreement between the Company and the holder of this certificate (a copy of which is available without charge from the Company), and (ii) have not been registered under any securities laws and may not be transferred, sold or otherwise disposed of in the absence of an effective registration statement with respect to the shares evidenced by this certificate, filed and made effective under the Securities Act of 1933 or other foreign law, or an opinion of counsel satisfactory to the Company to the effect that registration under such law is not required.”


14.	Miscellaneous .

(a) Except as provided herein, this Agreement may not be amended or otherwise modified unless evidenced in writing and signed by the Company and the Employee.

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(b) All notices under this Agreement shall be mailed or delivered by hand to the parties at their respective addresses set forth beneath their names below or at such other address as may be designated in writing by either of the parties to one another.



Date of Grant	ESTABLISHMENT LABS HOLDING INC.

	By:

	Title:

	Address:	B15 Coyol Free Zone Alajuela, 20113 Costa Rica Attention: Chief Executive Officer

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EMPLOYEE’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.




Signature

Address:

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ESTABLISHMENT LABS HOLDINGS INC.

2015 EQUITY INCENTIVE PLAN

NONQUALIFIED SHARE OPTION AGREEMENT


1.	Grant of Option .

Establishment Labs Holdings Inc., a British Virgin Islands corporation (the “Company”), hereby grants to _______ (the “Optionholder”), an option, pursuant to the Establishment Labs Holdings Inc. 2015 Equity Incentive Plan (the “Plan”), to purchase an aggregate of _____ Class A Ordinary Shares, $1.00 par value per share, of the Company (“Class A Ordinary Shares”), at a price of $[___] per share, purchasable as set forth in and subject to the terms and conditions of this option agreement (this “Agreement”) and the Plan. This option is intended to be a nonqualified stock option. The date of grant of this option is hereinafter referred to as the “date of grant.” Capitalized terms used but not defined herein shall have the meanings set forth in the Plan.

2. Exercise of Option and Provisions for Termination .

(a) Except as otherwise provided herein and subject to the right of cumulation provided herein, this option may be exercised, prior to the Expiration Date (as defined below), as to not more than the following number of shares covered by this option during the respective periods set forth below:

(i) _________ of the Class A Ordinary Shares on _____ (the “First Vesting Date”);

and

(ii) _________ of the Class A Ordinary Shares on ________after the First Vesting

Date.

(b) This option may not be exercised at any time after the [tenth anniversary] of the date of grant (the “Expiration Date”).

(c) Subject to the conditions hereof, this option shall be exercisable by the Optionholder giving written notice of exercise to the Company, specifying the number of shares to be purchased and the purchase price to be paid therefor and accompanied by payment of such purchase price in accordance with Section 3 hereof together with any applicable tax withholding in accordance with Section 9 hereof. Such exercise shall be effective upon receipt by the Company of the written notice together with the required payment. The Optionholder shall be entitled to purchase less than the number of shares covered hereby, provided that no partial exercise of this option shall be for less than 10 whole shares.

(d) Subject to Section 2(e) below, if the Optionholder ceases to be employed by, and is no longer providing any services (whether as a consultant, advisor, director or in any other capacity) to, the Company or one of its subsidiaries or affiliates for any reason (and for purposes of this Agreement, while the Optionholder is an employee of the Company or one of its subsidiaries or affiliates or is providing services to the Company or a subsidiary or affiliate of the Company as a consultant, advisor, director or another type of service provider, the Optionholder will be considered to be in “Service” or providing “Services”) including retirement but other than death or disability and other than a termination from Service for Cause, this option shall immediately terminate;

provided , that any portion of this option which was otherwise exercisable on the date of termination of the Optionholder’s Service may be exercised within the three-month period following the date on which the Optionholder ceased to provide any Services, but in no event after the Expiration Date. Any such exercise may be made only to the extent of the number of shares subject to this option which are purchasable upon the date of such termination of Service. If the Optionholder dies during such three-month period, this option shall be exercisable by the Optionholder’s personal representatives, heirs or legatees to the same extent and during the same period that the Optionholder could have exercised this option on the date of his or her death.

(e) If the Optionholder dies while an Optionholder of the Company or any subsidiary or affiliate of the Company or terminates Service as a result of a disability, this option shall be deemed to be fully vested and shall be exercisable in full, by the Optionholder or the Optionholder’s personal representatives, heirs or legatees, as applicable. This option or any unexercised portion hereof shall terminate unless so exercised prior to the earlier of the expiration of twelve months from the date of such death or the Expiration Date.

(f) If the Optionholder’s Service terminates for Cause, the Option will terminate immediately upon such termination of Service and the Optionholder is prohibited from exercising the Option, whether vested or unvested, at any time after such termination.

(g) [[If the Optionholder violates the confidentiality, non-solicit or non-compete obligations applicable to the Optionholder set forth in a written agreement between the Optionholder and the Company, the Option will terminate immediately, effective on the date of the Optionholder’s first violation of such obligations, as determined by the Company, and the Optionholder is prohibited from exercising the Option, whether vested or unvested, at any time after such date.]]

3. Payment of Purchase Price .

(a) Payment of the purchase price for shares purchased upon exercise of this option shall be made by delivery to the Company of cash or check payable to the order of the Company in an amount equal to the purchase price of such shares, or, if the Optionholder elects and the Company permits, by delivery of Class A Ordinary Shares having a fair market value equal in amount to the purchase price of such shares or by entering into a “net exercise” arrangement. Another method of payment may be used if authorized by the Plan and the Company permits.

(c) If the Optionholder elects to exercise options by delivery of Class A Ordinary Shares, the certificate or certificates representing the Class A Ordinary Shares to be delivered shall be duly executed in blank by the Optionholder or shall be accompanied by a share power duly executed in blank suitable for purposes of transferring such shares to the Company. Fractional Class A Ordinary Shares will not be accepted in payment of the purchase price of shares acquired upon exercise of this option.

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4. Delivery of Shares .

The Company shall, upon payment of (i) the purchase price for the number of shares purchased and paid for and (ii) any applicable tax withholding, make prompt delivery of such shares to the Optionholder, provided that if any law or regulation requires the Company to take any action with respect to such shares before the issuance thereof, then the date of delivery of such shares shall be extended for the period necessary to complete such action. No shares shall be issued and delivered upon exercise of any option unless and until, in the opinion of counsel for the Company, any applicable registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), or other applicable law, any applicable listing requirements of any national securities exchange on which stock of the same class is then listed, and any other requirements of law or of any regulatory bodies having jurisdiction over such issuance and delivery, shall have been fully complied with.


5.	Non-transferability of Option .

Except as provided in Sections 2(d) and (e) hereof, this option is personal and no rights granted hereunder shall be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) nor shall any such rights be subject to execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this option or of such rights contrary to the provisions hereof, or upon the levy of any attachment or similar process upon this option or such rights, this option and such rights shall become null and void.


6.	No Special Employment or Service Rights .

Nothing contained in the Plan or this Agreement shall be construed or deemed by any person under any circumstances to bind the Company or any of its subsidiaries or affiliates to continue the Service of the Optionholder for the period within which this option may be exercised. However, during the period of the Optionholder’s Service, the Optionholder shall render diligently and faithfully the Services which are assigned to the Optionholder from time to time by the Board of Directors or by the executive officers of the Company and its subsidiaries or affiliates and shall at no time take any action which directly or indirectly would be inconsistent with the best interests of the Company or of its subsidiaries or affiliates.


7.	Rights as a Shareholder .

The Optionholder shall have no rights as a shareholder with respect to any shares which may be purchased by exercise of this option unless and until a certificate or certificates representing such shares are duly issued and delivered to the Optionholder. Except as otherwise expressly provided in the Plan, no adjustment shall be made for dividends or other rights for which the record date is prior to the date such share certificate is issued.


8.	Recapitalization .

In the event that any dividend or other distribution (whether in the form of cash, Class A Ordinary Shares, other securities, or other property), recapitalization, share split, reverse share split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of

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Class A Ordinary Shares or other securities of the Company, or other change in the corporate structure of the Company affecting the Class A Ordinary Shares occurs, the Committee, in order to prevent diminution or enlargement of the benefits or potential benefits intended to be made available under this option, will adjust the number, class, and price of shares covered by this option; provided, however, that the Committee will make such adjustments to this option required by Section 25102(o) of the California Corporations Code to the extent the Company is relying upon the exemption afforded thereby with respect to this option.


9.	Withholding Taxes .

Whenever shares are to be issued upon exercise of this option, the Company shall have the right to require the Optionholder to remit to the Company an amount sufficient to satisfy any federal, state and local tax withholding requirements prior to the delivery of any certificate or certificates for such shares. Notwithstanding anything to the contrary in this Agreement, the Optionholder shall be entitled to satisfy any required tax withholding obligations by directing the Company to withhold Class A Ordinary Shares issuable to the Optionholder upon exercise of the share options under this Agreement that have a Fair Market Value not in excess of the maximum statutory amount required to be withheld.


10.	Company’s Repurchase Right .

All shares purchased upon exercise of the option under this Agreement shall be subject to the Company’s repurchase right as determined under the Plan.


11.	Permitted Transfers .

The Optionholder may not sell, transfer, pledge, assign or otherwise alienate or hypothecate all or any portion of the option, other than by will or by the laws of descent and distribution. The Company will not be required (i) to transfer on its books all or any portion of the option or Shares that have been sold or transferred, or (ii) to treat as owner of all or any portion of the option or Shares, to accord the right to vote as such owner or to pay distributions, if any, to any transferee to whom all or any portion of the option or Shares have been transferred, in violation of the Plan, this Agreement, or any other of the Company’s shareholder agreements or similar agreements (the “Shareholder Agreements”).

(a) During the Optionholder’s lifetime, only the Optionholder or his or her guardian or legal representative may exercise the option. The Board may, in its discretion, require a guardian or legal representative to supply it with the evidence the Board reasonably deems necessary to establish the authority of the guardian or legal representative to exercise the option on behalf of the Optionholder or transferee, as the case may be.

(b) Prior to the consummation of a public offering of the Company’s securities, in no event may the Employee sell, transfer or otherwise dispose of a Class A Ordinary Share without the Board’s advanced written approval.

(c) Upon an exercise of the option, the Optionholder shall join in and enter into the Shareholder Agreements with respect to all Class A Ordinary Shares.

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12.	Investment Representation, Etc .

(a) The Optionholder represents that any shares purchased upon exercise of this option shall be acquired by the Optionholder for his or her own account for investment and not with a view to, or for sale in connection with, any distribution of such shares, nor with any present intention of distributing or selling such shares. By making payment upon exercise of this option, the Optionholder shall be deemed to have reaffirmed, as of the date of such payment, the representations made in this Section 12.

(b) Upon execution of the Shareholder Agreements by the Optionholder, the Company shall have affixed to all share certificates representing Class A Ordinary Shares issued to the Optionholder upon exercise of this option a legend evidencing such agreement.

(c) All share certificates representing Class A Ordinary Shares issued to the Optionholder upon exercise of this option shall, at the election of the Company, have affixed thereto a legend substantially in the following form:

“The shares of stock represented by this certificate (i) are subject to the restrictions on transfer and a repurchase option, all contained in an Nonqualified Share Option Agreement between the Company and the holder of this certificate (a copy of which is available without charge from the Company), and (ii) have not been registered under any securities laws and may not be transferred, sold or otherwise disposed of in the absence of an effective registration statement with respect to the shares evidenced by this certificate, filed and made effective under the Securities Act of 1933 or other foreign law, or an opinion of counsel satisfactory to the Company to the effect that registration under such law is not required.”


13.	Lock-Up Period .

The Optionholder hereby agrees that the Optionholder shall not offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any Class A Ordinary Shares (or other securities) of the Company or enter into any swap, hedging or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Class A Ordinary Shares (or other securities) of the Company held by the Optionholder (other than those included in the registration) for a period specified by the representative of the underwriters of Class A Ordinary Shares (or other securities) of the Company not to exceed one hundred and eighty (180) days following the effective date of any registration statement of the Company filed under the Securities Act (or such other period as may be requested by the Company or the underwriters to accommodate regulatory restrictions on (i) the publication or other distribution of research reports and (ii) analyst recommendations and opinions, including, but not limited to, the restrictions contained in NASD Rule 2711(f)(4) or NYSE Rule 472(f)(4), or any successor provisions or amendments thereto).

The Optionholder agrees to execute and deliver such other agreements as may be reasonably requested by the Company or the underwriter which are consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative

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of the underwriters of Common Stock (or other securities) of the Company, the Optionholder shall provide, within ten (10) days of such request, such information as may be required by the Company or such representative in connection with the completion of any public offering of the Company’s securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section 13 shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a Commission Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer instructions with respect to the shares of Class A Ordinary Shares (or other securities) subject to the foregoing restriction until the end of said one hundred and eighty (180) day (or other) period. The Optionholder agrees that any transferee of the Option or shares acquired pursuant to the Option shall be bound by this Section 13.


14.	Miscellaneous .

(a) Except as provided herein, this Agreement may not be amended or otherwise modified unless evidenced in writing and signed by the Company and the Optionholder.



Date of Grant:		ESTABLISHMENT LABS HOLDINGS INC.

	,	By:

		Title:

		Address:	B15 Coyol Free Zone Alajuela, 20113 Costa Rica Attention: Chief Executive Officer

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OPTIONHOLDER’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.




Signature

Address:

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ESTABLISHMENT LABS HOLDINGS INC.

2015 EQUITY INCENTIVE PLAN

RESTRICTED SHARE AGREEMENT

Name of Grantee: _______________


Number of Shares:	_______ Class A Ordinary Shares (“Restricted Shares”)


Grant Date:	______________


Vesting Schedule:	___________________

This Restricted Share Agreement (the “Agreement”) is between Establishment Labs Holdings Inc. (the “Company”), and you, the Grantee named above, as a Participant in the Establishment Labs Holdings Inc. 2015 Equity Incentive Plan (as amended from time to time, the “Plan”).

This Agreement is effective as of the date of grant indicated above (the “Grant Date”).

Pursuant to Section 4 of the Plan, the Company wishes to grant to you an Award of Restricted Shares on the following terms and subject to the provisions of the Plan, which is incorporated herein by reference. Capitalized terms used but not defined herein shall have the meanings set forth in the Plan.

Accordingly, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Company and you hereby agree as follows:


1.	Award of Restricted Shares .

Subject to the terms and conditions hereof, the Company hereby awards to you the Restricted Shares. The purchase price for the Restricted Shares shall be zero.


2.	Rights with Respect to the Restricted Shares; Stockholders’ Agreement and other Restrictions .

With respect to the Restricted Shares, you shall have, effective as of the Grant Date and subject to the terms of this Agreement, all of the rights, duties, privileges and liabilities of a holder of Class A Ordinary Shares of the Company set forth in the Company’s Amended and Restated Memorandum of Association and Articles of Association (as amended from time to time, the “ M&A ”), including the right to vote the Restricted Shares and to receive dividends on each Restricted Share, unless and until such Restricted Share is forfeited under Section 3 below, and you hereby acknowledge that you have received a copy of the M&A. Notwithstanding the foregoing, you shall be subject to the transfer restrictions set forth in Section 5 of this Agreement. In addition, the Company may elect (in its sole and absolute discretion), as a condition to your receipt of the Restricted Shares, to require that you have entered into any shareholders’ (or similar) agreement in

existence on the Grant Date and that you will enter into any such agreement in effect following the Grant Date, in each case by executing a joinder agreement to such agreement or otherwise.


3.	Vesting .

Your rights with respect to the Restricted Shares shall remain forfeitable to the Company at all times prior to the date or dates on which such Restricted Shares become vested under this Agreement (such period or periods, the “Restricted Period”). Restricted Shares that vest under this Agreement may, hereinafter, also be referred to as “Vested Shares.” Subject to the terms and conditions of this Agreement, the Restricted Shares will become vested (and will thereupon become Vested Shares hereunder) in the amount or amounts set forth opposite “Vesting Schedule” above, subject to your remaining in a Service relationship with the Company or a subsidiary or affiliate of the Company until the respective date or dates set forth opposite “Vesting Schedule” above. Your Restricted Shares will immediately become forfeited on the date your Service with the Company ceases.


4.	Repurchase of Vested Shares .

(a) Upon any termination of your employment with or service (whether as a consultant, advisor, director or in any other capacity) to the Company or a subsidiary or affiliate of the Company for any reason (and for purposes of this Agreement, while you are an employee of the Company or a subsidiary or affiliate of the Company or are providing services to the Company or a subsidiary or affiliate of the Company as a consultant, advisor, director or another type of service provider, you will be considered to be in “Service” or providing “ Services ”), including retirement but other than death or disability, the Company will be entitled (in its sole and absolute discretion) to repurchase, at the Company’s election, all or any of the Vested Shares received hereunder (the “Repurchase Option”). If the Company elects to exercise the Repurchase Option with respect to your Vested Shares, it shall deliver written notice (the “Repurchase Notice”) to you to such effect within 90 days after the occurrence of the event giving rise to the Repurchase Option.

(b) The repurchase price (the “Repurchase Price”) for your Vested Shares to be repurchased (the “Surrendered Securities”) shall be the Fair Market Value of such shares.

(c) (1) Within ten (10) business days after the Repurchase Price for the Surrendered Securities has been determined, the Company shall send a notice to you of the Surrendered Securities setting forth the consideration to be paid for such securities and the time and place for the closing of the transaction, which date shall not be more than twenty (20) days nor less than five (5) days after the delivery of such notice. At such closing, you shall deliver all certificates (if any exist) evidencing the Surrendered Securities to be repurchased to the Company, and the Company shall pay for the Surrendered Securities to be repurchased pursuant to the Repurchase Option by delivery of a check or wire transfer in the aggregate amount of the Repurchase Price for such securities.

(2) The Company shall be entitled to receive, and you agree to provide, customary representations and warranties from you that you are the record and

beneficial owner of the Surrendered Securities free and clear of any liens (other than restrictions imposed by applicable federal, provincial and securities laws and regulations), and that you will transfer and deliver valid title to such securities free and clear of any liens (other than restrictions imposed by applicable federal, provincial and securities laws and regulations).

(d) Notwithstanding anything to the contrary contained in the Plan, all repurchases of Surrendered Securities by the Company shall be subject to applicable laws and regulations and, to the extent applicable, the Company’s debt and equity financing agreements. If any of the foregoing prohibits (in the discretion of the Company) the repurchase of Surrendered Securities which are otherwise permitted or required hereunder, the time periods provided in this Section 4 (other than the time period for delivery of the notice in Section 4(a)) shall be suspended, and the Company may make such repurchases as soon as it is permitted to do so under such restrictions; provided that, notwithstanding the foregoing, in no event shall the time periods provided in this Section 4 be suspended for more than three (3) months and that the Company shall in any event have formally notified you in writing of its election to repurchase within the time period specified in Section 4(a).

(e) In the event the Company delivers a Repurchase Notice to you, but does not elect to repurchase all Vested Shares that you hold, the Vested Shares you hold that the Company has not elected to repurchase in the Repurchase Notice shall no longer be subject to the Repurchase Option.

5. Transfer Restrictions . Except as set forth in a separate agreement between you and the Company, the Restricted Shares may not be transferred other than by will or the laws of descent and distribution, and then only to the extent that a separate agreement or action by the Company provides that Restricted Shares shall remain outstanding following your death. If Restricted Shares remain outstanding following your death, vesting with respect to any Award shall be made only by or to the executor or administrator of the estate of the deceased Participant or the person or persons to whom the deceased Participant’s rights under the benefit shall pass by will or the laws of descent and distribution. Nothing in this Section 5 shall prohibit the transfer of Restricted Shares to the Company upon forfeiture of such Restricted Shares.


6.	Issuance and Custody of Certificates.

(a) You must deliver to the Company a duly signed share power, endorsed in blank, relating to the Restricted Shares.

(b) Any share certificates evidencing the Restricted Shares shall be held in custody by the Company until the vesting restrictions on such shares have lapsed.

7. Adjustment Provisions. In the event that any dividend or other distribution (whether in the form of cash, Class A Ordinary Shares, other securities, or other property), recapitalization, share split, reverse share split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of Class A Ordinary Shares or other securities of the Company, or other change in the corporate structure of the Company affecting the Class A Ordinary Shares occurs, the

Committee, in order to prevent diminution or enlargement of the benefits or potential benefits intended to be made available under this Award, will adjust the number and class of shares covered by this Award; provided, however, that the Committee will make such adjustments to this Award required by Section 25102(o) of the California Corporations Code to the extent the Company is relying upon the exemption afforded thereby with respect to this Award.


8.	Taxes.

Whenever a tax obligation arises with respect to the Restricted Shares, the Company shall have the right to require you to remit to the Company an amount sufficient to satisfy any applicable federal, state, provincial and local tax withholding requirements prior to the delivery of any certificate or certificates for Vested Shares. You shall be entitled to satisfy any required tax withholding obligations by directing the Company to withhold any Vested Shares otherwise issuable to you upon vesting that have a Fair Market Value not in excess of the maximum statutory amount required to be withheld.


9.	Investment Representations, Etc.

(a) You represent that any Restricted Shares (and, if applicable, Vested Shares) acquired pursuant to this Agreement are acquired for your own account for investment and not with a view to, or for sale in connection with, any distribution of such shares, nor with any present intention of distributing or selling such shares.

(b) The Company shall not be required to deliver any Restricted Shares or Vested Shares hereunder until the requirements of any federal, state or provincial securities or other laws, rules or regulations (including the rules of any securities exchange) as may be determined by the Company to be applicable are satisfied, including, without limitation, the completion of any registration or other qualification of the Class A Ordinary Shares under any state, provincial or federal law or under rulings or regulations of the Securities and Exchange Commission or of any other governmental regulatory body and/or the obtaining of any approval or other clearance from any state, provincial or federal governmental agency, in each case, which the Committee shall, in its absolute discretion, determine to be necessary or advisable. Until such time as the Class A Ordinary Shares have been registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or under the laws of the jurisdiction of any exchange, or shall have been transferred in accordance with an opinion of counsel satisfactory to the Company that such registration is not required, stop transfer instructions shall be issued to the Company’s transfer agent, if any, or, if the Company transfers its own securities, a notation shall be made in the appropriate records of the Company with respect to the Restricted Shares or Vested Shares, and, in either case, no purported transfer of Vested Shares shall be valid. The certificates representing Restricted Shares or Vested Shares shall bear a legend substantially as follows:

“ The shares represented by this certificate have not been registered under the Securities Act of 1933, the laws of the jurisdiction of any exchange or applicable state securities laws. These shares have not been acquired with a view to distribution or resale, and may not be sold, mortgaged, pledged, hypothecated or otherwise

transferred without an effective registration statement for such shares under the Securities Act of 1933 or the laws of the jurisdiction of an exchange and any applicable state securities laws, or an opinion of counsel satisfactory to the Company that registration is not required under the Securities Act of 1933, the laws of the jurisdiction of an exchange or under applicable state securities laws .”

10. Lock-Up Period. Participant hereby agrees that Participant shall not offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any Class A Ordinary Shares (or other securities) of the Company or enter into any swap, hedging or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Class A Ordinary Shares (or other securities) of the Company held by Participant (other than those included in the registration) for a period specified by the representative of the underwriters of Class A Ordinary Shares (or other securities) of the Company not to exceed one hundred and eighty (180) days following the effective date of any registration statement of the Company filed under the Securities Act (or such other period as may be requested by the Company or the underwriters to accommodate regulatory restrictions on (i) the publication or other distribution of research reports and (ii) analyst recommendations and opinions, including, but not limited to, the restrictions contained in NASD Rule 2711(f)(4) or NYSE Rule 472(f)(4), or any successor provisions or amendments thereto).

Participant agrees to execute and deliver such other agreements as may be reasonably requested by the Company or the underwriter which are consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative of the underwriters of Class A Ordinary Shares (or other securities) of the Company, Participant shall provide, within ten (10) days of such request, such information as may be required by the Company or such representative in connection with the completion of any public offering of the Company’s securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section 10 shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a Commission Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer instructions with respect to the shares of Class A Ordinary Shares (or other securities) subject to the foregoing restriction until the end of said one hundred and eighty (180)‑day (or other) period. Participant agrees that any transferee of the Restricted Share or the Vested Shares shall be bound by this Section 10.

11. General Provisions.

(a) Interpretations. This Agreement is subject in all respects to the terms of the Plan. A copy of the Plan is available upon your request. In the event that any provision of this Agreement is inconsistent with the terms of the Plan, the terms of the Plan shall govern. Any question of administration or interpretation arising under this Agreement shall be determined by the Committee, and such determination shall be final, conclusive and binding upon all parties in interest.

(b) Integrated Agreement. This Agreement and the Plan constitute the entire understanding and agreement between you and the Company with respect to the subject matter contained herein and supersedes any prior agreements, understandings, restrictions, representations, or warranties between you and the Company with respect to such subject matter other than those as set forth or provided for herein.

(c) No Special Employment or Service Rights. Nothing in this Agreement or the Plan shall be construed as giving you the right to be retained as an employee or service provider of the Company or a subsidiary or affiliate of the Company. In addition, the Company or a subsidiary or affiliate of the Company may at any time dismiss you from employment or service free from any liability or any claim under this Agreement, unless otherwise expressly provided in this Agreement.

(d) Headings. Headings are given to the sections and subsections of this Agreement solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of this Agreement or any provision hereof.

(e) Saving Clause. If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.

(f) Governing Law. The internal laws of the British Virgin Islands (not including the conflict of laws provisions thereof) will govern all questions concerning the validity, construction and effect of this Agreement.

(g) Notices . All communications under this Agreement shall be in writing and shall be delivered by hand or facsimile or mailed by overnight courier or by registered mail or certified mail, postage prepaid:

(i) if to you, to the address or facsimile number specified by you on the signature page attached hereto, or at such other address or facsimile number as you may have hereinafter furnished to the Company in writing; and

(ii) if to the Company, to Establishment Labs Holdings Inc., B15 Coyol Free Zone, Alajuela, 20113, Costa Rica, Attention: Chief Executive Officer, or at such other address or facsimile number as it may have furnished in writing to you.

(h) Delivery of Notices . Any notice so addressed shall be deemed to be given: (i) if delivered by hand or facsimile, on the date of such delivery, if a business day, otherwise the first business day thereafter; (ii) if mailed by courier, on the first business day following the date of such mailing; and (iii) if mailed by registered or certified mail, on the third business day after the date of such mailing.

(i) Survival . All representation, warranties and covenants made by you herein or in any certificate or other instrument delivered by you or the Company under this Agreement shall be considered to have been relied upon by the Company or you, as the case may be, and shall survive all deliveries to you of the Restricted Shares, or payment of consideration to the Company for such

Restricted Shares, regardless of any investigation made by the Company or you, as the case may be, or on the Company’s or your behalf. All statements made by the Company and you in any such certificate or other instrument shall constitute representations and warranties by the Company or you, as applicable, hereunder.

(j) Benefit and Binding Effect. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, permitted assigns, and legal representatives. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment. Nothing in this Agreement shall confer upon any Person not a party to this Agreement any rights or remedies of any nature or kind whatsoever under or by reason of this Agreement.

* * * * *

IN WITNESS WHEREOF, the Company has executed this Agreement as of the day and year first above written.



ESTABLISHMENT LABS HOLDINGS INC.



By:
	Name:
	Title:

Please indicate your acceptance of the terms and conditions of this Agreement by signing in the space provided below and returning a signed copy of this Agreement to the Company. IF A FULLY EXECUTED COPY OF THIS AGREEMENT HAS NOT BEEN RECEIVED BY THE COMPANY, NO RESTRICTED SHARES SHALL BE GRANTED TO YOU.

The undersigned hereby accepts, and agrees to, all terms and provisions of this Agreement.




Name:

Address for Notices:

Exhibit 10.5

CONSULTANCY AGREEMENT

This Consultancy Agreement (the “Agreement’) is made and entered into, effective on July 1st, 2016 (the “Effective Date”) by and between ESTABLISHMENT LABS HOLDINGS INC. a company organized and existing in accordance to the laws of the British Virgin Islands, corporate identification number 1794254, represented by Juan José Chacón (the “Company”) and Salvador Dada Santos, of legal age, with domicile in Heredia, Costa Rica, (the “Consultant”).

WHEREAS:

A. The Consultant has the technical expertise and experience to assist the Company; and,

B. The Consultant is offering his services as a consultant to the Company; and,


C.	The Company desires to retain the Consultant as an independent consultant and acquire his services for the Company by entering into this written Agreement.

NOW, THEREFORE, in consideration of the premises and promises, warranties and representations herein contained, it is agreed as follows:

1. DUTIES . A description of the Consultant’s services are attached hereto as Exhibit A and incorporated by reference herein. Juan Jose Chacon, the Company’s CEO, will direct the Consultant’s activities. The Company hereby engages the Consultant and the Consultant hereby accepts engagement as a consultant, starting the provision of the services on June 1 ^st , 2016. It is understood and agreed, and it is the express intention of the parties to this Agreement, that the Consultant is an independent contractor, and not an employee or agent of the Company for any purpose whatsoever. Consultant shall perform all duties and obligations necessary under the Company’s guidance and supervision. The Consultant agrees to be available at such times as may be scheduled by the Company. The Consultant agrees to promptly perform all services required of the Consultant hereunder in an efficient, professional, trustworthy and businesslike manner.

2. GEOGRAPHIC RESPONSIBILITY : Worldwide.

3. CONSULTING COMPENSATION :

(a) Base Compensation . The Consultant shall be paid a consulting fee of USD$12,384.62 (twelve thousand three hundred eighty four US dollars and sixty two) per month. Payment of all work agreed to by the Company will be paid within the first two working days of every month. Additionally, the Consultant shall receive one yearly payments of USD$12,384.62 (twelve thousand three hundred eighty four US dollars and sixty two), on the first two weeks of December.

(b) Incentive Compensation . The Consultant shall also be afforded an additional annual incentive of $70,000.00 (seventy thousand US dollars), payable upon the achievement of certain individual targets and goals by the Consultant and certain financial, reimbursement and regulatory targets and product development milestones by the Company. Such targets and goals shall be established in writing by the Compensation Committee (and approved by the Board of Directors) within ninety

(90) days of the Commencement Date. The determination of whether such targets have been achieved shall be determined by the Chief Executive Officer and the Board of Director in their sole discretion.

In the event that the Consultant is no longer engaged through the end of the applicable fiscal year, then the Consultant shall be entitled to a pro rata portion of such additional annual compensation equal to the number of months that the Consultant services the Company for the applicable fiscal year divided by twelve (12) months. Any additional annual compensation to which the consultant is entitled shall be paid within one hundred twenty (120) days of the end of the Company’s fiscal years during the Term.

(c) REIMBURSEMENT FOR EXPENSES . The Consultant shall be entitled to reimbursement (upon presentation of satisfactory receipts) by the Company of all reasonable out-of-pocket costs and expenses incurred by the Consultant in connection with providing consulting services requested by the Company ONLY if they are pre-approved by the Company prior to incurring such expense.

(d) Equity . Initial Stock. As soon as practical after the Commencement Date (the “ Grant Date ”), the Company shall grant to the Consultant restricted shares (the “ Initial Stock ”) 147,120 shares of common stock, of the Company (“ Common Stock ”). The Initial Stock shall be issued in accordance with, and subject to, the Company Equity Incentive Plan, as amended (the “ Equity Incentive Plan ”). In the event of a Change in Control during the vesting period, all of the Initial Stock shall immediately vest in full. The other terms and conditions for such grant shall be further described in the Stock Agreement to be entered into between the Company and the Consultant, in the form attached hereto as Exhibit B (the “ Initial Stock Agreement ”) and the Equity Incentive Plan.

(e) For purposes of this Agreement, a “ Change in Control ” will be deemed to have occurred if any person, or group of persons acting together, acquires in any transaction or related series of transactions (i) all or substantially all of the assets of the Company; or (ii) a sufficient number of shares of voting securities of the Company to cause the person, or group of persons, to own beneficially, directly or indirectly, as of the time immediately after the transaction or series of transactions, fifty percent (50%) or more of the outstanding voting securities of the Company (other than as a result of (i) an acquisition of voting securities directly from the Company or (ii) an acquisition of voting securities by the Company which by reducing the voting securities outstanding increases the proportionate voting power represented by the voting securities owned by any such person or group of persons to 50% or more of the combined voting power of such voting securities), if such person, or group of persons, owned beneficially, directly and indirectly, less than fifty percent (50%) of such outstanding voting securities immediately preceding the transaction or series of transactions.

4. CONFIDENTIALITY . The Company and Consultant have entered into a Confidentiality and Non Compete Agreement contemporaneously herewith and the terms of the Confidentiality and Non Compete Agreement are incorporated by reference herein.

5. INDEPENDENT CONTRACTOR STATUS . The Consultant agrees to undertake his consulting duties in a professional, business-like and responsible manner. Consultant understands that since the Consultant is not an employee of the Company, the Company will not withhold income taxes

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or pay any employer-related or employee-related taxes on his behalf, nor will he receive any fringe benefits. The Consultant shall not have any authority to assume or create any obligations, express or implied, on behalf of the Company and shall have no authority to represent the Company as agent, employee or in any other capacity than as herein provided.

The Consultant does hereby indemnify and hold harmless the Company from and against any and all claims, liabilities, demands, losses or expenses incurred by the Company if the Consultant fails to pay any applicable income and/or employment taxes (including interest and/or penalties of whatever nature), in any amount, relating to the Consultant’s rendering of consulting services to the Company, including any attorney’s fees or costs to the prevailing party to enforce this indemnity.

6. TERMINATION . This agreement shall be terminated in the event the Consultant stops working for at least one of the subsidiary companies of the Company. Should the Consultant default on the performance of this Agreement or materially breach any of its provisions, the Company may, in its sole discretion, terminate this Agreement upon written notice to the Consultant. If the Consultant should become unable to perform under this Agreement because of illness, incapacity or death, the Company’s obligations hereunder shall terminate. In the event that the Consultancy Agreement is terminated by the Company without Cause or by the Consultant for Good Reason, in exchange for a complete release of claims against the Company, the Company shall pay to the Consultant a pro-rata portion of any bonus accrued under Section 3(b) up to the Termination Date if the applicable goals and targets described in Section 3(b) are actually achieved by the Company, which portion shall be paid within ninety (90) days after the end of the applicable fiscal year.

7. NO THIRD PARTY RIGHTS . The parties’ warrant and represent that they are authorized to enter into this Agreement and that no third parties, other than the parties hereto, have any interest in any of the claims released hereby.

8. ABSENCE OF WARRANTIES AND REPRESENTATIONS . Each party hereto acknowledges that they have signed this Agreement without having relied upon or being induced by any agreement, warranty or representation of fact or opinion of any person not expressly set forth herein. All representations and warranties of either party contained herein shall survive its signing and delivery.

9. ATTORNEY’S FEES . In the event of any controversy, claim or dispute between the parties hereto, arising out of or in any manner relating to this Agreement, including an attempt to rescind or set aside, the prevailing party in any action brought to settle such controversy, claim or dispute, shall be entitled to recover reasonable attorney’s fees and costs.

10. ARBITRATION . Any and all disputes, claims, differences, disputes or controversies arising out of or in relation to any aspect of this Agreement, its business matter, performance, liquidation, interpretation, validity or any breach thereof, shall be resolved by arbitration in accordance with the bylaws of the International Center for Conciliation and Arbitration (“CICA”). The parties hereby agree to submit voluntarily and unconditionally to its rules and bylaws and claim knowledge thereof. The conflict shall be governed by the substantive laws of Costa Rica. The arbitration shall take place at the CICA in San José, Republic of Costa Rica. An arbitration tribunal of one arbitrator shall decide the matters subject to the arbitration procedure. The arbitrators shall be appointed as called for under

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articles 26 to 30, maybe as the case of Law on Alternative Resolution of Disputes, law No. 7727, if not appointed by one or more the parties on time they shall be appointed by CICA applying its rules.

11. ENTIRE AGREEMENT & GOVERNING LAW . This Agreement sets forth the entire agreement and understanding between the Consultant and the Company, and supersedes all prior agreements, both written and oral, and understandings relating to the consultancy with the Company and the termination of such consultancy, and all prior agreements, whether written or oral, regarding the subject matter hereof are hereby superseded in their entirety, provided, however, that the Confidentiality and Non Compete Agreement executed by the Consultant, whether executed prior to or concurrent with this Agreement shall remain in full force after this Agreement is terminated. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same agreement. The validity, interpretation, construction, and performance of this Agreement shall be governed by the laws of the Republic of Costa Rica applicable to contracts entered into and performed in such country without regard to the choice of law provisions thereof.

12. NOTICES . For all purposes of this Agreement, all communications, including, without limitation, notices, consents, request of approvals, required or permitted to be given hereunder will be in writing and will be deemed to have been duly given when hand delivered or dispatched by electronic facsimile transmission (with receipt thereof confirmed), or five business days after having been mailed to the United States by registered or certified mail, return receipt requested, postage prepaid, or three business days after having been sent by a nationally recognized overnight courier service such as Federal Express or UPS; addressed to the Company (to the attention of the Board of Directors of the Company) at its principal executive offices and to the Consultant at his principal residence as follows:



If to the COMPANY, to:	Establishment Labs S.A.,
	Zona Franca Coyol, Edificio B15
	Alajuela, Costa Rica
	Fax: +(506) 24342400
	Phone: +(506) 24342450

If to the CONSULTANT:


	Mobile:

Or to such other address as any party may have furnished to the other in writing and in accordance herewith, including notices of changes of address.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of the date first written above.



The Company	The Consultant
/s/ Juan Jose Chacon Quiros	/s/ Salvador Dada
ESTABLISHMENT LABS, HOLDINGS INC.	Salvador Dada Santos

EXHIBIT A

DUTIES OF THE CONSULTANT

The Consultant shall perform the following duties:


•	Performed any required task in relation to sales and marketing promotion for the subsidiary companies of the Company in the countries where it shall be required.


•	Assist the distributors of any of the subsidiary companies of the Company in the implementation of any control system or in the course of regular business.


•	Audit any aspect of the operations of any supplier, subcontractor, distributor or subsidiary of the Company or its subsidiaries.

All services shall be rendered abroad and shall exclude the operations of the Company or its subsidiaries in Costa Rica.

Exhibit 10.6

ESTABLISHMENT LABS HOLDINGS INC.

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “ Agreement ”) is made and entered into as of July 1st, 2016 by and between ESTABLISHMENT LABS HOLDINGS INC., a BVI corporation (the “ Company ”) and Juan José Chacón Quirós , an individual residing at Escazú, San José, Costa Rica (the “ Executive ”).

Background

WHEREAS , the Company desires to modify and reinstate the employment conditions of the Executive, it being in the best interest of the Company to arrange the teams of employment between the Executive and the Company for the term hereof;

WHEREAS , the Executive desires to continue being employed by the Company in accordance with the terms hereof; and

WHEREAS , the Company and the Executive mutually intend to set forth herein the terms and conditions of the Executive's employment with the Company.

NOW, THEREFORE , in consideration of the mutual covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Company and Executive agree as follows:

1. Employment . Company hereby agrees to employ the Executive, and the Executive hereby accepts such employment with the Company subject to the terms and conditions set forth herein. During the Term (as defined in Section 2), the Executive shall serve, at the discretion of the Board of Directors of the Company (the “ Board of Directors ”), in the capacity of Chief Executive officer , of the Company, and shall report directly to the Board of Directors. The Executive's duties hereunder will be those normally incident to the position and such other duties as may be reasonably assigned to him from time to time by the Board of Directors. During the Term, except for illness and vacation periods, the Executive shall devote all of his business time, attention, skill and efforts to the faithful performance of his duties hereunder. The Executive shall not be involved with any community or professional organizations or serve as a director for any other entities, other than those activities and investments that do not impair the ability of the Executive to perform the duties of his position.

2. Term / Termination .

(a) Term . The term of the Executive's employment (the “ Term ”) shall be understood to have commenced on March 1, 2016 (the “ Commencement Date ”) and shall continue in full force and effect until terminated in accordance with Section 2(b), 2(c), 2(d) or 2(e) below.

(b) Termination for Cause . The Executive's employment may be terminated by the Company for “Cause.” For purposes of this Agreement, “ Cause ” shall mean (i) the Executive's

conviction, or pleading guilty or nolo contendere to, a felony or other crime involving moral turpitude, (ii) the Executive's engagement in fraud, dishonesty, embezzlement, insubordination, gross negligence or misconduct, (iii) the failure of the Executive to perform his assigned duties or follow the reasonable and lawful directives of the Board of Directors, which failure is not cured within ten (10) days of written notice from the Company of such material failure, (iv) the material breach by the Executive of his obligations hereunder or under any material provision of the Company's Integrity Chart or any related agreements with the Company, which breach (to the extent curable) is not cured within ten (10) days of written notice from the Company of such breach, or (v) any of the causes described in the applicable Labor Code. The Executive shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to him written notice of such termination.

(c) Termination by Executive for Good Reason . The Executive's employment may be terminated by the Executive upon not less than thirty (30) days' prior written notice given to the Company within thirty (30) days after the occurrence of any of the following events:

(i) a material diminution by the Company of the responsibility, importance or scope of the Executives functions, duties or position with the Company from the position and attributes thereof described in Section 1 that is not cured within twenty (20) days of written notice from Executive of such breach;

(ii) breach by the Company of any material provision hereof, which breach (to the extent curable) is not cured within twenty (20) days of written notice from Executive of such breach; or

(iii) any reduction of the Executive's Base Compensation (as defined in Section 3(a) below).

(d) Termination by Reason of Death or Disability . The Executive's employment will automatically terminate upon the death or Disability of the Executive. For purposes of this Section 2(d), the term “ Disability ” shall mean the inability or failure of the Executive to perform the essential functions of his position of employment with the Company with or without reasonable accommodation as a result of a mental or physical disability for a total of ninety (90) or more days (whether or not consecutive) during any twelve (12) months, all as determined in good faith by a majority of the disinterested members of the Board of Directors; provided, however, if the Company maintains a policy insuring against the disability of Executive, then “Disability” shall have the same meaning as in such policy.

(e) Termination by Company without Cause . The Executive's employment may be terminated by the Company without Cause, at any time, for any reason or for no reason, upon thirty (30) days' prior written notice of termination and the payment of all indemnities according to the applicable local legislation.

(f) Termination by Executive without Good Reason . The Executive's employment may be terminated by the Executive without Good Reason, at any time, upon thirty (30) days' prior

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written notice of termination. Upon receipt of the Executive's written notice of termination, the Company may immediately terminate the Executive's employment, which termination shall be deemed for “Cause.”

3. Compensation . The Company shall pay the Executive as compensation, in consideration for all his services hereunder, the amounts described in this Section 3, which are summarized in Exhibit A:

(a) Base Compensation . The Executive will be paid a base salary equivalent to US$288.000 per annum (the “ Base Compensation ”). Such salary shall be paid to the Executive in equal installments not less frequently than monthly, in accordance with the Company's business practices in effect from time to time. Any compensation which may be paid to the Executive under any additional compensation or incentive plans of the Company or which may otherwise be authorized from time to time by the Board of Directors shall be in addition to the Base Compensation to which the Executive is entitled to under this Agreement.

(b) Incentive Compensation . The Executive shall also be afforded additional annual compensation which shall equal up to 50% of the Base Compensation, payable upon the achievement of certain individual targets and goals by the Executive and certain financial, reimbursement and regulatory targets and product development milestones by the Company. Such targets and goals shall be established in writing by the Compensation Committee (and approved by the Board of Directors) within ninety (90) days of the Commencement Date. The determination of whether such targets have been achieved shall be determined by the Chief Executive Officer and the Board of Director in its sole discretion. The Executive shall be entitled to such additional annual compensation only if the Executive is employed by the Company through the end of the applicable fiscal year. In the event that the Executive is no longer employed through the end of the applicable fiscal year, then the Executive shall be entitled to a pro rata portion of such additional annual compensation equal to the number of months that the Executive is employed with the Company for the applicable fiscal year divided by twelve (12) months. Any additional annual compensation to which the Executive is entitled shall be paid within one hundred twenty (120) days of the end of the Company's fiscal years during the Term.

(c) Participation in Plans . During the Executive's employment with the Company, the Executive shall be entitled to participate in all incentive stock option (as provided in this Agreement), savings and retirement plans, policies and programs maintained in force by the Company, including any qualified pension, profit sharing or other retirement plans, non-qualified retirement and deferred compensation plans, and other similar retirement and welfare benefit plans, programs and arrangements, provided that the Executive qualifies for participation in such plans, programs and arrangements pursuant to the terms thereof.

(d) Fringe Benefits . During the Executive's employment with the Company, the Executive shall receive the benefits of group medical, dental, travel and accident, short and long-term disability and term life insurance, subject to the availability and terms and conditions of such arrangements and according to Company policies and procedures.

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(e) Expense Reimbursement . The Company shall pay or reimburse the Executive (or, in the Company's sole discretion shall pay directly), upon a proper accounting as the Company may reasonably require, for reasonable business related expenses and disbursements incurred by the Executive in the course of the performance of the Executive's duties under this Agreement, provided that the incurring of such expenses shall have been approved in accordance with the Company's regular reimbursement procedures and the Travel and Entertainment Policy of the Company.

(f) Withholding . Payment of all amounts to the Executive shall be net of any withholding The Company may withhold from the Executive's compensation all applicable amounts (including, withholding and payroll taxes) required by law.

4. Equity .

Initial Stock . As soon as practical after the Commencement Date (the “ Grant Date ”), the Company shall grant to the Executive, Restricted Share Units equivalent to Class A Ordinary Shares (the “ Restricted Shares ”) to purchase 294,240 shares of the issued and outstanding ordinary shares of the Company. The Restricted Shares shall be issued in accordance with, and subject to the terms and conditions of the Restricted Shares Agreement, as amended (the “ Equity Incentive Plan ”).

For purposes of this Agreement, a “ Change in Control ” will be deemed to have occurred if any person, or group of persons acting together, acquires in any transaction or related series of transactions (i) all or substantially all of the assets of the Company; or (ii) a sufficient number of shares of voting securities of the Company to cause the person, or group of persons, to own beneficially, directly or indirectly, as of the time immediately after the transaction or series of transactions, fifty percent (50%) or more of the outstanding voting securities of the Company (other than as a result of (i) an acquisition of voting securities directly from the Company or (ii) an acquisition of voting securities by the Company which by reducing the voting securities outstanding increases the proportionate voting power represented by the voting securities owned by any such person or group of persons to 50% or more of the combined voting power of such voting securities), if such person, or group of persons, owned beneficially, directly and indirectly, less than fifty percent (50%) of such outstanding voting securities immediately preceding the transaction or series of transactions.

5. Vacation . The Executive shall be entitled to paid vacation during each year of the term of this Agreement for a period not to exceed four (4) weeks

6. Place of Performance . In connection with his employment by the Company, the Executive shall render his services wherever the Company requires it.

7. Facilities Available to Executive . The Company shall furnish Executive with facilities and technical services as may be reasonably appropriate for the performance of his duties in the Company's industry.

8. Payments Due Upon Termination of Employment . In the event that the Executive's employment is terminated by the Company without Cause or by the Executive for Good

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Reason, in exchange for a complete release of claims against the Company, the Company shall: (a) pay to the Executive an amount equal to the aggregate amount of Base Compensation payable to the Executive for the period of the twelve (12) months preceding the Termination Date, payable over the next twelve (12) months in equal parts over the standard payroll pay periods, (b) pay to the Executive a pro-rata portion of any bonus accrued under Section 3(b) up to the Termination Date if the applicable goals and targets described in Section 3(b) are actually achieved by the Company, which portion shall be paid within ninety (90) days after the end of the applicable fiscal year, (c) provide all of the Executive's accrued benefits up to the Termination Date and (d) continue to provide health plan benefits, for the Severance Period (as hereinafter defined). The term “ Severance Period ” shall mean the period commencing on the Termination Date and ending on the 180th day following the Termination Date. If the Executive's employment is terminated by the Company for Cause, or by the Executive other than for Good Reason, then, in any of such events, the Company shall have no obligation to make any payments to the Executive for any period subsequent to such termination, except as provided otherwise by the law. None of the provisions of this Agreement shall be construed to affect the Executive's rights to a continuation of group health plan benefits.

9. Representations of Executive . The Executive hereby represents and warrants to the Company that (a) this Agreement is the valid, legal and binding obligation of Executive, and (b) this Agreement does not, and the Executive's performance of his duties hereunder will not, violate any provision of any agreement, indenture or other instrument, or any fiduciary or other obligation, to which the Executive is a party or by which it is bound.

10. Related Agreements . In connection with the Executive's employment, the Executive is executing on the date hereof an Employee Confidentiality Agreement, attached hereto as Exhibit C, and a Noncompetition, Nondisclosure and Inventions Agreement, attached hereto as Exhibit D (collectively referred to as the “ Related Agreements ”).

11. Indemnification . The Company hereby agrees to indemnify and hold harmless Executive from any and all losses, claims, demands, liabilities and expenses (including reasonable legal or other expenses, including reasonable attorneys' fees) arising out of, based upon or related to any action taken by Executive in his capacity as an officer, director or employee of the Company but specifically excluding any action taken by Executive which is beyond the scope or authority of his capacity as an officer, director or employee of the Company, is a violation of any criminal law or constitutes gross negligence or willful misconduct on Executive's part,; all in accordance with the Company's Memorandum of Association and Articles of Incorporation.

12. General Provisions .

(a) Entire Agreement . This Agreement and the Related Agreements contain the entire understanding between the parties hereto and supersedes any prior employment and consulting agreements and understandings between the Company and Executive.

(b) Nonassignability . Neither this Agreement nor any right or interest hereunder shall be assignable by the Executive, his heirs, beneficiaries or legal representatives without the Company's prior written consent provided , however, that nothing in this Section 12 shall preclude:

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(i) The Executive from designating a beneficiary to receive benefits payable hereunder upon his death; or

(ii) the personal representatives, administrators, or other legal representatives of Executive or his estate from assigning any rights hereunder to the person or persons entitled to such benefits.

The Company may assign this Agreement and its rights and interest hereunder without notice to or the consent of the Executive.

(c) No Attachment . Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation, alienation, sale, assignment, encumbrance, charge, pledge, or hypothecation or to execution, attachment, levy, or similar process or assignment by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be null, void, and of no effect.

(d) Notice . Any notice, consent, approval or other communication given pursuant to the provisions of this Agreement shall be in writing and shall be (i) delivered by hand, (ii) mailed by certified mail or registered mail, return receipt requested, postage prepaid, or (iii) delivered by a nationally recognized overnight courier, U.S. Post Office Express Mail, or similar overnight courier which delivers only upon signed receipt of the addressee, and addressed as follows:



	If to the Company:	ESTABLISHMENT LABS
		B15, Coyol Free Zone,
		Alajuela, 20113, Costa Rica
	Attention:	General Counsel

	If to the Executive:

Any notice shall be effective as of the time of receipt thereof by the addressee or any agent of the addressee, except that in the event the addressee or such agent of the addressee shall refuse to receive any notice given by registered mail or certified mail as above provided or there shall be no person available at the time of the delivery thereof to receive such notice, the time of the giving of such notice shall be the time of such refusal or the time of such delivery, as the case may be. Any party hereto may, by giving five (5) days written notice to the other party hereto in the manner described herein, designate any other address in substitution of the foregoing address to which notice shall be given.

(e) Modification . This Agreement may not be modified or amended except by an instrument in writing signed by the party against whom enforcement is sought.

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(f) Waiver . No term or condition of this Agreement shall be deemed to have been waived, nor shall there be any estoppel against the enforcement of any provision of this Agreement, except by written instrument of the party charged with such waiver or estoppel. No such written waiver shall be deemed a continuing waiver unless specifically stated therein, and each such waiver shall operate only as to the specific term or condition waived and shall not constitute a waiver of such teen or condition for the future or as to any act other than that specifically waived.

(g) Governing Law . The validity, construction, enforcement of and the remedies under this Agreement shall be governed in accordance with the laws of Costa Rica.

(h) Headings . The section headings used herein are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions of this Agreement.

(i) Binding Agreement . This Agreement shall be binding upon, and inure to the benefit of, the Executive and the Company, and the Company's successors and assigns The rights and obligations hereunder are also being granted for the benefit of any subsidiaries of the Company, and such rights and obligations may be enforced by a subsidiary of the Company.

(j) Additional Acts . The Executive and the Company each agrees to execute, acknowledge and deliver all further instruments, agreements or documents and do all further acts that are necessary or expedient to carry out this Agreement's intended purposes. Without limiting the generality of the foregoing, Executive will enter into a stockholders agreement implementing the foregoing vesting arrangements and covering voting and restrictions on transfer of the Restricted Shares, and will enter into the Company's standard form of intellectual property rights assignment agreement.

(k) Construction . Each of the parties hereto declare that they or their counsel participated in the drafting of this Agreement and that, accordingly, this Agreement shall not be construed more strongly against any party hereto because it drafted this Agreement.

(l) Severability . The invalidity or unenforceability of any one or more of the words, phrases, sentences, clauses, or sections contained in this Agreement shall not affect the validity or enforceability of the remaining provisions of this Agreement or any part of any provision, all of which are inserted conditionally on their being valid in law, and in the event that any one or more of the words, phrases, sentences, clauses or sections contained in this Agreement shall be declared invalid or unenforceable, this Agreement shall be construed as if such invalid or unenforceable word or words, phrase or phrases, sentence or sentences, clause or clauses, or section or sections had not been inserted or shall be enforced as nearly as possible according to their original terms and intent to eliminate any invalidity or unenforceability. If any invalidity or unenforceability is caused by the length of any period of time or the size of any area set forth in any part of this Agreement, the period of time or area, or both, shall be considered to be reduced to a period or area which would cure the invalidity or unenforceability.

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(m) Remedies . Unless otherwise specified herein, no remedy conferred upon either party to this Agreement is intended to be exclusive of any other remedy herein or by law provided or permitted, but each shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity. Every power or remedy given by this Agreement to any party or to which such party may otherwise be entitled, may be exercised concurrently or independently, from time to time, and as often as may be deemed expedient and inconsistent remedies may be pursued. Because a breach of the provisions of this Agreement will not adequately be compensated by money damages, the Company shall be entitled, in addition to any other right or remedy available, to an injunction restraining such breach or a threatened breach and to specific performance of any such provision of this Agreement and in either case no bond or other security shall be required in connection therewith, and the parties hereby consent to the issuance of such injunction and to the ordering of specific performance.

(n) Enforcement . If any party hereto shall fail to perform any covenant or condition hereof or shall otherwise be in breach of this Agreement, such party shall pay to the non-defaulting party its reasonable attorneys' fees and costs incurred as a result of their efforts to enforce this Agreement (whether or not litigation is commenced, at all trial and appellate levels and in bankruptcy).

(o) Forum Selection : THE PARTIES HERETO EXPRESSLY SUBMIT THEMSELVES TO AND AGREE THAT ALL ACTIONS ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE RELATIONSHIP BETWEEN THE PARTIES HERETO SHALL OCCUR SOLELY IN THE VENUE AND JURISDICTION OF COSTA RICA.

(p) Execution in Counterparts . The parties hereto may execute this Agreement in two or more counterparts, each of which shall be deemed to be an original, but all such counterparts shall constitute one and the same instrument, and all signatures need not appear on any one counterpart.

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IN WITNESS WHEREOF , the parties hereto have executed and delivered this Agreement as of the day and year first above written.



ESTAB SHMENT LABS HOLDINGS INC.		EXECUTIVE:

/s/ Rudy Mazzocchi		/s/ Juan Jose Chacon Quiros
Name:	RUDY MAZZOCCHI	Name: JUAN JOSE CHACON QUIROS
Title:	EXECUTIVE CHAIRMAN

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EXHIBIT A

Compensation Summary

BASE: US$288,000.00 Annually
POSSIBLE BONUS: US$144,000.00 Annually

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EXHIBIT B

Restricted Shares Agreement

See Attached

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EXHIBIT C

Employee Confidentiality Agreement

See Attached

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EXHIBIT D

Noncompetition, Nondisclosure and Inventions Agreement

See Attached

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Exhibit 10.7

ESTABLISHMENT LABS S.A.

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “ Agreement ” ) is made and entered into as of July 1 ^st , 2016 by and between ESTABLISHMENT LABS S.A a corporation registered in Costa Rica with the corporate identity number 3-101-366337, represented by Juan Jose Chacon (the “ Company ”) and Salvador Dada Santos an individual residing at Belen, Heredia, Costa Rica, (the “ Executive ”).

Background

WHEREAS , the Company desires to modify and reinstate the employment conditions of the Executive, it being in the best interest of the Company to arrange the terms of employment between the Executive and the Company for the term hereof;

WHEREAS , the Executive desires to continue being employed by the Company in accordance with the terms hereof; and

WHEREAS , the Company and the Executive mutually intend to set forth herein the terms and conditions of the Executive’s employment with the Company.

1. Employment . Company hereby agrees to employ the Executive, and the Executive hereby accepts such employment with the Company subject to the teams and conditions set forth herein. During the Term (as defined in Section 2 ), the Executive shall serve, at the discretion of the Board of Directors of the Company (the “ Board of Directors ”), in the capacity of Chief Operating Officer of the Company, and shall report directly to the Chief Executive Officer. The Executive’s duties hereunder will be those normally incident to the positions of General Manager and such other duties as may be reasonably assigned to him from time to time by the C.E.O. and Board of Directors. During the Term, except for illness and vacation periods, the Executive shall devote all of his business time, attention, skill and efforts to the faithful performance of his duties hereunder. The Executive shall not be involved with any community or professional organizations or serve as a director for any other entities, other than those activities and investments that do not impair the ability of the Executive to perform the duties of his position.

2. Term / Termination .

(a) Term . The term of the Executive’s employment (the “ Term ”) shall be understood to have commenced on April 15, 2009 (the “ Commencement Date ”) and shall continue in full force and effect until terminated in accordance with Section 2(b) ,

2 ( c ), 2 ( d ) or 2 ( e ) below.

(b) Termination for Cause . The Executive’s employment may be terminated by the Company for “Cause.” For purposes of this Agreement, “ Cause ” shall mean (i) the Executive’s conviction, or pleading guilty or nolo contendere to, a felony or other crime involving moral turpitude, (ii) the Executive’s engagement in fraud, dishonesty, embezzlement, insubordination, gross negligence or misconduct, (iii) the failure of the Executive to perform his assigned duties or follow the reasonable and lawful directives of the Board of Directors, which failure is not cured within ten (10) days of written notice from the Company of such material failure, (iv) the material breach by the Executive of his obligations hereunder or under any material provision of the Company’s Integrity Chart or any related agreements with the Company, which breach (to the extent curable) is not cured within ten (10) days of written notice from the Company of such breach, or (v) any of the causes described in the applicable Labor Code. The Executive shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to him written notice of such termination.

(c) Termination by Executive for Good Reason . The Executive’s employment may be terminated by the Executive upon not less than thirty (30) days’ prior written notice given to the Company within thirty (30) days after the occurrence of any of the following events:

(i) a material diminution by the Company of the responsibility, importance or scope of the Executive’s functions, duties or position with the Company from the position and attributes thereof described in Section 1 that is not cured within twenty (20) days of written notice from Executive of such breach;

(ii) a relocation of the Company to a site more than one hundred (100) miles from its current headquarters location, unless such relocation moves the Company closer to the Executive’s residence in San Jose, Costa Rica;

(iii) breach by the Company of any material provision hereof, which breach (to the extent curable) is not cured within twenty (20) days of written notice from Executive of such breach; or

(iv) any reduction of the Executive’s Base Compensation (as defined in Section 3 ( a ) below).

(d) Termination by Reason of Death or Disability . The Executive’s employment will automatically terminate upon the death or Disability of the Executive. For purposes of this Section 2(d) , the term “ Disability ” shall mean the inability or failure of the Executive to perform the essential functions of his position of employment with the Company with or without reasonable accommodation as a result of a mental or physical disability for a total of ninety (90) or more days (whether or not consecutive) during any twelve (12) months, all as determined in good faith by a majority of the disinterested members of the Board of Directors; provided, however, if the Company maintains a policy insuring against the disability of Executive, then “Disability” shall have the same meaning as in such policy.

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(e) Termination by Company without Cause . The Executive’s employment may be terminated by the Company without Cause, at any time, for any reason or for no reason, upon thirty (30) days’ prior written notice of termination and the payment of all indemnities according to the applicable local legislation.

(f) Termination by Executive without Good Reason . The Executive’s employment may be terminated by the Executive without Good Reason, at any time, upon thirty (30) days’ prior written notice of termination. Upon receipt of the Executive’s written notice of termination, the Company may immediately terminate the Executive’s employment, which termination shall be deemed for “Cause.”

3. Compensation . The Company shall pay the Executive as compensation, in consideration for all his services hereunder, the amounts described in this Section 3 , which are summarized in Exhibit A:

(a) Base Compensation . The Executive will be paid a base salary equivalent to US$39,000 per annum (the “ Base Compensation ”). Such salary shall be paid to the Executive in equal installments not less frequently than monthly, with a thirteenth installment in the month of December, in accordance with the Company’s business practices in effect from time to time. Any compensation which may be paid to the Executive under any additional compensation or incentive plans of the Company or which may otherwise be authorized from time to time by the Board of Directors shall be in addition to the Base Compensation to which the Executive is entitled to under this Agreement.

(b) Severance . The Company shall pay the executive an additional amount to advance severance of: US$585 per month. The advancement of severance will be paid to the Executive in conjunction with the payment of wages.

(c) Participation in Plans . During the Executive’s employment with the Company, the Executive shall be entitled to participate in all savings and retirement plans, policies and programs maintained in force by the Company, including any qualified pension, profit sharing or other retirement plans, non-qualified retirement and deferred compensation plans, and other similar retirement and welfare benefit plans, programs and arrangements, provided that the Executive qualifies for participation in such plans, programs and arrangements pursuant to the terms thereof.

(d) Fringe Benefits . During the Executive’s employment with the Company, the Executive shall receive the benefits of group medical, dental, travel and accident, car, gas and toll road allowance, short and long-term disability and term life insurance, subject to the availability and terms and conditions of such arrangements and according to Company policies and procedures.

(e) Expense Reimbursement . The Company shall pay or reimburse the Executive (or, in the Company’s sole discretion shall pay directly), upon a proper accounting as the Company may reasonably require, for reasonable business related expenses and disbursements incurred by the Executive in the course of the performance of the Executive’s duties under this Agreement, provided that the incurring of such expenses shall have been approved in accordance with the Company’s regular reimbursement procedures and normal policies of the Company in effect from time to time.

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(f) Withholding . Payment of all amounts to the Executive shall be net of any withholding The Company may withhold from the Executive’s compensation all applicable amounts (including, withholding and payroll taxes) required by law.

4. Vacation . The Executive shall be entitled to paid vacation during each year of the term of this Agreement for a period not to exceed three (3) weeks.

5. Place of Performance . In connection with his employment by the Company, the Executive shall be based at the Company’s principal executive offices, San Jose, Costa Rica, except for required travel on the Company’s business.

6. Facilities Available to Executive . The Company shall furnish Executive with an office, secretarial help and such specialized equipment, supplies, facilities and technical services as may be reasonably appropriate for the performance of his duties in the Company’s industry.

7. Payments Due Upon Termination of Employment . In the event that the Executive’s employment is terminated by the Company without Cause or by the Executive for Good Reason, in exchange for a complete release of claims against the Company, the Company shall: (a) pay to the Executive an amount equal to the aggregate amount of Base Compensation payable to the Executive for the period of the three (3) months preceding the Termination Date, payable over the next three (3) months in equal parts over the standard payroll pay periods, (b) provide all of the Executive’s accrued benefits up to the Termination Date and (c) continue to provide health plan benefits, for the Severance Period (as hereinafter defined). The term “ Severance Period ” shall mean the period commencing on the Termination Date and ending on the 90th day following the Termination Date. If the Executive’s employment is terminated by the Company for Cause, or by the Executive other than for Good Reason, then, in any of such events, the Company shall have no obligation to make any payments to the Executive for any period subsequent to such termination, except as provided otherwise by the law. None of the provisions of this Agreement shall be construed to affect the Executive’s rights to a continuation of group health plan benefits.

8. Representations of Executive . The Executive hereby represents and warrants to the Company that (a) this Agreement is the valid, legal and binding obligation of Executive, and (b) this Agreement does not, and the Executive’s performance of his duties hereunder will not, violate any provision of any agreement, indenture or other instrument, or any fiduciary or other obligation, to which the Executive is a party or by which it is bound.

9. Related Agreements . In connection with the Executive’s employment, the Executive is executing on the date hereof an Employee Confidentiality Agreement, attached hereto as Exhibit C , and a Noncompetition, Nondisclosure and Inventions Agreement, attached hereto as Exhibit D (collectively referred to as the “ Related Agreements ”).

10. Indemnification . The Company hereby agrees to indemnify and hold harmless Executive from any and all losses, claims, demands, liabilities and expenses (including reasonable legal or other expenses, including reasonable attorneys’ fees) arising out of, based upon or related to any action taken by Executive in his capacity as an officer, director or employee of the Company but

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specifically excluding any action taken by Executive which is beyond the scope or authority of his capacity as an officer, director or employee of the Company, is a violation of any criminal law or constitutes gross negligence or willful misconduct on Executive’s part,; all in accordance with the Company’s Memorandum of Association and Articles of Incorporation.

11. General Provisions .

(b) Nonassignability . Neither this Agreement nor any right or interest hereunder shall be assignable by the Executive, his heirs, beneficiaries or legal representatives without the Company’s prior written consent provided, however, that nothing in this Section 12 shall preclude:

(i) The Executive from designating a beneficiary to receive benefits payable hereunder upon his death; or

(ii) the personal representatives, administrators, or other legal representatives of Executive or his estate from assigning any rights hereunder to the person or persons entitled to such benefits.

The Company may assign this Agreement and its rights and interest hereunder without notice to or the consent of the Executive.



If to the Company:	ESTABLISHMENT LABS
	B15, Coyol Free Zone,
	Alajuela, 20113, Costa Rica

Attention:	General Counsel

If to the Executive:

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(e) Modification . This Agreement may not be modified or amended except by an instrument in writing signed by the party against whom enforcement is sought.

(f) Waiver . No term or condition of this Agreement shall be deemed to have been waived, nor shall there be any estoppel against the enforcement of any provision of this Agreement, except by written instrument of the party charged with such waiver or estoppel. No such written waiver shall be deemed a continuing waiver unless specifically stated therein, and each such waiver shall operate only as to the specific term or condition waived and shall not constitute a waiver of such term or condition for the future or as to any act other than that specifically waived.

(g) Governing Law . The validity, construction, enforcement of and the remedies under this Agreement shall be governed in accordance with the laws of Costa Rica.

(h) Headings . The section headings used herein are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions of this Agreement.

(i) Binding Agreement . This Agreement shall be binding upon, and inure to the benefit of, the Executive and the Company, and the Company’s successors and assigns. The rights and obligations hereunder are also being granted for the benefit of any subsidiaries of the Company, and such rights and obligations may be enforced by a subsidiary of the Company.

(j) Additional Acts . The Executive and the Company each agrees to execute, acknowledge and deliver all further instruments, agreements or documents and do all further acts that are necessary or expedient to carry out this Agreement’s intended purposes. Without limiting the generality of the foregoing, Executive will enter into a stockholders agreement implementing the foregoing vesting arrangements and covering voting and restrictions on transfer of the Restricted Shares, and will enter into the Company’s standard form of intellectual property rights assignment agreement.

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unenforceable, this Agreement shall be construed as if such invalid or unenforceable word or words, phrase or phrases, sentence or sentences, clause or clauses, or section or sections had not been inserted or shall be enforced as nearly as possible according to their original terms and intent to eliminate any invalidity or unenforceability. If any invalidity or unenforceability is caused by the length of any period of time or the size of any area set forth in any part of this Agreement, the period of time or area, or both, shall be considered to be reduced to a period or area which would cure the invalidity or unenforceability.

(n) Enforcement . If any party hereto shall fail to perform any covenant or condition hereof or shall otherwise be in breach of this Agreement, such party shall pay to the non-defaulting party its reasonable attorneys’ fees and costs incurred as a result of their efforts to enforce this Agreement (whether or not litigation is commenced, at all trial and appellate levels and in bankruptcy).

IN WITNESS WHEREOF , the parties hereto have executed and delivered this Agreement as of the day and year first above written.



ESTABLISHMENT LABS S.A		EXECUTIVE :

/s/ Juan Jose Chacon Quiros		/s/ Salvador Dada
Name: Juan Jose Chacon Quiros		Name: Salvador Dada Santos

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EXHIBIT A

Compensation Summary



2016	Base Compensation:	US$39,000

EXHIBIT B

Initial Stock Option Agreement

See Attached

EXHIBIT C

Employee Confidentiality Agreement

See Attached

EXHIBIT D

Noncompetition, Nondisclosure and Inventions Agreement

See Attached

Exhibit 10.8



EMPLOYMEENT AGREEMENT	CONTRATO DE TRABALHO
By this private Employment Agreement executed between RD&S PRODUTOS PARA SAÚDE LTDA ., headquartered in the city of Sáo Paulo, at Avenida Guilherme Dumont Villares, 2450, suite 32, in the State of Sao Paulo, Postal Code 05640-004 enrolled with the Finance Ministry General Taxpayer’s List “CN.P.J./M.F. under no. 08.290.164/0001-02, by its undersigned legal representative, hereinafter referred to as EMPLOYER , and Mr. EDDIE DANIEL DE OLIVEIRA , resident and domiciled at Rua Harmonia, 990, apartment 21, city of Sao Paulo, State of Sáo Paulo, Postal Code 05435-001, bearer of Employment Booklet No. 15136 Series 00378-SP Identity Card V862615-K, enrolled with the Individual Taxpayer’s Registration “C. P. F. /M. F. “ under No. 235.770.738-02, hereinafter referred to as EMPLOYEE , have agreed to the following:	Pelo presente instrumento particular de contrato de trabalho entre RD&S PRODUTOS PARA SAUDE LTDA., com sede á Avenida Guilherme Dumont Villares, 2450, suite 32, cidade de Sáo Paulo, Estado Sáo Paulo, CEP 05640-004, inscrita no C.N.P.J./M.F. sob o n° 08.290.164/0001-02, por seu representante legal infra-assinado, doravante designada simplesmente EMPREGADORA, e o Sr. EDDIE DANIEL DE OLIVEIRA, residente e domiciliado á Rua Harmonia, 990, apartamento 21, cidade de Sáo Paulo, Estado de Sáo Paulo, CEP 05435-001, portador da Carteira Profissional n° 15136, Serie 00378-SP, cedula de identidade V862615-K, inscrito no "C.P.F./ M.F." sob o n° 235.770.738-02, doravante designado simplesmente EMPREGADO, tȇm entre si justo e contratado o quanto segue:

CLAUSE 1 - OBJECT OF THE AGREEMENT	CLÁUSULA 1 - OBJETO DO CONTRATO

1.1. EMPLOYEE shall be hired by EMPLOYER, to perform the duties of Executive Director, in a date to be defined by the Parties once the respective work authorization is granted allowing him to work at EMPLOYER, and shall comply with all services’ rules, general communications and applicable instructions, such as the company’s policies generally applicable to all of its employees. The job description for the position is in Exhibit 1 of this agreement.	1.1. O EMPREGADO é contratado pela EMPREGADORA para exercer a funçáo de Diretor Executivo, em data a ser definida pelas partes após a concessão da sua respectiva autorização de trabalho na EMRPEGADORA pelas autoridades imigratórias, obrigando-se a cumprir todas as normas de serviços, comunicações gerais e instruções vigentes, tais como políticas gerais da empresa aplicáveis a todos os seus empregados. A descrição das atividades do cargo consta no anexo 1 deste Contrato.

1.2. The EMPLOYEE undertakes to render services to other companies within EMPLOYER’s economic group, or companies licensed by any company within the group, or by any other connected to the EMPLOYER, and in this event, the payment for these services is included in the remuneration agreed upon in clause 4 herein, according to the needs of the EMPLOYER and within the scope of his duties	1.2. O EMPREGADO concorda que poderá ser requisitado a prestar serviços para outras empresas do mesmo grupo econOrnico ou empresas licenciadas por qualquer empresa do mesmo grupo econômico da EMPREGADORA, bem como qualquer outra empresa de alguma forma a ela vinculada, sendo que, em tal circunstância, o pagamento relativo a esses serviços já está incluido na remuneração acordada na cláusula 4 ^a , infra, de acordo corn as necessidades da EMPREGADORA e dentro do escopo de suas atribuições



1.3. EMPLOYEE agrees that the EMPLOYER is entitled at any time to assign him other compatible duties, in accordance with the EMPLOYER’S technical or administrative needs	1.3. O EMPREGADO concorda que a EMPREGADORA poderá designar-lhe outras atribuiçães compatíveis, a qualquer tempo e conforme suas necessidades de ordem técnica ou administrativa.

1.4. EMPLOYEE hereby undertakes to work exclusively for the EMPLOYER, dedicating his entire time, attention, skills and efforts to the progress and interests of the EMPLOYER and companies of the same economic group. EMPLOYEE is hereby forbidden to perform any activity that may compete with the EMPLOYER’S activities, unless previously authorized in writing by the EMPLOYER	1.4. O EMPREGADO, por este Contrato, obriga-se a trabalhar exclusivamente para a EMPREGADORA, dedicando todo seu tempo, atenção, habilidades e esforços ao progresso e interesses da EMPREGADORA e das empresas que integram seu grupo econômico, sendo-lhe vedado exercer outra atividade que possa concorrer com as atividades da EMPREGADORA, salvo com prévia autorização, por escrito, por parte desta.

1.5. The EMPLOYEE agrees that he may be transferred to render his services at any site where the EMPLOYER might need his services, either in the city where the EMPLOYER’S headquarters are located or at any other site. The EMPLOYEE hereby also agrees to travel to perform his duties at any time and to any place in the national territory or abroad, as determined by the EMPLOYER.	1.5. O EMPREGADO concorda que poderá ser transferido para prestar seus serviços em qualquer localidade em que a EMPREGADORA deles necessite, tanto no municipio da sede da EMPREGADORA como fora dele. O EMPREGADO também concorda em realizar todas as viagens que the forem determinadas pela EMPREGADORA, em qualquer tempo e a qualquer parte do territorió nacional ou exterior, no desempenho de suas funções.

1.6. Among other duties, the EMPLOYEE has the obligation to comply with the business plan established by the EMPLOYER.	1.6. Dentre outros deveres, o EMPREGADO terá a obrigação de cumprir corn o plano de negócios estabelecido pela EMPREGADORA.

CLAUSE 2 - AGREEMENT TERM	CLÁUSULA 2 - DA DURAÇÃO DO CONTRATO

2.1. The present Agreement shall be in effect for an indeterminate term.	2.1 . O presente Contrato vigrarápor tempo indeterminado.



CLAUSE 3 - WORKING HOURS	CLÁUSULA 3 - DA DURAÇÃO DA JORNADA DE TRABALHO

3.1. The EMPLOYEE will hold a trustworthy position, for what he shall not be subject to working hours schedule or control, under Article 62, subparagraph II of the Brazilian Labor Code.	3.1. O EMPREGADO não estará sujeito a jornada ou controle de horário de trabalho, pois ocupará cargo de confiança, nos termos do artigo 62, inciso II, da CLT

CLAUSE 4 - REMUNERATION	CLÁUSULA 4 - DA REMUNERAÇÃO

4.1. For the rendered services, EMPLOYEE shall receive from EMPLOYER a gross monthly salary of R$ 47.750,00 (forty seven thousand seven hundred and fifty Reais) to be paid pursuant to the legislation in force, and salary adjustments will be made as provided by law. The applicable taxes will be deducted from the gross salary.	4.1. O EMPREGADO receberá, pelos serviços prestados, o salário bruto de R$ 47.750,00 (quarenta e sete mil setecentos e cinquenta reais), pago mensalmente, conforme a legislação em vigor; os reajustes de salário serão feitos de acordo com a lei. Os impostos aplicáveis serão dedzidos do salário bruto.

4.2. EMPLOYER is hereby authorized to deposit in a bank of its choice, in the EMPLOYEE’s checking account, salaries, 13th salaries, vacation pay, and any other sums that make up the EMPLOYEE’s remuneration.	4.2. A EMPREGADORA fica autorizada a depositar em instituição bancaria de sua escolha, na conta corrente do EMPREGADO, salários, 13° salários, férias e quaisquer outras importâncias que se refiram á remuneração do EMPREGADO.

4.3 . In addition to the legal deductions, EMPLOYER is hereby authorized to make the following deductions from the EMPLOYEE’s remuneration or from any other of his labor rights or credits: (a) any amounts owed by the EMPLOYEE , such as loans, scholarships, advancements, life insurance, health insurance, meals, agreements, purchases made at organizations and institutions affiliated with EMPLOYER or other deductions, as duly authorized; and (b) the amount equivalent to any losses and/or damages caused by misconduct, negligence, imprudence or malpractice of EMPLOYEE to EMPLOYER’s property, including material of any kind which has been placed under his responsibility and not returned in due time.	4.3. Além dos descontos legais, fica a EMPREGADORA autorizada a descontar da remuneração ou de quaisquer outros direitos ou créditos de natureza trabalhista do EMPREGADO: (a) as importâncias de que o EMPREGADO for devedor, relativas a empréstimos, bolsas de estudo, adiantamentos, seguro de vida, assisténcia médica, refeições, convȇnios, compras que efetuar em organizações e instituições coligadas á EMPREGADORA ou outros descontos devidamente autorizados; e (b) o valor de prejuizos e/ou danos a que o EMPREGADO der causa em virtude de dolo, negligȇncia, imprudȇncia ou imperícia, ao patrimônio da EMPREGADORA, inclusive materiais de qualquer natureza, sob sua responsabilidade e não devolvidos no tempo devido




CLAUSE 5 - EMPLOYEE will also be entitled to the following payments:	CLÁUSULA 5 - O EMPREGADO também fará jus aos seguintes pagamentos:

5.1 . EMPLOYEE will be eligible to receive an annual variable amount, as per the EMPLOYER’s policy, to be paid under the title of “bonus”, if the conditions and goals pre-established by the EMPLOYER for each of such payments are met.	5.1. O EMPREGADO será elegível ao recebimento de uma parcela variável annual, de acordo com as politicas internas da EMPREGADORA, a ser paga sob o título de "bônus", desde que observadas as condições e preenchidas as metas pré-estabelecidas pela EMPREGADORA para cada uma dessas parcelas

5.2 . Specifically for 2016, the employee will be eligible to a bonus in the total gross amount of R$ 400.000,00 (four hundred thousand reais) which shall be paid as follows: (i) R$ 200.000,00 (two hundred thousand reais) to be paid on the EMPLOYEE’s first day of work at the EMPLOYER, conditioned to the signature of this agreement and concession of the respective work visa to the EMPLOYEE; (ii) R$ 100.000,00 (one hundred thousand reais) to be paid on the date that the registration of Establishment Labs products are dully filed with ANVISA or on July 1st, 2016, whichever happens last; and (iii) R$ 100.000,00 (one hundred thousand reais) to be paid together with the EMPLOYEE’S monthly salary of December 2016	5.2. Especificamente para o ano de 2016, o EMPREGADO será elegível ao pagamento de urn bônus no valor total bruto de R$ 400.000,00 (quatrocentos mil reais), a ser pago da seguinte forma: (i) R$ 200.000,00 (duzentos mil reais) a serem pagos no primeiro dia de trabalho do EMPREGADO, e condicionado á assinatura do presente Contrato e á concessão do respectivo visto de trabalho para o EMPREGADO; (ii) R$ 100.000,00 (cem mil reais) a serem pagos na data de registro dos produtos da Establishment Labs junto á ANVISA, ou no dia 1° de Julho de 2016, o que ocorrer mais tarde; e (iii) R$ 100.000,00 (cem mil reais) a serem pagos juntamente com o salário do EMPREGADO no més de dezembro de 2016.

5.3. For the year 2017 and the following years, the annual variable payment will be defined as per the EMPLOYER’s internal policies.	5.3. Para o ano de 2017 e seguintes, o pagamento da parcela variável anual será definido de acordo com as políticas internas da EMPREGADORA



5.4. Except for the payments in clause 5.1. “(i)” and “(iii)” above, the variable amounts foreseen herein do not represent and will not have any warranty of payment, considering that the possibility of payment of such amounts, as well as the effective amounts to be paid will depend on the achievement of conditions and goals that will vary from time to time.	5.4. Exceto ao que se refere aos pagamentos previstos na cláusula 5.1. "(i)" e "(iii)" acima, o valor da parcela variável aqui prevista não representará e não terá uma garantia mínima ou fixa, já que a possibilidade de ganho, bem como os valores a serem pagos dependerão do cumprimento das metas e condições que variarão de tempos em tempos

CLAUSE 6 - CONFIDENTIALITY, NON-DISCLOSURE AND NON-PRIVACY IN USING THE EMPLOYER’S COMMUNICATION OR ELECTRONIC SYSTEMS	CLÁUSULA 6 - DA CONFIDENCIALIDADE, SIGILO E NÃO-PRIVACIDADE POR USO DE SISTEMAS DE COMUNICAÇÕES OU SISTEMAS ELETRÔNICOS DA EMPREGADORA

6.1. Under no circumstance shall the EMPLOYEE, directly or indirectly during the term of his services to the EMPLOYER and after his termination, for whichever reason, transmit or disclose to any person, company, association or partnership, nor use on his own account, without the written approval of the EMPLOYER, any information received during his employment relationship with the EMPLOYER or from any other company directly or indirectly related to the same. The EMPLOYEE agrees that all data and information will be received as classified and confidential information.	6.1 . Em nenhuma circunstância o EMPREGADO deverá, direta ou indiretamente, durante a prestaҫao de serviҫos à EMPREGADORA e após o seu término, qualquer que seja a causa, transmitir ou revelar a qualquer pessoa, empresa, sociedade ou negócio, nem usar por sua própria conta, sem a aprovaҫão escrita da EMPREGADORA , qualquer informaҫão recebida durante seu vínculo empregatício com a EMPREGADORA , ou recebida de qualquer empresa direta ou indiretamente relacionada com a mesma. O EMPREGADO concorda que todos esses dados e informaҫões serão recebidos como informaҫões confidenciais e sigilosas.

6.1.1. Confidential information is any and all information of a technical, financial and/or business nature, and includes, but is not limited to information of business or transactions in connection with EMPLOYER or any of its divisions, computer programs, source and object codes, know-how, slogans, expressions, ideas, advertising material, formulae, trade secrets, products, whether patented or not, drawings, designs, plans, client data, systems and/or any other related material	6.1.1 . Considera-se informaҫão confidencial e sigilosa toda e qualquer informaҫão de caráter técnico, financeiro e/ou comercial, incluindo, mas não se limitando, a informaҫões sobre negócios ou transaҫões relativos à EMPREGADORA ou qualquer uma de suas divisões, programas de computador, códigos fonte e objeto, know-how, slogans, expressões, ideias, material publicitário, fórmulas, segredos de negócio, produtos, patenteados ou não, desenhos, projetos, planos, dados de clientes, esquemas e/ou quaisquer outros materiais correlatos.



6.1.2. Copies of any information or any part thereof shall be made only if absolutely necessary, and the confidentiality of such copies shall be maintained as if they were originals.	6.1.2 . Cópias de quaisquer informaҫões ou qualquer parte destas deverão ser feitas somente quando absolutamente necessárias, e a confidencialidade de tais cópias deverá ser protegida como se fossem originais.

6.2. EMPLOYEE shall return to EMPLOYER, upon termination or whenever requested by the EMPLOYER at any other time, all lists of clients, guidelines and data on sales and services, operations and business, as well as all other papers, records and documents prepared either by the EMPLOYER or by the EMPLOYEE, or under his possession during his employment or incident to the same, in connection with any other matters established hereof, or otherwise regarding the business or activities of the EMPLOYER or third parties.	6.2 . O EMPREGADO deverá devolver à EMPREGADORA , por ocasião do término do contrato de trabalho ou a qualquer tempo, sempre que solicitado pela EMPREGADORA , todas as listas de clientes, orientaҫões e dados sobre vendas e servicos, operaҫões e negócios, bem como todos os demais papéis, registros e documentos elaborados pela EMPREGADORA ou pelo EMPREGADO , que estejam em poder desse durante seu vínculo empregatício ou sejam de alguma forma a ele pertinentes, em relaҫão a quaisquer outros assuntos estabelecidos neste Contrato, ou de alguma forma relativos aos negócios ou atividades da EMPREGADORA ou de terceiros.

6.3. The purpose of this Agreement is to protect the secrecy and title to the information, and nothing provided herein shall be deemed as a license, or shall oblige EMPLOYER and/or its licensors to grant to EMPLOYEE or any other individual or legal entity, a license to use the information for any purpose other than those authorized and expressly defined, in writing, by EMPLOYER	6.3 . O objetivo do presente Contrato é de proteger o sigilo e propriedade das informaҫões, e nada contido neste Contrato deverá ser considerado como uma licenca, ou obrigará a EMPREGADORA e/ou seus licenciantes a concederem ao EMPREGADO ou a qualquer outra pessoa física ou jurídica uma licenca para utilizar as informaҫões para qualquer fim que não aqueles autorizados e expressamente definidos, por escrito, pela EMPREGADORA .

6.4. It is agreed that the EMPLOYEE does not have any privacy relating to the use of the EMPLOYER’s communication systems or any electronic systems, including the Internet and emails, which may be monitored, by sampling, by EMPLOYER from time to time.	6.4 . Fica acordado que o EMPREGADO não possui privacidade para use do sistema de comunicaҫão ou de qualquer sistema eletrônico da EMPREGADORA , incluindo Internet e e-mails, os quais poderão ser monitorados de tempos em tempos, por amostragem, pela EMPREGADORA .



CLAUSE 7 - COMPETITIVE ACTIVITIES AND NON-SOLICITATION	CLAUSULA 7 - DAS ATIVIDADES COMPETITIVAS E NÃO-SOLICITAҪÃO

7.1. EMPLOYEE hereby agrees that either during the effective term of this Agreement, and for a term of up to twelve (12) months immediately after the termination thereof, for any reason, in the Brazilian territory in which EMPLOYEE has performed his services for the company, EMPLOYEE shall not (i) work or use his knowledge in any work or activity that competes with the EMPLOYER’s activities, directly or indirectly, either as owner, partner, representative, consultant or employee, nor shall he help or have interest in companies related to the development, manufacturing or sale of a product, process or mechanism, similar or competitive with those to which he had access at the EMPLOYER or that are developed, manufactured or sold at or through the EMPLOYER; he may however work freely in activities which do not compete with those of the EMPLOYER, if made known to and agreed to in writing by the EMPLOYER; (ii) create or acquire any interest (with the exception of interests not exceeding 5% of a listed company) in any company or groups carrying on any activities competing with those carried on by the EMPLOYER and companies within its economic group	7.1 . O EMPREGADO concorda que, durante a vigência deste Contrato, e durante o prazo de até 12 (doze) meses, imediatamente subsequentes ao término deste contrato, por qualquer razão, no território brasileiro no qual o EMPREGADO tenha prestado os seus servicos, o EMPREGADO (i) não trabalhará ou utilizará seu conhecimento em qualquer trabalho ou atividade concorrente com as atividades da EMPREGADORA , direta ou indiretamente, seja como dono, sócio, representante, consultor ou empregado, nem ajudará ou terá interesse em empresas relacionadas ao desenvolvimento, fabricaҫão ou venda de um produto, processo ou mecanismo, similar ou concorrente com aqueles a que teve acesso na EMPREGADORA , ou que sejam desenvolvidos, fabricados ou vendidos pela EMPREGADORA , podendo todavia trabalhar livremente em atividades não concorrentes às da EMPREGADORA , mediante o conhecimento e aceitaҫão por escrito da EMPREGADORA ; (ii) não poderá criar ou adquirir qualquer participacão (exceto participaҫões inferiores a 5% de uma empresa autorizada) em qualquer empresa ou grupo econômico que desenvolva qualquer atividade que seja concorrente às atividades da EMPREGADORA ou de qualquer empresa que integre seu grupo econômico.

7.2. For the purpose of the above provision relating to the non-compete restriction upon termination of this Agreement, the parties agree that the EMPLOYER will have the right to require the EMPLOYEE not to compete, as per the conditions of the above provision.	7.2 . Para o objetivo da cláusula acima relacionado com a não-competicão após a rescisão deste Contrato, as partes acordam que a EMPREGADORA terá o direito de solicitar ao EMPREGADO para não-competir, conforme as condiҫões da cláusula acima.

7.2.1. If the EMPLOYER wishes to exercise such option, the EMPLOYER shall, no later than ten (10) business days after the date of termination of employment, send a written notification to the EMPLOYEE , indicating the EMPLOYER’s intention to exercise such option	7.2.1 . Na hipótese da EMPREGADORA desejar exercer tal opҫão, terá o prazo máximo de 10 (dez) dias úteis, após a data do término do contrato, para enviar ao EMPREGADO uma notificaҫão, informando sua intenҫão de exercer tal opҫão.



7.2.1.1. The exercise of the EMPLOYER’s option for the EMPLOYEE’ s non- competition obligation shall be conditioned on the payment, by EMPLOYER , of an indemnification in the amount equivalent to the last base salary of the employee for each month of non-competition.	7.2.1.1. O exercício da opção da EMPREGADORA para que o EMPREGADO cumpra com a obrigação de não competir estará condicionado ao pagamento de uma indenização equivalente ao valor do último salário base do empregado, para cada mês de não competição.

7.2.1.2. In the event that EMPLOYEE incurs in violation of any restriction clause provided in this Agreement, including the non-compete provision, EMPLOYER will be dismissed of paying any amount related to clause 7.2.1.1 that may still be pending at the time of the violation.	7.2.1.2. Caso ocorra violação, pelo EMPREGADO , de qualquer cláusula de restrição prevista neste Contrato, inclusive de não-competição, não serão devidos pela EMPREGADORA eventuais pagamentos futuros referentes à previsão da cláusula 7.2.1.1 que porventura estejam em aberto na ocasião da violação.

7.3. During the period of his employment at the EMPLOYER and during a subsequent period of twelve (12) months after the termination of this Agreement, EMPLOYEE shall not, directly or indirectly: - Employ, hire, or attempt to employ or hire any person who has been, within twelve (12) months prior to and after the termination of this Agreement, an employee or contractor of the EMPLOYER , its affiliates, or of any other company within the same economic group; to assist such employment or retention, or otherwise induce or encourage any such employee or contracted party to terminate his relationship with the EMPLOYER or with any other company within the same economic group. For the purposes of this Clause, the hiring by EMPLOYEE or any other entity, directly or indirectly, with the EMPLOYEE’s support, of any individual that fits the definition above shall be subject to the restrictions provided herein, even if formalized in a different manner than that executed with the EMPLOYER , including, but not limited to, the hiring of any individual as a contractor rather than as an employee.	7.3. Durante o seu período de trabalho na EMPREGADORA e durante um período posterior de 12 (doze) meses após o término deste Contrato, o EMPREGADO se compromete, direta ou indiretamente, a não: - Empregar, contratar ou tentar empregar ou contratar qualquer pessoa que, nos 12 (doze) meses anteriores e posteriores ao término deste Contrato, tenha sido um empregado ou contratado da EMPREGADORA , das suas sociedades coligadas, ou de qualquer outra sociedade do mesmo grupo econômico; assessorar tal oferta de emprego ou retenção, ou, de outro modo, induzir ou encorajar o referido contratado ou empregado a rescindir o seu vínculo com a EMPREGADORA ou com qualquer outra empresa do mesmo grupo econômico. Para os fins específicos desta Cláusula, a contratação, pelo EMPREGADO ou qualquer outra empresa, direta ou indiretamente, com o suporte do EMPREGADO , de qualquer indivíduo que se enquadre na definição acima estará sujeita às restrições aqui estabelecidas, mesmo se tal contratação for formalizada de forma diferente daquela adotada pela EMPREGADORA



- Solicit or encourage any client, investor, customer, supplier or agent of the EMPLOYER, affiliated companies, or of any other company within the same economic group, to terminate its relationship with them, or to conduct with any person any business or activity which such client, customer, supplier or agent conducts with the EMPLOYER or with any other company within the same economic group.	em relação ao mesmo indivíduo, incluindo, mas não se limitando, à contratação de qualquer indivíduo como prestador de serviços e não como empregado; - Induzir ou incentivar qualquer cliente, investidor, comprador, fornecedor ou representante da EMPREGADORA , sociedades coligadas, ou de qualquer outra sociedade do mesmo grupo econômico a interromper o seu relacionamento com os mesmos, ou conduzir com qualquer pessoa quaisquer dos negócios ou atividades que tal cliente, comprador, fornecedor ou representante conduza com a EMPREGADORA ou com qualquer outra sociedade do mesmo grupo econômico.

7.4. The EMPLOYEE acknowledges that the violation, in whole or in part, of any of the above clauses agreed upon is motive for the termination of this Agreement with the EMPLOYER for cause, if still in force.	7.4. O EMPREGADO reconhece que a violação, no todo ou em parte, de qualquer das cláusulas acordadas acima constituirá motivo para a rescisão por justa causa de seu contrato de trabalho com a EMPREGADORA, caso ainda vigente.



CLAUSE 8 - TITLE TO INVENTIONS OR CREATIONS	CLÁUSULA 8 - TITULARIDADE DE INVENÇÕES OU CRIAÇÕES

8.1. As a result of the Employment Agreement with EMPLOYER and inconsideration of the agreed salary, EMPLOYEE expressly represents and acknowledges that all creations, which shall mean all discoveries, inventions, ideas, concepts, know-how, research, as well as all other information, including those of a confidential nature, processes, products, formulae, methods and improvements, or portions thereof, including among others, all computer programs, algorithms, sub-routines, source codes, object codes, designs, their derivations, upgrades (hereinafter, the “Creations”), conceived, developed or in any other way created by EMPLOYEE himself or in cooperation with other persons, and in any way related to (i) EMPLOYER; (ii) this Agreement and EMPLOYEE’s activities; (iii) Confidential or proprietary Information of EMPLOYER, whether patentable or not, subject to author’s rights protection or not, reduced to tangible form, put into practice or not, created during the term of his employment agreement (performed or not at EMPLOYER’s facilities or further, disclosed by EMPLOYEE to EMPLOYER ), jointly with all products or services which physically represent such creations, shall be the exclusive property of EMPLOYER , which has the right, at its own discretion and with no obligation to compensate the EMPLOYEE , to economically exploit such Creations, license and/or assign the rights thereto to third parties, in an exclusive manner and without any type of restriction or limitation, especially in regards to the forms of use, exploitation, distribution or circulation of such Creations	8.1. Em decorrência de seu contrato de trabalho com a EMPREGADORA e em consideração ao salário ajustado, o EMPREGADO declara e reconhece expressamente que todas as criações, que significarão todas as descobertas, invenções, ideias, conceitos, know-how, pesquisas, bem como demais informações, incluindo as de caráter sigiloso, processos, produtos, fórmulas, métodos e aperfeiçoamentos, ou partes destes, inclusive, entre outros, todos os programas de computação, algoritmos, sub-rotinas, códigos fontes, códigos objetos, designs, suas derivações, melhorias e aperfeiçoamentos (doravante, simplesmente "Criações"), concebidas, desenvolvidas ou, de outro modo, criadas pelo EMPREGADO, sozinho ou em cooperação com outros, e, de qualquer forma, relacionados à (i) EMPREGADORA ; (ii) este Contrato e às tarefas do EMPREGADO; (iii) Informações Confidenciais e/ou de propriedade da EMPREGADORA , quer patenteáveis ou não, quer sujeitos à proteção de direitos autorais ou não, quer reduzidos a forma tangível, postos em prática ou não, criadas durante a vigência do seu contrato de trabalho (efetuados ou não nas dependências da EMPREGADORA ou, ainda, revelados pelo EMPREGADO à EMPREGADORA ), em conjunto com todos os produtos ou serviços que representam fisicamente tais criações, serão de propriedade exclusiva da EMPREGADORA , sendo direito desta, a seu exclusivo critério e sem qualquer obrigação de compensar o EMPREGADO , explorar economicamente tais Criações, licenciar e/ou ceder a terceiros os direitos sobre estas, de forma exclusiva e sem qualquer espécie de restrição ou limitação, em especial no que se refere à forma de utilização, exploração, distribuição ou circulação das Criações.



8.2. EMPLOYEE , for all legal purposes, freely assigns to EMPLOYER all his rights, title and participation related to the Creations and any tangible matters which evidence, integrate, constitute, represent or register such Creations, and agrees to (i) cooperate with EMPLOYER and assist it, free of charge, to obtain and maintain any governmental protection which EMPLOYER may solicit for such Creations, and to sign all documents EMPLOYER may request for such purpose, and (ii) assign to EMPLOYER , free of charge, all the inventor’s equity interest, patents and other exclusive rights which EMPLOYEE has or may have in connection with such Creations, as well as the rights to request and/or fully hold, without limitations, the foreign and U.S. copyrights, patents and trademarks related to the Creations.	8.2. Para todos os fins de direito, o EMPREGADO cede à EMPREGADORA , gratuitamente, todos os seus direitos, titularidade e participação relativos às Criações e quaisquer materiais tangíveis que evidenciem, incorporem, constituam, representem ou registrem essas Criações, e concorda (i) em cooperar com a EMPREGADORA e a assessorá-la, gratuitamente, na obtenção e manutenção de qualquer proteção governamental que esta vier a intentar para tais Criações, e a assinar todos os documentos que a EMPREGADORA venha a exigir para esse fim, e (ii) em ceder para a EMPREGADORA , gratuitamente, todos os direitos patrimoniais de autor, patentes e outros direitos exclusivos que o EMPREGADO possui ou venha a possuir com respeito a essas Criações, bem como direitos de solicitar e/ou deter integralmente, sem restrição, direitos autorais, patentes e marcas registradas estrangeiras e norte-americanas com respeito às Criações.

8.3 . Notwithstanding the foregoing, the parties hereto expressly agree that the Creations shall be the exclusive property of EMPLOYER , even when created outside its facilities and without the resources normally available at EMPLOYER’s facilities, if such Creations are related to or arise out of the EMPLOYEE’s employment agreement. EMPLOYEE undertakes not to claim the property and/or title to the Creations at any time, not to use nor allow third parties to use such Creations at any time, except when expressly authorized in writing by EMPLOYER.	8.3. Independentemente do acima disposto, as partes acordam expressamente que as Criações pertencerão exclusivamente à EMPREGADORA mesmo que criadas fora das suas dependências e sem os recursos normalmente localizados na EMPREGADORA , se vinculados ou decorrerem do contrato de trabalho do EMPREGADO . O EMPREGADO se obriga a não reclamar, a qualquer tempo, as Criações como de sua propriedade e/ou titularidade, não utilizá-las, nem permitir que terceiros utilizem tais Criações, a qualquer tempo, salvo se expressamente autorizado, por escrito, pela EMPREGADORA.



8.4. For all legal purposes, EMPLOYEE fully assigns and ratifies that in fact are assigned to EMPLOYER, on a free basis and in total, exclusive and definitive form, all property, title and practice rights on any and all Creations, including rights of authorship, and it is expressly agreed herein that the assignment of the said rights shall be freely and irrevocably valid within and outside the Brazilian territory, and conveys to EMPLOYER the right to modify, translate into any language, edit, publish, display, reproduce, adapt, distribute, perform, transmit and/or disclose, license and/or assign such rights to third parties, include referred Creations as part of a derivative work, composed and/or collective, organized by third parties or by EMPLOYER, at any time and unconditionally, and use such Creations (and/or the assigned rights) in any process, means or technique, such as photocopies, photographs, audio-video, phonograph, data communications, broadcasting (radio and television), satellite or any other process, whether digital, electromagnetic or not, including on-line transmission, available at the Internet.	8.4. Para todos os fins de direito, o EMPREGADO cede e ratifica estarem cedidos para a EMPREGADORA , integralmente, em base gratuita e em caráter exclusivo, total e definitivo, todos os direitos de propriedade e direitos patrimoniais de autor, uso e de exploração, sobre quaisquer Criações, ficando, neste ato, expressamente acordado que a cessão de tais direitos sobre tais Criações será válida dentro e fora do território brasileiro, em caráter irrevogável e em bases gratuitas, conferindo à EMPREGADORA o direito de modificar, traduzir para qualquer idioma, editar, publicar, exibir, reproduzir, adaptar, distribuir, praticar, transmitir e/ou revelar, licenciar e/ou ceder para terceiros tais direitos, incluir as referidas Criações como parte de um trabalho derivado, composto e/ou coletivo, organizado por terceiros ou pela EMPREGADORA , em qualquer ocasião e incondicionalmente, e usá-las (bem como os direitos ora cedidos) em qualquer processo, meio ou técnica, como técnica reprográfica, fotográfica, vídeo-fonográfica, fonográfica, comunicações de dados, transmissão (rádio e televisão), por meio de satélite ou qualquer outro processo, seja digital ou eletromagnético, incluindo on-line, disponível na Internet.

8.5. The Parties have previously agreed that EMPLOYER is allowed to unconditionally reproduce any works or Creations developed by EMPLOYEE as a result of the employment agreement with EMPLOYER and hereby assigned to EMPLOYER, even when not strictly consistent with the original work, and further waives citation of the author’s name.	8.5. Fica previamente acordado entre as Partes que é permitido à EMPREGADORA a reprodução incondicional de quaisquer obras ou Criações desenvolvidas pelo EMPREGADO por força do contrato de trabalho com a EMPREGADORA, e cedidas à EMPREGADORA pelo presente, mesmo que não esteja em absoluta consonância com a obra original, dispensando, também, a citação do nome do autor.



8.6. In the event EMPLOYEE is deemed by law or any other provision the holder of any of the aforementioned rights regarding any Creation, EMPLOYEE hereby agrees to (i) cooperate with EMPLOYER and assist it at no cost in its attempt to obtain and keep any governmental protection on said Inventions, and sign any and all documents that the EMPLOYER may need to this end; and (ii) sign any and all documents required for the effective fulfillment of the terms, conditions and guarantees agreed herein, including the exclusive assignment at no cost to EMPLOYER of the property rights, copyrights, patent rights and any other exclusive rights EMPLOYEE is entitled to or may be deemed the holder of, in relation to said Creations	8.6. Na eventualidade de o EMPREGADO ser considerado, por força de lei ou outra disposição qualquer, detentor de quaisquer dos direitos de que tratam os parágrafos acima com relação às Criações, o EMPREGADO desde já concorda (i) em cooperar com a EMPREGADORA e a assessorá-la, gratuitamente, na obtenção e manutenção de qualquer proteção governamental que esta vier a intentar para tais Criações, e a assinar todos os documentos que a EMPREGADORA venha a exigir para esse fim, e (ii) em firmar todo e qualquer documento necessário ao efetivo cumprimento dos termos, condições e garantias no presente pactuadas, inclusive em ceder para a EMPREGADORA , gratuitamente, de forma exclusiva, todos os direitos de propriedade, inclusive os de natureza patrimonial de autor, patentes e outros direitos exclusivos que o EMPREGADO possui ou venha a ser considerado possuidor com respeito a essas Criações.



8.7. Without prejudice to all other provisions in this Agreement, EMPLOYEE agrees that in the event his employment agreement with EMPLOYER is or may be characterized as a contract whose object is the creation of future works, pursuant to the provisions in Law 9.610/98 (Copyrights Law), more specifically article 51 of the aforementioned law, EMPLOYEE herein assigns to EMPLOYER all property rights, title and interests in such works, including copyrights, which EMPLOYEE may create in the next five (5) years during the employment agreement (if effective for such period), in which case the same provisions agreed to herein shall be applicable, especially those mentioned in the immediately aforementioned paragraphs. In the event the EMPLOYEE’s employment Agreement continues for more than five (5) years, EMPLOYEE agrees and undertakes to execute a new instrument before the expiration of such term, under the same terms and conditions agreed to herein, agreeing to fulfill all obligations and liabilities undertaken hereunder, namely, to transfer to EMPLOYER all his equity interest in any and all future works which may be created by EMPLOYEE during the term and as a result of his Employment Agreement with EMPLOYER.	8.7. Sem prejuízo das demais disposições deste Contrato, o EMPREGADO acorda que, no caso de seu contrato de trabalho com a EMPREGADORA ser ou vier a ser caracterizado como um contrato cuja função seja de criação de obras futuras, em conformidade com o que dispõe a Lei 9.610/98 (Lei de Direitos de Autor), mais precisamente o artigo 51 da citada lei, o EMPREGADO desde já cede à EMPREGADORA os direitos de propriedade, inclusive os patrimoniais de autor, uso e exploração sobre tais obras, que vierem a ser criadas por este nos próximos 5 (cinco) anos durante o contrato de trabalho (se vigente o seu contrato de trabalho por tal período), sendo aplicáveis, neste caso, os mesmos termos aqui pactuados, em especial as mesmas disposições de que tratam os parágrafos imediatamente acima. No caso do contrato de trabalho do EMPREGADO se estender por mais de 5 (cinco) anos, o EMPREGADO acorda e se obriga a firmar, previamente à expiração de tal prazo, um novo documento, nos mesmos termos e condições aqui pactuados, e assim sucessivamente, visando cumprir com as obrigações e responsabilidades no presente assumidas, ou seja, transferir à EMPREGADORA todos os seus direitos patrimoniais sobre toda e qualquer obra futura que vier a ser criada pelo EMPREGADO durante e por força de seu contrato de trabalho com a EMPREGADORA.



8.8 . Upon termination of this Agreement for whatever reason, or upon request by EMPLOYER at any time, EMPLOYEE must promptly return to EMPLOYER all of the EMPLOYER’s intellectual property and/or that which is qualified as EMPLOYER’ s property, which are under his possession, as well as any Creation, completed or not, including drawings, samples, drafts, ideas, concepts, illustrations, films, data, digital files and information, copies or other items, information or things created during the course of development of such Creations and/or the course of his services to EMPLOYER. EMPLOYEE shall not use any of EMPLOYER’ s intellectual properties nor any Creation for any purpose other than that expressly authorized in writing by EMPLOYER .	8.8. Mediante a rescisão de seu Contrato de trabalho, qualquer que seja o motivo, ou mediante solicitação da EMPREGADORA , a qualquer tempo, o EMPREGADO deverá entregar prontamente à EMPREGADORA toda a propriedade intelectual da EMPREGADORA e/ou que se qualifique como sendo de propriedade da EMPREGADORA , que esteja em sua posse, bem como qualquer Criação, concluída ou não, incluindo desenhos, modelos, rascunhos, ideias, conceitos, ilustrações, filmes, dados, arquivos digitais e informações, cópias ou outros itens, informações ou coisas criadas no curso do desenvolvimento de tais Criações e/ou de seus serviços à EMPREGADORA . O EMPREGADO não usará qualquer propriedade intelectual da EMPREGADORA nem qualquer Criação para qualquer outra finalidade que não a expressamente autorizada, por escrito, pela EMPREGADORA .

8.9 . In Exhibit 2, integrated in this Agreement, EMPLOYEE agrees to identify (without disclosing any trade secret or other confidential information regarding his exclusive property or that of a third party) all inventions or creations EMPLOYEE invented, conceived and/or developed and/or are in progress, before his employment agreement and/or services with EMPLOYER , that must be excluded from the scope or applicability of this Section of the Agreement, for having no relation to the EMPLOYER	8.9. No Anexo 2, que é parte integrante deste Contrato, o EMPREGADO concorda em identificar (sem revelar nenhum segredo de negócio ou qualquer informação confidencial de sua exclusiva propriedade ou de terceiros) todas as invenções ou criações que inventou, concebeu e/ou desenvolveu e/ou que estavam em desenvolvimento, antes do seu contrato de trabalho com a EMPREGADORA e/ou serviço para esta, que devem ser retiradas do escopo ou campo de aplicação desta Seção do Contrato, por não terem qualquer relação com a EMPREGADORA .

8.10 . The Parties hereto expressly agree that the list in Exhibit 2, referred to in the previous clause, is exhaustive, that is, EMPLOYEE herein acknowledges that all his inventions or creations, whether invented, conceived, developed and/or in progress were identified in Exhibit 2 of this Agreement, before his Employment Agreement with EMPLOYER .	8.10. Fica expressamente acordado pelas Partes que a lista do Anexo 2 de que trata a cláusula acima é exaustiva, ou seja, o EMPREGADO desde já reconhece que no Anexo 2 deste Contrato listou ou identificou todas as invenções ou criações que inventou, concebeu, desenvolveu e/ou que estavam em desenvolvimento, antes do seu contrato de trabalho com a EMPREGADORA .



CLAUSE 9 - SEVERABILITY OF THE AGREEMENTS	CLÁUSULA 9 - INDEPENDÊNCIA DAS CLÁUSULAS

9.1. EMPLOYEE hereby agrees that clauses 6, 7 and 8 of this Agreement (“Restrictive Covenants”) are reasonable according to a geographical and temporal perspective.	9.1. O EMPREGADO concorda que as cláusulas 6, 7 e 8 deste Contrato ("Cláusulas Restritivas") são razoáveis no propósito geográfico e temporal.

9.2. Any term, clause or provision of this Agreement which is not valid or not applicable, shall be null, without invalidating or rendering inapplicable the remaining clauses and provisions.	9.2. Qualquer termo, cláusula ou disposição deste Contrato que não tenha validade ou não seja aplicável, ficará sem efeito, sem com isto invalidar ou tornar inaplicáveis as cláusulas e disposições restantes.

9.3. The reach and scope of each provision hereof shall be construed only to the extent of its applicability.	9.3. A extensão e alcance de cada dispositivo do presente Contrato será interpretada somente na extensão de sua aplicabilidade.

CLAUSE 10 - TERMINATION	CLÁUSULA 10 - DA RESCISÃO

10.1. In addition to the motives provided for in Article 482 of the Labor Code, any breach of any of the clauses herein, in whole or in part, shall be cause for the termination of this Agreement, without the need of prior notice or any judicial or extra-judicial formality.	10.1. Além das causas previstas no artigo 482 da CLT, constituem justa causa para a rescisão de pleno direito do presente Contrato qualquer infração, no todo ou em parte, das cláusulas nele contidas, independentemente de notificação ou de qualquer formalidade judicial ou extrajudicial.

10.2. Should this Agreement be terminated by any of the parties hereto, the provisions in the legislation in effect shall prevail.	10.2. Para a rescisão deste Contrato, por qualquer das partes, prevalece o disposto na legislação vigente.

10.3. In the event of termination of this agreement without cause, due to the EMPLOYER’s initiative, the EMPLOYEE will be entitled to a dismissal indemnification in addition to mandatory severance provided by law, in a gross amount equivalent to 12 (twelve) monthly fix salaries at the time of termination, to be paid together with his mandatory severance payments.	10.3. Na hipótese do EMPREGADO ser demitido sem justa causa, por iniciativa da EMPREGADORA, o EMPREGADO fará jus ao pagamento de uma indenização de rescisão, em complemento às suas verbas rescisórias previstas em lei, em um valor bruto equivalente a 12 (doze) salários mensais fixos pagos à época da rescisão, a ser paga junto com suas verbas rescisórias.



10.3.1. In addition, if the EMPLOYEE is terminated without cause, within the first year of effectiveness of this Agreement, he will be entitled to maintain the status of beneficiary to the health plan offered by the EMPLOYER, or to a similar plan, with costs fully supported by EMPLOYER, for a period of twelve (12) months after the date of dismissal.	10.3.1. Em complemento, caso o EMPREGADO seja desligado sem justa causa durante o primeiro ano de vigência deste Contrato, ele terá direito à manutenção da sua condição de beneficiário do plano de saúde oferecido pela EMPREGADORA, ou a plano similar, custeado integralmente pela EMPREGADORA, durante o período de 12 (doze) meses após a data da rescisão.

CLAUSE 11 - GENERAL PROVISIONS	CLÁUSULA 11 - DISPOSIÇÕES GERAIS

11.1. A lack of application of any clause in this Agreement on the part of the EMPLOYER, in attending to special circumstances, shall not be construed as a contractual novation	11.1. Não constituirá novação contratual a falta de aplicação por parte da EMPREGADORA do pactuado em alguma cláusula deste Contrato, em atendimento a circunstâncias especiais.

11.2. Nothing in this Agreement should be construed as a waiver on the EMPLOYER’s part of any rights to which it is entitled at any time by legislation applicable hereto.	11.2. Nenhuma disposição do presente Contrato poderá ser interpretada como renúncia, por parte da EMPREGADORA, de qualquer direito a ela assegurado a qualquer tempo pela legislação aplicável a este Contrato.

11.3. The EMPLOYER may, according to its own discretion, grant benefits to the EMPLOYEE, provided that the granting of any and all benefits to the EMPLOYEE will be as a gratuity, as an assistance for work-related activities.	11.3. A EMPREGADORA poderá, a seu exclusivo critério, conceder benefícios ao EMPREGADO, sendo que a concessão de todo e qualquer benefício pela EMPREGADORA será considerada uma mera liberalidade, para auxílio às atividades desenvolvidas para o trabalho.

11.4. EMPLOYEE is aware of the Company’s regulations and Safety Standards that govern EMPLOYER’s activities and undertakes to use all safety equipment provided, when and if required, under the penalty of being punished for gross negligence, under the laws in effect.	11.4. O EMPREGADO fica ciente do regulamento da empresa e das Normas de Segurança que regulam suas atividades na EMPREGADORA e se compromete a usar os equipamentos de segurança fornecidos, se e quando necessária a utilização, sob pena de ser punido por falta grave, nos termos da legislação vigente.

11.5. In case of EMPLOYEE’s nonperformance of the terms and conditions agreed upon herein in relation to Clauses 6, 7 and 8 above (“Restrictive Covenants”), EMPLOYER is ensured the right to claim proven losses and damages caused to its assets.	11.5. No caso de descumprimento, pelo EMPREGADO, dos termos e condições no presente pactuado em relação às cláusulas 6, 7 e 8 acima ("Cláusulas Restritivas"), fica assegurado à EMPREGADORA o direito de reclamar perdas e danos comprovadamente causados ao seu patrimônio.



11.6. This Agreement shall be executed in two (2) counterparts of both versions in the Portuguese and English languages organized in columns. The parties agree that the Portuguese version shalt prevail in case of any controversy, or conflict of the terms and conditions herein agreed.	11.6. Este Contrato será celebrado em 2 (duas) vias, com ambas as versões em português e inglês dispostas em colunas. As partes concordam que a versão em português é a única versão válida no caso de divergência de interpretação dos termos e condições aqui estabelecidos.



AND FOR BEING JUST AND AGREED, the parties have executed this Agreement in two (2) identical counterparts of equal contents and form.		POR ESTAREM ASSIM, JUSTAS E AVENÇADAS, as partes assinam o presente Contrato, em duas (2) vias idênticas, de mesmo teor e forma.

Sao Paulo, January 28, 2016.		São Paulo, 28 de janeiro de 2016.

	/s/ Eddie De Oliveira		/s/ Eddie De Oliveira
	EMPLOYEE		EMPREGADO

	/s/ Juan Jose Chacon Quiros		/s/ Juan Jose Chacon Quiros
	EMPLOYER		EMPREGADORA



EXHIBIT 1 - JOB DESCRIPTION

The executive must develop the following activities: - Be responsible for managing all operations within the country. This involves taking responsibility for profit, revenue, cash and quality targets. - Agreeing annual budgets and producing a detailed quarterly business operating plan, as well as monthly, quarterly or annual targets for revenue, profits and cash. - Recruit and manage staff, including performance monitoring, mentoring and training. - Client facing and daily contact with clients and sub-distributors, and maintaining fluid communication effectively with the head office and the client base is essential. - Drive company growth and manage negotiations and improved relations with government health authorities. - Be responsible to work with different business development functions to establish strategies for future growth of the subsidiary business. - Develop annual business plans and monitor through quarterly reviews. - Manage key customer relationships and actively develop new business opportunities. - Manage the day to day operations with the personnel to ensure the operation is running efficiently.	O executivo deverá desenvolver as seguintes atividades: - Responsabilizar-se por todas as operações dentro do país. Esta atividade envolve responsabilizar-se por metas de lucro, receita, caixa e qualidade. - Definir orçamentos anuais e produzir planos operacionais de negócios trimestrais, bem como metas mensais, trimestrais ou anuais de receita, lucro e caixa. - Recrutar e gerir a equipe, inclusive monitorar o desempenho, orientar e dar treinamento. - Atender e manter contato diário com clientes e subdistribuidores e manter uma comunicação efetiva com a sede e a base de clientes, em essencial. - Conduzir o crescimento e administrar as negociações e a melhora contínua das relações com autoridades governamentais na área da saúde. - Ser responsável por atuar com diferentes frentes de desenvolvimento de negócios, para estabelecer estratégias de crescimento dos negócios da subsidiária. - Desenvolver o plano de Negócios anual e monitorar seu cumprimento trimestralmente. - Administrar o relacionamento com clientes-chave e desenvolver ativamente novas oportunidades de negócios. - Administrar as operações diárias da Empresa com os empregados, para garantir que as operações sejam desenvolvidas de forma eficiente.



- Direct subsidiary activities including budget plans and other reports. - Ensure sales plans are executed on time and on budget. - Provide leadership of all operations and sales and marketing activities. - Strive for operational excellence without compromising quality of the work to ensure best practices in place. - Ensure that company image is maintained and improved in the country. - Adhere to standard policies and procedures and acts as a role-model to all employees. - Perform other related duties and responsibilities as directed by the CEO and the board.	Comandar as atividades secundárias, inclusive aquelas relacionadas a planos de orçamento e outros relatórios. - Garantir que os planos de vendas sejam executados no prazo estabelecido, e dentro do orçamento estipulado. - Ter liderança no desenvolvimento de todas as atividades operacionais, bem como de vendas e marketing. Esforçar-se para obter excelência operacional sem comprometer a qualidade do trabalho para garantir a aplicação das melhores práticas de mercado. - Garantir que a imagem da empresa seja mantida e melhorada no país. - Aderir às políticas e procedimentos padrão da Empresa e agir como modelo para todos os empregados.



EXHIBIT 2 - INVENTIONS AND CREATIONS	ANEXO 2 - INVENÇÕES E CRIAÇÕES

There are no inventions or creations EMPLOYEE invented, conceived, developed and/or are in progress, before his employment agreement with EMPLOYER.	Não existem invenções ou criações que o EMPREGADO tenha inventado, concebido, desenvolvido e/ou que estejam em desenvolvimento, antes do seu contrato de trabalho com a EMPREGADORA.

Exhibit 10.9

DEVELOPMENT, SUPPLY & LICENSE AGREEMENT

THIS DEVELOPMENT, SUPPLY & LICENSE AGREEMENT (“Agreement”), dated as of the 13th day of December, 2011 (the “Effective Date”) is between AorTech International plc with its Affiliates’ principal place of business at 19725 South Diamond Lake Road, Rogers Minnesota 55374 (“AorTech”) on the one hand, and Establishment Labs, S.A., a Costa Rican corporation with its principal place of business at B15, Zona Franca Coyol, Alajuela, Costa Rica ( “EL”). AorTech and EL are referred together as the “Parties” or separately as a “Party.”

RECITALS

WHEREAS , AorTech has proprietary trade secrets, intellectual property, and know-how for the manufacture of silicone foam; and

WHEREAS , AorTech has certain patent and/or patent applications related to soft tissue implants, including breast implants; and

WHEREAS , EL is a manufacturer of breast implants and has proprietary trade secrets, intellectual property, and know-how for the manufacture of soft tissue implants, including breast implants; and

WHEREAS , EL desires to license from AorTech its know-how regarding silicone foam, and its patents regarding soft tissue implants, including breast implants;

WHEREAS, the Parties desire to cooperate to develop a low density silicone foam for soft tissue implants, and soft tissue implants utilizing the above foams; and

WHEREAS , AorTech manufactures Materials, as defined below, which may be suitable for use in manufacturing the foams and soft tissue implants developed pursuant to this Agreement; and

WHEREAS , EL desires to have the exclusive right to purchase the Materials for use in soft tissue implants, including breast implants; and

WHEREAS , AorTech is willing to grant an exclusive license to and under the Material in the Field to EL subject to the terms set forth herein;

NOW, THEREFORE , in consideration of the foregoing recitals and the mutual promises contained in this Agreement, the Parties agree as follows:

AGREEMENT

1. DEFINITIONS OF TERMS . As used in this Agreement the following terms shall have the following meanings:

1.1 "Affiliate" of a person or entity means any individual, sole proprietorship, firm, partnership, corporation, trust, joint venture or other entity, which directly or indirectly controls, is controlled by or is under common control with such person or entity. As used in this definition, “control” means the ownership of more than fifty percent of the entity.

1.2 “Confidential Information” shall mean any and all information, both technical and non-technical, relating to a Party's and its Affiliates’ respective businesses and affairs, finances, sales, products, customers, processes, strategies, techniques, trade secrets, research, development, inventions, testing procedures and marketing that has been or hereafter may be provided or shown to the one Party (the receiving Party) by the other party (the disclosing Party), irrespective of the form of the communication, and also includes all notes, analyses, compilations, studies, summaries and other materials prepared by the receiving Party containing, or based or derived, in whole or in part, on or from, any information of the disclosing Party included in the foregoing. Confidential Information includes samples and other materials and the results of any testing or analysis thereof. Confidential Information also includes the Foam Technology, the Soft Tissue Patents and the LD Implant Technology, except to the extent that any portion thereof is or becomes public information through patent applications.

1.3 “Effective Date” shall mean the date designated as such in the preamble to this Agreement.

1.4 “Field” shall mean a use for human soft tissue implants, including but not limited to breast implants, and for no other use whatsoever.

1.5 “Foam” shall mean silicone foam for soft tissue implants manufactured utilizing one or more of the Foam Technology, LD Implant Technology, the Soft Tissue Patents, and/or the Material.

1.6 “Foam Technology” shall mean AorTech’s proprietary trade secrets, intellectual property, and know-how for the manufacture of silicone foam for use in soft tissue implants.

1.7 “Implants” shall mean the breast implants and other soft tissue implants utilizing the Foam and the LD Implant.

1.8 “LD Implant” shall mean low density silicone soft tissue implants manufactured utilizing the LD Implant Technology.

1.9 LD Implant Technology” shall mean shall mean any invention, intellectual property, trade secret, know-how discovery, modification, adaptation, new use or improvement (whether patentable or not) invented, developed or made by a party during the Term of this Agreement, whether or not patented or patentable, regarding low density silicone soft tissue implants developed by the Parties pursuant to Section 6 of this Agreement. The LD Implant Technology does not include the Foam Technology.

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1.10 "Licensed Product(s)" shall mean all products, licenses, technology transfers, technology design or support services, or any revenue generating activity of EL in the Field that incorporate, rely on, or are made with the Foam, LD Implant, Foam Technology, the LD Implant Technology, the Soft Tissue Patents, or Materials.

1.11 “Materials (or ‘Material’)” shall mean AorTech’s proprietary Elast-EonTM and ECSILTM materials covered by AorTech’s patents for such materials.

1.12 “Net Sales” means the gross amounts of all revenue received by EL, its Affiliates, and any entity in which EL or its Affiliates have a direct or indirect ownership interest (i) from Licensed Products, including but not limited to all sales proceeds, lease proceeds, royalties, license fees, milestone payments, technology support fees, development fees and other income generated from soft tissue implants utilizing the Foam Technology, the LD Implant Technology, and/or the Material, and/or (ii) through manufacture, importation, use, or sale whose manufacture, importation, use, sale, but for the license granted to EL herein, would constitute an infringement of a subsisting claim of a Soft Tissue Patent or application (assuming the application becomes an issued patent); less the following deductions where applicable: (a) product and material returns; (b) normal and customary allowances actually given; (c) trade discounts actually given; and (e) transportation charges, duties and tariffs only if separately stated on an invoice; but before the deduction of sales and excise taxes, costs of insurance, and agents’ commissions.

1.13 “Soft Tissue Patents” shall mean the patents and patent applications of AorTech identified on Exhibit D hereto together with all pending and issued reissues, re-examinations, divisions, continuations, continuations-in-part, renewals, extensions, and all foreign counterparts and applications for foreign counterparts of the foregoing. If a patent application for a Soft Tissue Patent is not issued, the intellectual property and inventions disclosed in the patent application shall become part of the Foam Technology licensed to EL pursuant to this Agreement unless such intellectual property infringes on other unexpired issued patents.

1.14 “Term” shall mean the period commencing with the Effective Date and ending at the time prescribed by Section 11 hereof.

2. PAYMENTS AND ROYALTIES . In consideration of the provisions of this Agreement, EL shall make fixed payments and royalty payments to AorTech as set forth in Exhibit A.

3. LICENSE OF FOAM TECHNOLOGY .

3.1 Grant of License for Foam Technology. AorTech hereby grants to EL for the Term of this Agreement, unless terminated as provided herein, an exclusive, worldwide, non-sublicensable, right and license to use, market, sell, have sold, and offer for sale Licensed Products using the Foam Technology, which license is limited solely to the Field during the Term. This license does include the right for EL to manufacture Foam. EL shall not permit anyone else to use the Foam Technology without prior written approval from AorTech. The Foam Technology is Confidential Information and is subject to the protections of Section 12 of this Agreement.

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3.2 Best Efforts. EL agrees to use its best efforts to (a) develop Licensed Products utilizing the Foam Technology and obtain regulatory approval for those products, (b) meet the milestones and dates set forth in the Foam Implant Schedule attached hereto as Exhibit B, and (c) to market and distribute the Licensed Products in a manner designed to maximize Net Sales.

3.3 Delivery of Technology. Within 60 days after the date of this Agreement, AorTech shall deliver to EL written documentation for the Foam Technology. AorTech shall act as a consulting resource to EL regarding issues related to the formulation and manufacture of the Foam and obtaining regulatory approvals regarding the Foam. AorTech’s consulting shall include one visit to EL in to Costa Rica of up to five days regarding all consulting matters under this Agreement. If EL desires for further consulting visits, then EL shall pay all of AorTech’s expenses regarding such trips, including employee labor costs.

4. LICENSE OF SOFT TISSUE PATENTS .

4.1 Grant of License for Soft Tissue Patents. AorTech hereby grants to EL for the Term of this Agreement, unless terminated as provided herein, an exclusive, worldwide, non-sublicensable, right and license to use, market, sell, have sold, and offer for sale Licensed Products using the Soft Tissue Patents, which license is limited solely to the Field during the Term. This license does include the right for EL to manufacture Foam and Implants based on the Soft Tissue Patents. EL shall not permit anyone else to use the Soft Tissue Patents without prior written approval from AorTech. Except to the extent made public during the patent application process, the Soft Tissue Patents are Confidential Information and is subject to the protections of Section 12 of this Agreement.

4.2 Best Efforts. EL agrees to use its best efforts to (a) develop Licensed Products utilizing the Soft Tissue Patents and obtain regulatory approval for those products, (b) meet the milestones and dates set forth in the Foam Implant Schedule attached hereto as Exhibit B, and (c) to market and distribute the Licensed Products in a manner designed to maximize Net Sales.

4.3 Delivery of Technology. Within 60 days after the date of this Agreement, AorTech shall deliver to EL written documentation for the Soft Tissue Patents. AorTech shall act as a consulting resource to EL regarding issues related to the Soft Tissue Patents and obtaining regulatory approvals regarding the Soft Tissue Patents, subject to the limits set forth in Section 3.3.

5. SALE OF MATERIAL .

5.1 EL Right to Purchase Material. EL shall be entitled, but is not required, to purchase Material from AorTech on the terms and conditions of this Agreement for use by EL solely in the Field.

5.2 License Grant for Material. AorTech hereby grants to EL for the Term of this Agreement, unless terminated as provided herein, an exclusive, worldwide, non-sublicensable, right and license to use, market, sell, have sold, and offer for sale Licensed Products incorporating Material, which license is limited solely to the Field during the Term.

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This license does not include the right for EL to manufacture Material. EL shall not permit anyone else to use the Material without prior written approval from AorTech.

5.3 Limited License And Conditional Sales. The grant of the license to EL pursuant to this Agreement and all sales of the Material to EL are expressly conditioned on the following restrictions:

(a) EL shall not sell or transfer any Material to any person or entity exceptMaterial which is incorporated into a Licensed Product for use in the Field.

(b) EL shall only use the Material for the development and manufacture of Licensed Products for use in the Field.

5.4 Price of Material, Taxes. Pricing for Material sold to EL shall be as set forth in paragraph 4 of Exhibit A. All prices are exclusive of freight, exclusive of foreign and domestic federal, state and local excise, sales, use and similar taxes, and exclusive of import and export fees and duties. Such taxes, when applicable, will be billed as separate, additional items on AorTech invoices, unless EL provides AorTech with a properly executed tax exemption certificate.

5.5 Materials Orders and Shipments. During the term of this Agreement, AorTech agrees to use its commercially reasonable efforts to make and sell Materials to EL, according to EL’s requirements for Materials. EL shall notify AorTech upon submission for PMA, CE Mark, or any other regional regulatory approval for any Licensed Product utilizing the Material. Upon PMA, CE Mark, or other regulatory approval of any Licensed Product utilizing the Material, EL shall provide AorTech with quarterly 12 month rolling forecasts, which forecasts shall be reasonably made by EL. Purchases shall be initiated by EL’s written or electronically dispatched purchase orders (“PO”) referencing this Agreement and stating the quantity, the product, applicable price, shipping instructions and requested delivery dates. Requested Delivery dates shall be 2 months or greater from the date of the PO. AorTech shall confirm the quantity, product, price and delivery date of each PO within 5 business days of receipt of PO. All purchase orders placed by EL for Materials shall be governed by the terms and conditions of this Agreement. Any of EL's terms and conditions, other than those addressing the matters stated in the preceding sentence, however or whenever communicated, shall be of no effect, and are deemed rejected and objected to unless AorTech expressly accepts the additional terms. Acceptance of the PO shall not constitute acceptance of such terms. In the event of a conflict between the provisions of this Agreement and the terms and conditions of EL’s PO, the provisions of this Agreement shall prevail.

5.6 Order Issuance and Acceptance. AorTech shall accept or reject each PO issued under this Agreement by giving written notice to EL within five business days of receipt of the PO by AorTech.

5.7 Delivery Terms. All shipments shall be F.O.B. AorTech shipping dock EL’s PO shall specify the carrier or means of transportation or routing, and AorTech shall comply with

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EL’s instructions. If EL fails to provide shipping instructions, AorTech will make the selection. AorTech may make deliveries in installments provided the full amount of the order is delivered by the agreed due date. Partial shipments will be billed as made, and payments therefore are subject to the terms of payment noted below.

5.8 Title, Risk of Loss and Reserved Security Interest . Title and risk of loss or damage to the Materials shall pass to EL at the time AorTech delivers possession thereof to the carrier.

5.9 Payment. AorTech shall send invoices electronically to EL at or after the time of shipment for all amounts due under this Agreement. Each invoice is due and payable, and shall be paid, at AorTech offices within thirty (30) days after date of invoice. If EL is delinquent in payment of any invoices, AorTech may refuse to ship, require cash in advance, letters of credit or other terms, without limiting its remedies. EL shall make payment without regard to prior inspection of the Materials, but EL’s right of inspection shall not be impaired thereby.

5.10 U.S. Export Laws . AorTech’s obligations under this Agreement are subject to the export administration and control laws and regulations of the U.S. Government. EL shall comply fully with such laws and regulations in the export, resale or disposition of products. AorTech shall inform EL of any such law or regulation which imply an action or inaction of EL.

5.11 Sales Through Affiliate . AorTech shall be entitled to perform its supply obligations through its Affiliates.

6. LD IMPLANT DEVELOPMENT PROGRAM . The Parties agree to use their reasonable efforts to develop low density silicone implant(s) substantially having the characteristics set forth in Exhibit C (the “LD Implant Development Program”), and (b) after LD Implant is developed, to develop and obtain regulatory approvals for an LD Implant and other Licensed Products, and thereafter to market and distribute such LD Implants.

6.1 LD Implant Formulation. AorTech shall have primary responsibility for attempting to formulate and develop the manufacturing process for the LD Implant, and EL shall have primary responsibility for soft tissue implant devise issues and for evaluating and testing possible formulations for suitability of potential LD Implant formulations in Licensed Products. If the formulation and manufacturing process for LD Implant reasonably satisfactory to both Parties has not been developed by January 1, 2014, then either Party shall be entitled to give written notice to the other Party terminating the LD Implant Development Program.

6.2 Development of Licensed Products Utilizing LD Implant. After the formulation and manufacturing process for LD Implant has been approved by both parties, then EL agrees to use its best efforts to (a) develop and obtain regulatory approval for Licensed Products utilizing the LD Implant Technology, and (b) to market and distribute the Licensed Products containing the LD Implant Technology in a manner designed to maximize Net Sales. AorTech shall act as a consulting resource to EL regarding issues related to the formulation and manufacture of the LD Implant and obtaining regulatory approvals regarding the LD Implant, subject to the limits set forth in Section 3.3.

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6.3 Ownership, Use and Licensing of LD Implant Technology. The Parties anticipate that during the LD Implant Development Program and during the term of this Agreement following the LD Implant Development Program, the Parties or a Party may develop LD Implant Technology.

(a) EL shall be the sole owner of any LD Implant Technology for soft tissue implant devices, other than LD Implant Technology for silicone and polymer materials used therein. EL acknowledges that it is required to pay royalties to AorTech regarding soft tissue implant devises and other Licensed Products which contain LD Implant Technology, even if such LD Implant Technology is owned by EL pursuant to this Section 6.3(a) unless such LD Implant Technology owned by EL was developed solely by EL, and the soft tissue implant devices and other Licensed Products do not incorporate or rely on, and are not made with, other LD Implant Technology, Foam, Foam Technology, Soft Tissue Patents or Material.

(b) AorTech shall be the sole owner of any LD Implant Technology that relates to silicone and polymer materials, which shall include but is not limited to foams utilizing silicone or polymer materials, even if solely developed by EL.

(i) AorTech hereby grants to EL for the Term of this Agreement, unless terminated as provided herein, an exclusive, worldwide, non-sublicensable, right and license to use, market, sell, have sold and offer for sale Licensed Products using the LD Implant Technology solely owned by AorTech, which license is limited solely to the Field during the Term. This license does include the right for EL to manufacture LD Implant. EL shall not permit anyone else to use the LD Implant Technology without prior written approval from AorTech. The LD Implant Technology is Confidential Information and is subject to the protections of Section 12 of this Agreement.

(ii) EL grants to AorTech a license for the LD Implant Technology solely owned by EL, which license shall be limited to use by AorTech in performing its obligations related to this Agreement.

(d) If during the term of this Agreement, either Party (or its Affiliates) develops LD Implant Technology, then it shall forthwith notify the other in writing of the LD Implant Technology, describing the nature of such LD Implant Technology in reasonable detail. The Party owning the LD Implant Technology pursuant to Section 6.3(a) shall have the sole right to determine whether or not to seek a patent for the LD Implant Technology. Notwithstanding the foregoing, neither Party will be obligated to disclose LD Implant Technology to the other Party that (a) does not relate to the Licensed Products or the Field or (b) are the subject of early research and development efforts and thus not yet suitable for implementation in Licensed Products to be manufactured and supplied hereunder.

(e) Assignments of Inventions. Each Party shall have agreements with each of its employees and agents who will be participating in the LD Implant Development Program assigning all of the employee’s or agent’s rights in the LD Implant Technology to the

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Party, and requiring cooperation, including execution of assignments and patent applications if requested. Each Party agrees to assign all its rights in LD Implant Technology owned by the other Party pursuant to Section 6.3 to that Party.

6.4 Future Co-Development Program for High-Performance Low Cost Shell. The parties acknowledge that they anticipate adding a co-development program for a high‑performance, low cost breast implant shell in the future on terms which are mutually acceptable to the Parties. Neither Party shall have any obligations to the other party regarding that anticipated program until the Parties enter into a written agreement for such a co-development program.

7. TERMINATION OF EXCLUSIVITY RIGHT . Notwithstanding any other provision of this Agreement, EL’s exclusivity right in the Field regarding the Foam, Foam Technology, Soft Tissue Patents, LD Implant, LD Implant Technology and Material shall terminate, and AorTech shall be entitled to use, sell or license the Foam, Foam Technology, Soft Tissue Patents, LD Implant, LD Implant Technology and Material in the Field upon the first to occur of the events listed in 7.1 and 7.2 below. Following the termination of such exclusivity, the rights of EL in the Foam, Foam Technology, Soft Tissue Patents, LD Implant, LD Implant Technology and Material pursuant to this Agreement shall be non-exclusive thereafter until termination of this Agreement.

7.1 Termination for EL’s Failure to Use Best Efforts. EL’s exclusive rights shall terminate as provided in Section 7 above if EL fails to fulfill its obligations to use best efforts, determined in accordance with industry standard practices, as required pursuant to any of Sections 3.2, 4.2, or 6.2.

7.2 Termination for Failure to Pay Minimum Revenue Amounts. EL’s exclusivity right shall terminate as provided in Section 7 above if, after obtaining the CE Mark for the first to be obtained of the Foam Implant and LD Implant, EL fails to pay to AorTech total fixed payments, royalty payments, and Material purchases pursuant to Exhibit A, which all add up together to the amounts set forth below for the yearly periods beginning on the date the CE Mark is obtained:

1st Year - $250,000

2nd Year - $300,000

3rd Year - $350,000

4th Year - $400,000

5th Year and beyond - $500,000

8. EL OBLIGATIONS AND RESTRICTIONS .

8.1 Liability Insurance and Marks . EL and its Affiliates shall:

(a) Maintain a policy of product liability insurance in a commercially reasonable amount, determined on a market by market basis, for each market in which EL sells Licensed Products.

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(b) Mark all Licensed Products, or the packaging and/or manuals for such Licensed Products where it is impracticable to mark such Licensed Products directly, with the relevant patent numbers of the Soft Tissue Patents.

8.2 Design and Approvals. EL acknowledges that it is solely responsible for:

(a) The design and manufacture of any Licensed Products which utilize the Foam, the Foam Technology, LD Implants, the LD Implant Technology, Soft Tissue Patents, or Materials and which are manufactured, developed, tested or sold by EL or its Affiliates.

(b) The conduct of all tests, including biocompatibility, biostability and endurance to a standard required by the relevant regulatory authorities, for any Licensed Products which utilize the Foam, LD Implant technology, Soft Tissue Patents, or Materials and which are manufactured, developed, tested or sold by EL or its Affiliates.

(c) The obtaining of all regulatory approvals for any Licensed Products which utilize the Foam, LD Implant Technology, Soft Tissue Patents, or Materials and which are manufactured, developed, tested or sold by EL or its Affiliates.

8.3 No Sublicenses. EL shall have no sub-license rights under this Agreement, including but not limited to no right to sublicense the Foam Technology, Soft Tissue Patents, LD Implant Technology owned by AorTech, or the Material.

8.4 Experimental Nature of the Endeavor. It is specifically stated and understood by both Parties to this agreement that neither party is under an obligation to guarantee successful development of the Licensed Products or LD Technology. EL is engaged solely to attempt, to the best of the EL´s ability, to determine the most satisfactory methods, and if possible to design prototypes and methods for the manufacture of the Licensed Products. In any experimental endeavor, the possibility exists that a satisfactory answer may not be found, and that the value of efforts to determine this outcome is in preventing future loss in pursuit of an impractical goal. It is further stated and understood by both parties that EL is under obligation only to use reasonable diligence and its best efforts in applying professional experience and knowledge to the development of the Licensed Products, production methods and tooling, but cannot guarantee such results, nor warrant that satisfactory results are possible. Similarly, AorTech does not guarantee any particular results from AorTech’s consulting obligations or from AorTech’s efforts to formulate and develop the manufacturing process for the LD Implant. Certainty can only occur after development has been completed.

9. WARRANTIES, INSURANCE AND INDEMNIFICATION .

9.1 Warranty. AorTech warrants that all Materials sold to EL will be in compliance with AorTech’s standard specifications for the Materials as employed in the validation and registration of the Licensed Products. No changes to such specifications will be made by AorTech without EL’s approval. The warranties contained herein extend only to EL, and EL shall affirmatively disclaim all liability of AorTech to any end-users of Licensed Products, which disclaimer shall be

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reasonably satisfactory to AorTech. The SOLE AND EXCLUSIVE REMEDY for any breach of warranty or any certificate of analysis with respect to any Material shall be REPLACEMENT of the Material. The warranty contained herein shall not be deemed to have failed of its essential purpose so long as AorTech is making good faith efforts to correct defects under the terms of the warranty, or has made the replacements provided for.

EXCEPT FOR ANY EXPRESS WARRANTIES MADE IN THIS AGREEMENT NO WARRANTIES, EXPRESS OR IMPLIED, BY OPERATION OF LAW OR OTHERWISE, INCLUDING WITHOUT LIMITATION THE WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND INFRINGEMENT, ARE MADE BY AORTECH UNDER THIS AGREEMENT AND ALL SUCH OTHER WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED. THE PARTIES ACKNOWLEDGE THAT EL PROVIDED OR DETERMINED THE SPECIFICATIONS FOR THE COMPOSTION OF THE MATERIAL AND THE PERFORMANCE AND OTHER SPECIFICATIONS THEREFOR, AND THAT AorTech HAS NO RESPONSIBILITY FOR EL’S DETERMINATION TO USE THE MATERIALS IN THE LICENSED PRODUCTS.

AorTech warrants that it has complied, is complying with, and will comply with all applicable laws, rules, orders, ordinances, decrees, and regulations (collectively, the “Laws”) relating to the manufacture and packaging of the Materials pursuant to this Agreement. EL warrants that it has complied, is complying, and will comply with all the Laws relating to labeling, distribution, and sale of Licensed Products. AorTech warrants that to its actual knowledge its ability to manufacture the Material is not now the subject of any investigation, complaint, order, injunction, or decree of any court, governmental department, commission, board, bureau, or other instrumentality. AorTech certifies that the Material will be produced in compliance with all applicable labor and employment law requirements.

9.2 Inspection; Rejection and Acceptance. A certificate of analysis will accompany each shipment of Material. If EL believes any Material fails to conform to specifications set forth in the certificate or any warranty in this Agreement, EL shall notify AorTech of said failure as soon as practicable, and in any case within thirty (30) days of delivery at EL´s facilities. If EL fails to give notice within such period, the Materials shall be conclusively presumed to conform to all requirements. If any such failure is confirmed by AorTech, replacement Materials will be shipped free of charge. EL shall request a Return Materials Authorization (“RMA”) from AorTech before returning Materials for any reason. EL shall be responsible for packing, return shipment, inspection and labor costs in connection with the return of Materials, except when returned due to failure to conform to specifications. EL shall bear no costs for the return of rejected Materials not conforming to specifications. AorTech shall not be responsible for return of any Materials without authorization. All rejected Materials shall be returned to AorTech unless AorTech agrees in writing to another disposition, and EL must return Materials with original paperwork. The RMA numbers must be prominently displayed on the outside packing. Returned items should be packaged to prevent damage in transit in original containers. EL shall give AorTech a detailed statement of alleged deficiencies and shall otherwise comply with AorTech instructions contained in the RMA. AorTech shall have no liability for Products returned or otherwise disposed of by EL, where AorTech is unable to verify

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the alleged deficiency. Such returned Materials will be returned to EL at EL's expense, and EL shall pay AorTech costs of testing and evaluation.

9.3 Licensee’s Right to Quality Audit. Upon reasonable notice, EL may conduct on‑site quality audits of AorTech’s facilities involved in the manufacture of Licensed Materials and the accuracy and repeatability of AorTech’s certificates of analysis for Materials. Such audits shall be performed within AorTech’s regular working hours, and shall not exceed one (1) audit for each calendar year excluding follow-up efforts. Access to information by EL shall be limited to information that does not contain AorTech’s proprietary trade secrets, intellectual property, and know-how that is not licensed to EL under this Agreement. Without limitation, EL shall not have access to AorTech’s proprietary trade secrets, intellectual property, and know-how regarding the Material.

9.4 Limitation of Liability. Neither Party will be liable for a delay in performance of or failure to perform an obligation under this Agreement (except an obligation to make payment promptly when due), if and to the extent such delay or failure is attributable to any cause beyond the reasonable control of such Party (the “affected party”). Such causes may include, but are not limited to, strikes, lock-outs or other industrial disturbances; acts of terrorists or other public enemies; orders of any civil or military authority; insurrection; civil disturbances, sabotage; epidemics; seismic or meteorological events and their consequences; fires or explosions; partial or entire failure of utilities; fuel shortage; unavailability of supplies; or any other cause or event not reasonably within the control of the affected Party (“Force Majeure”). NO PARTY SHALL BE LIABLE TO ANY OTHER PARTY OR TO ANY THIRD PARTY FOR ANY INJURY OR DAMAGES TO BUSINESS, EARNINGS, PROFITS OR GOODWILL CAUSED DIRECTLY OR INDIRECTLY BY THE MATERIALS DELIVERED UNDER THIS AGREEMENT OR BY REASON OF ANY BREACH OF ANY WARRANTY OR OTHER PROVISION OF THIS AGREEMENT OR UNDER ANY OTHER THEORY OF LIABILITY, INCLUDING NEGLIGENCE OR STRICT LIABILITY; PROVIDED, HOWEVER, THIS LIMITATION SHALL NOT WAIVE ANY CLAIM ARISING FROM A PARTY’S GROSS NEGLIGENCE OR INTENTIONAL MISCONDUCT, AND DOES NOT APPLY TO ANY LIABILITY OF A PARTY IN RESPECT TO THE INDEMNIFICATION OBLIGATIONS CONTAINED HEREIN. NO PARTY SHALL BE LIABLE FOR ANY CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY, MULTIPLE OR OTHER DAMAGES OR PENALTIES, EVEN IF THE PARTY SHALL HAVE BEEN ADVISED OF THE POSSIBILITY OF THE SAME.

9.5 Indemnification. EL shall indemnify, defend and hold harmless AorTech and its Affiliates, and each of their shareholders, officers, directors, employees, agents, representatives, and predecessors from and against all losses, liabilities, claims, causes of action, and expenses (including attorneys’ fees and litigation costs), resulting from bodily injury (including death), or property damage arising out of or related to, or asserted to arise from (i) any Material which is the subject of this Agreement, or the use thereof, unless AorTech is determined by a court of competent jurisdiction to be the sole and exclusive cause of any loss, damage or injury to complaining third party, subject to the other terms of this Agreement, or (ii) any Licensed Product, or use thereof, including but not limited to claims in connection with or as a consequence of the design, manufacture, development, testing, distribution, sale or use of any Licensed Product.

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10. PATENTS AND INFRINGEMENT

10.1 Patents. Each Party may, but shall have no obligation to, prosecute applications and maintain patents covering LD Implant Technology owned by it pursuant to this Agreement. AorTech may, but shall have no obligation to, prosecute applications and maintain patents covering Materials. For Soft Tissue Patents which have not been issued, AorTech agrees to use reasonable efforts to pursue issuance of those patents, but does not warrant or represent that issuance will occur. If a Party elects to prosecute applications and maintain patents, that Party shall be responsible for any of its expenses, including attorney's fees, that it incurs in order to obtain or maintain the patent(s).

10.2 Notice of Infringement. The Parties shall promptly inform each other of any suspected infringement of any claims in any Soft Tissue Patents or misuse, misappropriation, theft or breach of confidence of other proprietary rights in the any Materials by a third party.

10.3 Warranty. AorTech warrants that, to the best of its knowledge, the Materials, the Foam Technology, components thereof and their materials and manufacturing processes, as the same may exist as of the Effective Date, do not infringe any third party patents or other intellectual property rights, and each Party shall reasonably cooperate with the other in any investigations undertaken to determine any potential infringement.

10.4 Remedy. In the event of a breach of the warranty given by AorTech in Section 10.3, AorTech shall take any one or more of the following actions, simultaneously or sequentially: (a) attempt to obtain for itself and the benefit of EL a license to manufacture, import, distribute, market, offer for sale and sell the allegedly infringing product, (b) permit EL to attempt to obtain for itself a license to manufacture and sell the allegedly infringing product with all additional costs incurred as a consequence of said license to be set-off against any payments EL may owe to AorTech.

10.5 Invalidity. AorTech warrants to EL that: (a) it has not received a third party claim of invalidity or unenforceability of any of the Soft Tissue Patents; and (b) it is unaware of any third party allegations of misappropriation of third party trade secrets by AorTech.

10.6 Suit. If any third party files a lawsuit alleging invalidity or unenforceability of the Soft Tissue Patents, or alleging that EL’s practice of the license granted pursuant to this Agreement infringes on the rights of the third party, then each Party agrees that it will not object to the other Party intervening in such lawsuit. Each party also agrees to reasonably cooperate with the other Party with respect to efforts to defend the Soft Tissue Patents and rights with respect thereto, so long as the requesting Party pays the cooperating Party’s reasonable costs and expenses of cooperation.

11. TERM AND TERMINATION .

11.1 Term. The Term of this Agreement shall commence on the Effective Date, and end on the earliest of the following events:

(a) any termination of this Agreement pursuant to its terms; or

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(b) any termination pursuant to Sections 11.2, 11.3, or 11.4 below.

11.2 Elective Termination. AorTech may terminate this Agreement if any of the following occur:

(a) EL fails to make the Royalty payments and other payments required by Section 2 and Exhibit A.

(b) The CE Mark for one of the Foam Implant or the LD Implant is not obtained by January 1, 2015, and the fixed payment associated therewith paid within 30 days thereafter.

(c) PMA approval for one of the Foam Implant or the LD Implant is not obtained by January 1, 2016, and the fixed payment associated therewith paid within 30 days thereafter.

11.3 Elective Termination by EL. EL may terminate this Agreement if, after fulfilling its best efforts obligations under Sections 3.2, 4.2 and 6.2:

(a) the CE Mark for one of the Foam Implant or the LD Implant is not obtained by January 1, 2015.

(b) PMA approval for one of the Foam Implant or the LD Implant is not obtained by January 1, 2016.

11.4 Termination by Consent or for Breach. This Agreement may be terminated at any time by the mutual written agreement of the Parties. In addition, either Party may terminate the Agreement, after providing written notice and sixty (60) days’ opportunity to cure, if the other Party breaches a material provision of this Agreement, except as provided in Section 7. AorTech and EL shall have the right, at their option, to cancel and terminate this Agreement in the event that the other party shall (i) become involved in insolvency, dissolution, bankruptcy or receivership proceedings affecting the operation of its business or (ii) make an assignment of all or substantially all of its assets for the benefit of creditors, or in the event that (iii) a receiver or trustee is appointed for EL and EL shall, after the expiration of thirty (30) days following any of the events enumerated above, have been unable to secure a dismissal, stay or other suspension of such proceedings. In addition, AorTech shall have a right to terminate this Agreement if EL ceases to purchase all its requirements of products meeting the description and specifications of the Materials from AorTech or an Affiliate of AorTech while AorTech has the capacity to meet such requirements. The failure of any party to exercise any right of termination or other right shall not be deemed to be a waiver of any right such party might have to exercise or enforce that right, upon any subsequent breach.

11.5 Effect of Termination. Any termination of this Agreement shall automatically terminate all licenses granted hereunder unless otherwise set forth herein. EL shall remain obligated for all royalties for Net Sales for periods prior to such termination, and for all other payments due prior to termination. Termination of this Agreement shall not, however, terminate the rights and obligations of the Parties under Sections 3, 9, 10 12, and 13 hereof. Any Licensed Products

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manufactured prior to the termination shall be considered licensed products and can be freely marketed by the parties, and royalties shall be paid according to the terms of this Agreement.

12. CONFIDENTIAL INFORMATION .

12.1 Protection of Information. In the performance of this Agreement AorTech and EL may exchange certain Confidential Information. The Parties shall use such information of the manner provided in Section 6 above. A Party shall disclose the Confidential Information of the other only to exercise its rights and to perform its obligations for the purposes of this Agreement. Additionally, each Party may use LD Implant Technology which is Confidential Information in the manner provided in Section 6 above. A Party shall disclose the Confidential Information of the other only to those of its employees, directors, agents or associates who have a reasonable need for such Confidential Information in connection with the permitted use of such Confidential Information. The receiving Party of Confidential Information shall inform its employees, directors, agents or associates who receive such Confidential Information of the terms of this Agreement, shall have written confidentiality and non-disclosure agreements signed by each person who has access to the Confidential Information, and shall take all necessary and appropriate actions to preserve the confidentiality of such Confidential Information, including, without limitation, placing suitable confidentiality legends on all Confidential Information so disclosed and using the same degree of care receiving Party exercises to protect its own proprietary or confidential information (but which in any event shall be not less than a reasonable standard of care). Each Party shall maintain a “Confidentiality Program” designed to protect the Confidential Information, which program shall include the protections set forth above. In addition to its duties set forth above, each Party agrees to incorporate into its Confidentiality Program such procedures and protections as are reasonably requested by the other Party. All documents, discs and other materials containing Confidential Information shall remain the sole property of the disclosing Party. The receiving Party shall promptly return all such materials on requests, but such return shall not affect the continuing obligations of the receiving Party hereunder.

12.2 Inspection and Audit Rights. Each Party shall have the right to inspect and audit the other Party’s Confidentiality Program and the other Party’s compliance with its obligations to protect the Confidential Information upon five day’s written notice to the other Party. If the inspection and audit discloses material breaches of a Party’s obligations under this Agreement, then in addition to other remedies available under this Agreement, the breaching Party shall pay the costs of the inspection and audit, and the costs of follow-up inspections and audits to confirm that the breaches under this Agreement have been cured.

12.3 Permitted Use. Nothing contained in this Agreement shall in any way restrict either Party’s right to use, disclose or otherwise deal with any Confidential Information which: (a) at the time of disclosure is generally available to the public, or thereafter becomes generally available to the public through no act of the receiving Party or its Affiliates in violation of this Agreement; (b) was in the possession of the receiving Party prior to the time of disclosure and such possession is documented by written evidence in existence at the time of such disclosure and was not acquired, directly or indirectly, from the disclosing Party; (c) is independently made available as a matter of right to the receiving Party by a third party lawfully entitled to possess such Confidential Information,

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provided such third party did not violate any legal obligation to the disclosing Party or any other person or acquire such Confidential Information directly or indirectly from the disclosing Party; or (d) the receiving Party is required to disclose under applicable laws or regulations or a court or other governmental order, provided that (i) except where impracticable, the receiving Party provides the disclosing Party with reasonable advance notice of such disclosure requirement and affords the disclosing Party opportunity to oppose or limit, secure confidential treatment for, such required disclosure, and (ii) the recipient discloses only that portion of the Confidential Information that the receiving Party is legally required to disclose.

12.4 News Releases. Each party shall consult with the other party before any news release or press conference concerning this Agreement or the license referred to in this Agreement, shall reasonably consider any requests by the other party that such news release or press conference be limited, and shall not include the name of the other Party without the other Party’s written consent except as allowed below. Any such news release or press conference may contain any information as may be required by any law, the London Stock Exchange, the Panel on Takeovers and Mergers, any applicable regulatory authority, or existing contractual arrangements to which the Licensor or the Licensee is subject.

13. GENERAL .

13.1 Governing Law and Jurisdiction. This Agreement shall be governed by the laws of the State of Utah without regard to conflicts of law principles. The Parties also agree that the United Nations Convention on Contracts for the International Sale of Goods does not apply to this Agreement. Jurisdiction and venue for any dispute shall be solely in the state and federal courts located in Salt Lake County, Utah unless AorTech elects to file an action in another court having jurisdiction over EL. EL hereby agrees that it is subject to the jurisdiction and venue of the state and federal courts located in Salt Lake County, Utah.

13.2 Complete Agreement; Modification. This Agreement, including its Exhibits, which are hereby incorporated by this reference, is intended as the complete, final and exclusive statement of the terms of the agreement between the Parties with regard to the subject matter hereof, and supersedes any and all agreements between them relating to the subject matter hereof. No modification, change, or amendment to this Agreement shall be effective unless in writing signed by both Parties, and no waiver of any rights in respect hereto shall be effective unless in writing signed by the Party to be charged.

13.3 Notices. Any notice or report required or permitted by this Agreement shall be deemed given if delivered personally or if sent by either Party to the other by internationally recognized courier, for overnight delivery. If by personal delivery or by courier, delivery shall be effective on receipt. Notices shall be transmitted as follows:

If to AorTech:

AorTech International plc

Attention: Frank Maguire, President

P.O. Box 526215

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Salt Lake City, UT 84152

Telephone: 801-201-4336

With a Copy to:

AorTech

Attention: Ajay Padsalgikar

19725 South Diamond Lake Road

Rogers, Minnesota 55374

If to EL:

Establishment Labs S.A.

B15, Zona Franca Coyol

Alajuela, Costa Rica

Attn: Juan José Chacón

Phone: +506 2434 2400

E-Mail: jchacon@establishmentlabs.com

13.4 Assignment and Successors. Neither Party shall assign this Agreement or any rights hereunder, or delegate any obligations hereunder, without the prior written consent of the other Party, except as expressly permitted hereby. Either Party shall be entitled to assign its interest in this Agreement and to delegate its obligations under this Agreement, in whole but not in part, in connection with a merger or other business combination in which it is not the surviving entity or to a party which acquires substantially all of the business and assets of the transferring Party which are related to the line of business which is the subject of this Agreement and which assumes in writing the transferring Party’s obligations hereunder, provided that any successor to EL shall have the capability to generate Net Sales which is reasonably equivalent to EL’s capability. Such assignment or delegation shall not relieve the transferring Party of its obligations hereunder, and such Party shall remain secondarily liable therefore. Subject to the foregoing, this Agreement shall bind and inure to the benefit of the Parties and their respective successors and assigns. Notwithstanding the above, AorTech shall be entitled to perform any or all of its obligations under this Agreement through its Affiliates.

13.5 Severability. In the event any provision of this Agreement is found to be invalid, illegal, or unenforceable, the validity, legality, and enforceability of any of the remaining provisions shall not in any way be affected or impaired thereby.

13.6 Compliance with Laws. The Parties shall at all times during the term of this Agreement and for so long as each shall sell Licensed Products or Material respectively, comply with all laws and regulations that apply to import, export, manufacture, use, sale, marketing, distribution and other commercial exploitation of Licensed Products, Material or any other activity undertaken pursuant to this Agreement.

13.7 Non-Waiver. The Parties covenant and agree that if a Party fails or neglects for any reason to take advantage of any of the terms provided for the termination of this Agreement

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or if a Party, having the right to declare this Agreement terminated, shall fail to do so, any such failure or neglect by such party shall not be a waiver or be deemed or be construed to be a waiver of any cause for the termination of this Agreement subsequently arising, or as a waiver of any of the terms, covenants or conditions of this Agreement or of the performance thereof. None of the terms, covenants and conditions of this Agreement may be waived by a Party except by its written consent.

13.8 Independent Contractors. The Parties hereby acknowledge and agree that each is an independent contractor and that neither Party shall be considered to be the agent, representative, master or servant of the other Party for any purpose whatsoever, and that neither party has any authority to enter into a contract, to assume any obligation or to give warranties or representations on behalf of the other party. Nothing in this relationship shall be construed to create a relationship of joint venture, partnership, fiduciary or other similar relationship between the parties.

13.9 U.S. Dollars. All references to amounts payable in this Agreement are to U.S. Dollars.

IN WITNESS WHEREOF, the Parties hereby execute this Agreement effective as of the Effective Date.

AorTech International plc

/s/ Frank Maguire

Frank Maguire, President

Establishment Labs, a Costa Rican corporation

/s/ Juan Jose Chacon

Juan Jose Chacon, CEO

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EXHIBIT A

SCHEDULE OF PAYMENT

[Intentionally Omitted]

-18-

EXHIBIT B

FOAM IMPLANT SCHEDULE

(to be developed and attached)

-19-

EXHIBIT C

LD IMPLANT GOALS

[Intentionally Omitted]

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EXHIBIT D

SOFT TISSUE PATENTS

Title: SOFT TISSUE IMPLANT



Country	Application Number	Official No.	Date Filed
Australia	2006349361	2006349361	10/10/2006
Brazil	PI0622149-1	PI0622149-1	10/10/2006
Canada	2665945	2665945	10/10/2006
European Patent Office	6790358.3	6790358.3	10/10/2006
Japan	2009-531692	2009-531692	10/10/2006
United States of America (abandoned)	12/444676	12/444676	10/10/2006

Title: GELS



Country	Application Number	Official No.	Date Filed
Australia	2005289374	2005289374	28/09/2005
Brazil	PI 0515934-2	PI 0515934-2	28/09/2005
China (granted)	200580032323.8	200580032323.8	28/09/2005
European Patent Office	5791328.7	5791328.7	28/09/2005
India	1026/KOLNP/2007	1026/KOLNP/2007	28/09/2005
Japan	2007-533824	2007-533824	28/09/2005
United States of America	11/663870	11/663870	28/09/2005

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Title: GELS



Country	Application Number	Official No.	Date Filed
Australia	2007242052	2007242052	19/04/2007
Brazil	PI0711694-2	PI0711694-2	19/04/2007
European Patent Office	7718758.1	7718758.1	19/04/2007
Japan	2009-505683	2009-505683	19/04/2007
United States of America	12/226508	12/226508	19/04/2007

Title: IMPLANTABLE PROSTHESIS



Country	Application Number	Official No.	Date Filed
United States of America	Provisional Patent Application No. 61/513211

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Exhibit 10.10

OEM/PLM SUPPLY AGREEMENT

This OEM/PLM and SUPPLY AGREEMENT (“Agreement”) is made by and between, Black Tie Medical, Inc., dba Tulip Medical Products (“TULIP”) and Establishment Labs S.A., a company organized and existing under the laws of Costa Rica (“ELSA”) as of July 31, 2016 (“Effective Date”) pursuant to the following terms, conditions and recitals:

RECITALS

WHEREAS, TULIP is in the business of manufacturing and selling medical devices typically used in connection with liposuction and fat transfer procedures in the cosmetic surgery field;

WHEREAS, TULIP presently sells its disposable and reusable devices through various distribution channels worldwide;

WHEREAS, TULIP owns several patents, trademarks, trade secrets and other intellectual property used in or in connection with its commercial operations;

WHEREAS, ELSA is in the business of manufacturing and selling medical products typically used in connection with breast augmentation procedures in the cosmetic surgery field on a global basis;

WHEREAS, ELSA has designed and developed proprietary products subject to patent applications and other intellectual property protections;

WHEREAS, ELSA has designed and is presently seeking patent and other intellectual property protections for a specific style of injector tip which can be combined with one or more types of TULIP proprietary cannula hubs to make a device (the “ELSA/TULIP PRODUCT”) convenient and marketable for use in connection with other ESLA products;

WHEREAS, ELSA desires to market an all-inclusive kit of medical devices and • other products which includes TULIP products and/or the ELSA/TULIP PRODUCTS;

WHEREAS, the parties wish to enter into a supply and OEM/PLM agreement under which TULIP will manufacture and deliver to ELSA prepackaged kits and individual products to be included in other ELSA kits which ELSA will then market to its customers on a worldwide basis; and

WHEREAS, the parties wish to respect and protect their respective intellectual property rights, including patents, trademarks and tradesecrets, relating to the individual devices covered by the supply and OEM/PLM agreement.

NOW, THEREFORE, IN CONSIDERATION OF THE ABOVE recitals, which are a material part of this Agreement, and the mutual promises and covenants contained herein, the parties agree as follows :

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BASIC TERMS OF THE AGREEMENT

1. Definitions . The following bold terms shall be defined as set forth below for purposes of this Agreement:


1.1	“ Affiliat e” means any company controlled by, controlling, or under common Control with Supplier.


1.2	“ Delivery Point ” means ELSA’s facilities located at Costa Rica, Alajuela, Coyol Free Zone 4th St, Building B-I5.


1.3	“ Product s” shall mean the products specifically listed in Exhibit “A”, the ELSA/TULIP PRODUCTS, and any other products that the parties from time to time hereafter may mutually agree to add to this Agreement, for TULIP to make and/or assemble and deliver to ELSA under the terms and conditions of this Agreement.


1.4	“ Trademark ” means any trademark, logo, or service mark, whether or not registered, used to represent or describe the Products of TULIP, including but not limited to those identified in the attached Exhibit “B”.

2. Appointment of Supplier .

2.1 During the term of this Agreement, ELSA shall regard TULIP as its preferred supplier for the Products and will purchase its requirements for the Products directly from TULIP.

2.2 TULIP will use best diligent efforts to search for methods and means that will lead to improvements, including cost reductions while maintaining the same or improved quality of the Products. ELSA will cooperate with TULIP in these efforts. ELSA shall comply with all applicable laws and regulations relating to the sale of the Products.

3. Agreement to Supply Products .

3.1 Supply and Purchase Agreement . TULIP Agrees to supply Products to ELSA and ELSA agrees to purchase Products from TULIP pursuant to the terms and • conditions of this Agreement. TULIP will cause the Products to be manufactured in accordance with applicable industry standards. TULIP also agrees that ELSA’s quality assurance group shall have the right from time to time upon reasonable written notice to perform quality audits of TULIP’s facilities (or the facilities of TULIP’s subcontractors) to ensure that the Products are manufactured in compliance with standard industry practices. All costs and expenses associated with such audits shall be the sole responsibility of ELSA. It is further understood that TULIP shall have primary responsibility for management of its suppliers and the resolution of technical issues.

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3.2 Changes. TULIP shall notify ELSA in writing and shall receive ELSA’s acceptance in writing, prior to the implementation of any material design change which differs from those designs used originally to produce the Products.

3.3 Additional Products . ELSA shall have the right to add additional Products of TULIP to this Agreement upon acceptance by TULIP.

3.4 Insurance . The parties represent and warrant that they have procured and will continue to maintain throughout the duration the of this Agreement and for four (4) years thereafter, appropriate liability insurance coverage issued by reputable insurance companies providing coverage for any and all claims arising out of or relating to the purchase, sale or use of any Products covered by this Agreement. Prior to placing the first order under this Agreement, the parties will make all necessary arrangements to have the other party named as an additional named insured under their respective policies and shall provide a certificate of insurance to the other party demonstrating that the carriers have made the required addition. All insurance policies shall insure against any and all claims, liabilities, costs or expenses resulting from or caused by (or claimed to be resulting from or caused by) any use or operation of any Products in the amount of at least one million (U.S. dollars) per claim, and one million (U,S. dollars) for claims in the aggregate. Each party shall bear all costs associated with procuring their respective insurance policies required by this agreement, including any cost or increased premium associated with naming the other party as an additional named insured.

4. Commercial! Terms and Pricing .

4.1 Purchase Orders . ELSA may place its orders for Products on ELSA’s Purchase Order forms. The terms and conditions printed on such Purchase Orders shall be complied with to the extent they are not inconsistent with any terms or conditions, or the stated intent, of this agreement. In the event any such terms and conditions conflict with the terms of this Agreement, then the terms and conditions of this Agreement shall prevail.

4.2 Ordering and Forecasts . ELSA shall specify its expected requirements for Products to be manufactured by TULIP under the terms of this Agreement by issuing a12-month rolling forecast on a monthly basis. The forecast shall indicate ELSA’s best estimate, on a monthly basis, as to the number of each of the Products which ELSA anticipates purchasing, and the shipment date when ELSA expects to need each of the Products. TULIP may, but is not required to manufacture up to 125% of the Products purchased quantities forecast by ELSA in order to have inventory on hand in the event ELSA underestimates its expected requirements (“Excess Inventory”). In the event ELSA elects to purchase Excess Inventory, TULIP is entitled to charge the Product’s contract price plus a 10% premium on such Excess Inventory.

This 12-month rolling forecast will be divided into the following three (3) periods:

4.2.1 Frozen Period : Within this rolling period, the delivery dates and quantities are fixed. This period will be the first four (4) week period of each forecast. ELSA commits to purchasing and receiving and not amending the

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specific weekly quantities within this rolling period, without prior agreement with TULIP Weekly quantities outside this period can be subject to change.

4.2.2 Variable Period : This rolling period is the eight (8) week period which follows immediately after the Frozen Period of each forecast. During this variable period, TULIP is allowed to purchase parts and, if necessary assemble Products, in order to meet the forecasted delivery dates for the Products. ELSA is obliged ultimately to purchase the Products specified for the variable period, but ELSA may elect to purchase such Products either during or after the variable period.

4.2.3 Informative Period : This period follows immediately after the variable period. The length of this period will be for the balance of the rolling twelve (12) month period. During this period, ELSA has no obligation to purchase any Product or parts.

4.3 Pricing .

4.3.1 TULIP shall sell to ELSA Product at a firm and fixed price per Exhibit “A” for one year, subject to adjustments set forth in Sections 4.3.2 and 4.3.3 as follows:

4.3.2 Following the end of the one (1) year fixed price period, and each year annually throughout the term of this Agreement, TULIP shall have the right to adjust the price structure for Products to reflect actual increases in production and related costs for Products as follows: If the cost to TULIP of any component parts of completed items for any Products to be supplied under this Agreement materially increases, TULIP may unilaterally adjust the pricing structure in Exhibit “A” to reflect the actual differential in price of such product to TULIP, which increased price will take effect at the next time TULIP completes an order for the affected Product(s) to ELSA. TULIP agrees use its best efforts to minimize any price increases, including, but not limited to, by finding alternate suppliers and purchasing materials in bulk and at other discounts. TULIP will provide written notice to ELSA of any permitted price changes at least 30 days prior to the effective date of any price change.

4.4 Packaging and Labeling . TULIP shall ship reusable and single-use sterile Products packaged in suitable containers for protection during shipments and for storage. The shipped Products will be labeled according to the standards agreed to by TULIP and ELSA prior to the initial shipment, which standards may be altered or modified from time to time by written agreement of both parties.

The parties understand and agree that certain governmental regulations, including but not limited to regulations of the U.S. Food and Drug Administration (“USFDA”), require that all packaging for OEM/PLM products must identify TULIP as the manufacturer and that ELSA cannot be identified as a manufacturer. The parties agree that all Products shipped pursuant to

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this Agreement will be properly labeled to identify TULIP as the manufacturer and ELSA (or its appropriate subsidiary or affiliates) as “Distributed by” or “Manufactured for” as the case may be ELSA (or its appropriate subsidiary or affiliates) understand that the Costa Rica Ministry of Health must be properly notified of the distributorship relationship, and ELSA shall be responsible for providing such notice of distributorship to the Costa Rica Ministry of Health for itself and any of its subsidiaries or affiliates who may receive Products under this Agreement.

All Products shall comply with and bear CE markings TULIP shall maintain such marking by complying with all applicable European regulations and requirements, including any amendments or modified thereof, throughout the term of this agreement. If at any time during the term, or thereafter, there shall be any situation that may compromise the CE marked status of the Products, TULIP shall inform ELSA within 48 hours of gaining knowledge.

4.5 Patents and Trademarks . ELSA acknowledges and covenants that TULIP’s SuperLuerLoks are marked with patent number identification, and that such marking shall not be removed or altered by ELSA. ELSA acknowledges and covenants that TULIP’s trademarks, trade names and branding is solely and exclusively the property of TULIP. Any use of TULIP’s trademarks, trade names and branding (including photos, images and other images used by TULIP in its marketing) must be approved in writing by TULIP prior to any use by ELSA. TULIP has provided a Style Guide (Exhibit C) to assist ELSA in the authorized use of the TULIP’s trademarks, trade names and branding.

4.6 Notice of Intellectual Property Infringement . In the event that ELSA discovers or becomes aware of any infringement of any patent, copyright, Trademark or other intellectual property right of TULIP, or any unauthorized use of TULIP marks or materials, ELSA shall promptly notify TULIP in writing of the details of such infringement or unauthorized as soon as reasonably practical after ELSA becomes aware. TULIP shall have the exclusive right in its sole discretion to institute any proceedings against such third party in its name and on its behalf. ELSA shall cooperate fully with TULIP in any legal action taken by TULIP against such third parties, provided that TULIP shall pay all expenses of such action and all damage relating to damage suffered personally by TULIP which may be awarded or agreed upon in settlement of such action shall accrue to TULIP.

In the event that TULIP discovers or becomes aware of any infringement of any patent, copyright, Trademark or other intellectual property right of ELSA, or any unauthorized use of ELSA marks or materials, TULIP shall promptly notify ELSA in writing of the details of such infringement or unauthorized as soon as reasonably practical after TULIP becomes aware. ELSA shall have the exclusive right in its sole discretion to institute any proceedings against such third party in its name and on its behalf. TULIP shall cooperate fully with ELSA in any legal action taken by ELSA against such third parties, provided that ELSA shall pay all expenses of such action and all damage relating to damage suffered personally by ELSA which may be awarded or agreed upon in settlement of such action shall accrue to ELSA.

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4.7 Purchaser Purchasing Rights and Obligations .

4.7.1 Affiliates and Subsidiaries . It is understood and agreed that purchases under this Agreement may be made directly from TULIP by ELSA’s parent, Affiliate and subsidiary companies, or by other entities authorized by ELSA in writing to TULIP, and the provisions contained herein shall be equally applicable to said purchases.

4.7.2 Sales, Service and Storage Facilities . ELSA shall, at its expense, engage and maintain a sales, service and parts handling organization, staffed with such experienced personnel as are necessary to enable ELSA to perform its obligations under this Agreement. ELSA shall, at its expense, at all times store and maintain its inventory of Products in accordance with current, applicable instructions issued by TULIP from time to time.

4.7.3 Customer Complaints . ELSA shall forward all complaints associated with the Products to TULIP within 48 hours of notification of ELSA by customers or clients. ELSA shall assist TULIP with complaint investigation and perform any corrective action as “directed” by TULIP in accordance with the ELSA complaint handling procedures.

4.7.4 Records . ELSA shall maintain records of all sales of any Products to third parties for a minimum of five (5) years after delivery of said Products by ELSA. Complete copies of these records will be provided to TULIP upon request or upon termination of the Agreement.

4.7.5 Export Controls . ELSA expressly acknowledges and understands that the technical data and the direct product thereof, including the Products, are subject to export controls of the United States and ELSA agrees that neither the technical data nor the direct product thereof, including the Products will be transferred, directly or indirectly, to any destination contrary to the laws of the United States, including but not limited to the terms of any export license and the terms of Part 774 (re-exports) of the U.S. Export Administration Regulations. Further, ELSA hereby provides its assurance that it will not participate in any transaction which may involve any commodity or technical data, or the direct product thereof, exported or to be exported from the United States, or in any re-export thereof, or in any other transaction that is subject to export controls of the United States, if a person denied export privileges from the United States may obtain any benefit from or have any interest in, directly or indirectly, these transactions.

4.8 Payment . ELSA shall pay a 50% non-refundable prepayment upon placement of each Purchase Order for each shipment of Products under this Agreement. The balance shall be paid prior to shipment from TULIP to ELSA.

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5. Damaged Product .

5.1 ELSA is entitled to reject any Product (or any component thereof) furnished by TULIP which is damaged. Promptly upon the receipt of a shipment of Products, ELSA shall examine the shipment to determine whether any item or items included in the shipment are in short supply, defective or damaged. Within 10 days of receipt of the shipment, ELSA shall notify TULIP in writing of any shortages, defects or damage, which ELSA claims existed at the time of delivery. Within 30 days after the receipt of such notice, TULIP will investigate the claim of shortages, defects or damage, inform ELSA of its findings, and deliver to ELSA Products to replace any which TULIP determines, were in short supply, defective or damaged at the time of delivery. Unless notice is given as provided in this Section, ELSA shall be deemed to have accepted such Products and to have waived all claims for shortages, defect or damage.

5.2 Products returned to TULIP in which no damage is found, or the damage was caused by ELSA, or an Affiliate or subsidiary or customer of Purchaser, shall be at the expense of ELSA. TULIP shall invoice ELSA for the costs incurred by TULIP for said damaged Products, such as freight charges, time, and materials.

6. Transfer of Title/Transportation. All Products shipped shall be FOB Black Tie Medical, Inc., San Diego, CA. Title will transfer to ELSA upon commencement of shipment of the Products by TULIP. ELSA shall pay the cost and insurance of transportation. Products shall be shipped to the Delivery Point, unless otherwise instructed by ELSA in writing prior to shipment. All shipments will be handled through United Parcel Service (“UPS”). No carrier other than UPS shall be used without the prior written approval of TULIP.

7. Force Majeure . Failure of either party to perform for this Agreement in whole or in part, shall be excused if such failure is the result of force majeure and acts of God, including, but not limited to, flood, wind and lightning, insurrections, strikes, riots, war and warlike operations, civil commotion, fires, explosions, accidents, the acts or orders of any governmental agency, acts of the public enemy, and laws or regulations or restrictions of the governmental entity or of any agency or instrumentality thereof.

8. Termination .

8.1 Following the Initial Term as set forth in Section 13, the parties to this Agreement may terminate this Agreement, for any reason and without cause, on not less than sixty (60) days prior written termination notice by the terminating party to the non-terminating party.

8.2 This Agreement may be terminated at any time upon mutual consent of the parties to this Agreement.

8.3 Either party may terminate this Agreement for material breach of any of its provisions by the other party upon thirty (30) days prior written notice to the other, if during such thirty (30) day notice period the default is not corrected to the reasonable satisfaction of the non-

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defaulting party. In addition, either party may immediately terminate this Agreement by giving the other party written notice if such other party has entered into or committed any act of liquidation, bankruptcy, insolvency, receivership or assignment for the benefit of creditors, to the extent such act is permitted by law.

8.4 Obligations Upon Termination .

8.4.1 Upon any termination of this Agreement, (i) both parties shall fully perform all of their obligations accruing up through the date of termination, and (ii) ELSA shall pay for all finished goods, work in process or raw materials inventory either on hand and non-returnable or on order and non-cancelable, purchased and/or manufactured as a result of ELSA’s purchase orders or written authorization to procure such material. ELSA shall have no obligation to purchase finished goods, work in process or raw materials that are outside the Frozen Period or Variable Period referenced in Sections 4.2.1 or 4.2.2 above.

8.4.2 To the extent applicable, the obligations under Sections 8.4, 9, 11 and 12 shall survive any termination of this Agreement for a period of ten (10) years after the termination of this Agreement.

9. Proprietary Information .

9.1 Confidentiality . The provisions and arrangements made under this Agreement are confidential between parties. Each party shall protect confidential information in the same manner it protects its own confidential materials. Neither party shall make any reference to this Agreement or any provision thereof in any publicly disseminated literature, printed matter, or other publicity issued by or for it, except (i) as required by law, (ii) in connection with a public or private offer or sale of securities, a business collaboration or transaction, or a governmental or industry regulatory communication, or (iii) in a fashion and at a time mutually agreed upon by both parties after the execution of this Agreement. After ELSA has sold Products in the ordinary course of business, TULIP may add ELSA to TULIP’s list of customers and may show • external photographs of Products for marketing purposes but may not disclose the other business terms of this Agreement to other third parties.

All Parties are committed to maintain secrecy of confidentiality, which shall be governed by the provisions of the Contract called “Mutual Non-Disclosure Agreement” signed by the Parties the 9 ^th of September the year two thousand and sixteen; said document is an integral part of this Contract and is hereby incorporated by this reference except to the extent that its terms conflict with the terms of this Agreement, in which case the terms of this Agreement shall control. The parties recognize that certain of the Products require labeling which identifies TULIP as the patent holder and/or manufacturer and such disclosure and labeling, shall not be considered a breach of the confidentiality requirements of this Agreement.

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9.2 Intellectual Property Rights.

9.2.1 Recognition of TULIP’s Rights . With the sole exception of the proprietary Sforza Bulb Side-Port Injector designed by ELSA to be incorporated into some of the Products pursuant to this Agreement, ELSA recognizes the proprietary interest of TULIP in the techniques, designs, specifications, drawings and other technical data now existing or which may be developed during the term of this Agreement, relating to the Products and their use. ELSA acknowledges and agrees that such techniques, designs, specifications, drawings and technical data relating to the Products and their use, whether developed by TULIP alone, in conjunction with others, or otherwise, shall be and is the property of TULIP. ELSA shall cooperate fully in communicating to TULIP or its agents the properly described above. ELSA hereby waives any and all right, title and interest in and to such proprietary information.

9.2.2 Recognition of ELSA’s Rights . TULIP recognizes the proprietary interest of ELSA in the techniques, designs, specifications, drawings and other technical data now existing or which may be developed during the term of this Agreement, relating specifically to the Sforza Bulb Side-Port Injector designed by ELSA, and TULIP acknowledges and agrees that such techniques, designs, specifications, drawings and technical data relating to the Sforza Bulb Side-Port Injector, whether developed by ELSA alone, in conjunction with others, or otherwise, shall be and is the property of ELSA. TULIP shall cooperate fully in communicating to ELSA or its agents the property described above. TULIP hereby waives any and all right, title and interest in and to such proprietary information. TULIP further recognizes that ELSA is currently in the process of perfecting ELSA’s ownership rights in the Sforza Bulb Side-Port Injector design and TULIP acknowledges such rights. Nothing in this agreement shall be construed as a license grant in favor of TULIP to use or sell the Sforza Bulb Side-Port Injector on any products outside of this Agreement or to any third parties.

In the event that ELSA abandons or is otherwise unable to secure patent protection for the design of the Sforza Bulb Side-Port Injector within four years of the effective date of this agreement, this Section 9.2.2, Section 9.3.2, and Section 9.5 will cease to have any effect, and the parties acknowledge that TULIP may manufacturer and sell products which may incorporate a Sforza Bulb Side-Port Injector without restriction or obligation to pay royalties or any other compensation to ELSA for such sales.

9.3 Further Inventions

9.3.1 To TULIP Products . As to any improvement to any of the Products which incorporate any TULIP proprietary information in any way, any component thereof, or any disposable used in connection therewith, which is made by ELSA’s employees or agents or anyone else, which improvement constitutes a patentable invention, (a) ELSA hereby agrees to promptly disclose

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the same to TULIP, (b) TULIP shall own all right, title and interest in such invention, (c) ELSA hereby agrees to cause the inventor to execute any assignments requested by TULIP in order to perfect TULIP’s ownership rights in the invention; and (d) ELSA shall cause said inventor to sign appropriate patent applications prepared at the expense of TULIP.

9.3.2 To ELSA Products . As to any improvement to any of the Products manufactured by TULIP for ELSA which are or which incorporate ELSA proprietary information which is made by TULIP’s employees or agents and which improvement constitutes a patentable invention, (a) TULIP hereby agrees to promptly disclose the same to ELSA, (b) ELSA shall own all right, title and interest in such invention, (c) TULIP hereby agrees to cause the inventor to execute any assignments requested by ELSA in order to perfect ELSA’s ownership rights in the invention; and (d) TULIP shall cause said inventor to sign appropriate patent applications prepared at the expense of ELSA. In the event ELSA elects to forgo pursuit of a patent for any such invention within 180 days after TULIP notifies ELSA of the improvement, the improvement shall be deemed to be an improvement to a TULIP product pursuant to Section 9.3.1 of this Agreement.

9.4 Nondisclosure . ELSA acknowledges and agrees that TULIP is entitled to prevent TULIP’s competitors from obtaining and utilizing TULIP’s trade secrets. ELSA agrees during the term hereof and thereafter to hold TULIP’s trade secrets and other confidential or proprietary information in strictest confidence and not to use them for purposes other than performance hereunder, and not to disclose them or allow them to be disclosed, directly or indirectly, to any other person or entity, other than to persons engaged by ELSA for the purpose of performance hereunder, without TULIP’s written consent. ELSA acknowledges the confidential nature of its relationship with TULIP and of any information relating to the Products, TULIP, or it distributors, agents, clients or customers which ELSA may obtain during the term hereof.

9.5 Sales to Third Parties . TULIP shall not sell any ELSA proprietary products manufactured by TULIP for ELSA under this Agreement to any third parties, including but not limited to any products incorporating the ELSA proprietary Sforza Bulb Side-Port Injector. However, nothing in this Agreement shall prohibit TULIP from selling TULIP products, including any TULIP products included in the Products manufactured for ELSA under this Agreement, to any other entity, and ELSA expressly acknowledges that TULIP does and shall continue to sell TULIP products on a wholesale and retail basis throughout the world.

MISCELLANEOUS PROVISIONS

10. Complete Agreement . The terms and conditions of this Agreement shall replace any previous terms and conditions between TULIP and ELSA relating to the Products. This Agreement constitutes the entire agreement between the parties on the subjects noted herein. This Agreement may not be modified except by written agreement executed by authorized representatives of both parties.

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11. Applicable Law and Dispute Resolution .

11.1 The construction, validity and performance of this Agreement shall be governed by the laws of the State of California, USA, excluding its principles regarding conflicts of law.

11.2 Any controversy or claim rising out of or relating to this Agreement, or the breach or interpretation hereof, shall be resolved through good faith negotiation between the executive officers of the parties hereto. Any controversy or claim not resolved by mutual agreement shall be submitted to binding arbitration in San Diego, California, in accordance with the rules of JAMS as then in effect; and judgment upon the award rendered in such arbitration shall be final and may be entered in any court having jurisdiction thereof. Notice of the demand for arbitration shall be filed in writing with the other party to this agreement and with JAMS. In no event shall the demand for arbitration be made after the date when institution of legal or equitable proceedings based on such claim, dispute, or other matter in question would be barred by the applicable statute of limitations. This Agreement to arbitrate shall be specifically enforceable under the prevailing arbitration law. The party most prevailing in said arbitration, as determined by the arbitrator based upon the parties’ representative claims and positions, shall be entitled to recover from the non-prevailing party all attorneys’ fees and other costs incurred in connection with the arbitration proceeding. In the event a party refuses or fails to participate in such arbitration, the other party may file a petition to compel arbitration in the Superior Court of the State of California or any other court having jurisdiction over the parties or the subject matter of the dispute, and both parties hereby consent to the jurisdiction of the courts of California for any purpose arising out of or relating to this Agreement and the subject matter thereof.

12. Indemnification .

12.1 TULIP INDEMNIFICATION OF ELSA . TULIP agrees, at its cost, to defend and hold ELSA, its Affiliates, and all officers, directors, employees and agents thereof harmless from any and all claims, demands, suits or actions (including attorneys’ fees incurred in connection therewith) which may be asserted against ELSA for damages, including without limitation damage or injury to property or persons and incidental and consequential damages, which may be sustained by any third party arising out of the design or manufacture of the Products, except with respect to claims of design defects relating to ELSA’s proprietary designs and injector tip. TULIP’s obligation to defend and indemnify ELSA for such claims shall not apply if the Products have been modified, misused or damaged by a third party, including but not limited to ELSA, or if such claim is caused by the gross negligence of ELSA.

12.2 ELSA INDEMNIFICATION OF TULIP . ELSA agrees to defend, indemnify, protect, save and hold harmless TULIP, its Affiliates, and all officers, directors, employees and agents thereof harmless from and against any and all claims, demands, suits or actions (including attorneys’ fees incurred in connection therewith) which may be asserted against TULIP for any kind of damages, including without limitation damage or injury to property or persons and incidental and consequential damages, which may be sustained by any third party arising out of or incidental to the conduct of ELSA’s operations, including but not limited to the handling, sale, marketing, promotion, or use of the Products, with the sole

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exception of claims of design or manufacturing defects by TULIP as provided for in Section 12.1 of this Agreement.

13. Term of Agreement . The Initial Term of this Agreement shall be three (3) years following the Effective Date hereof’. The term shall be automatically extended after the Initial Term for continuing one year terms until terminated in accordance with Section 8.

14. Assignment . Neither party may directly or indirectly assign or transfer this Agreement, in whole or on part, to any third party without the other party’s prior written consent, which consent shall not be unreasonably withheld or delayed. Notwithstanding the above, ELSA and TULIP may assign their respective rights and obligations hereunder to a subsidiary or Affiliate or to a purchaser of its business relating to the Products without the prior written consent of the other.

15. Severability . In the event of any provision of this Agreement shall be • invalid, void, illegal, or unenforceable, the remaining provisions hereof nevertheless will continue in full force and effect without being impaired or invalidated in any way.

16. Notices . Any notices from either party which affect this Agreement shall be in writing and sent by mail, fax, or telex to the address of the other party as set out below, or such other address as may from time to time have been notified in writing by either party in question to the other.

In the case of notices to ELSA:

Salvador Dada Santos
Coyol Free Zone 4th St, Building B-15
Alajuela, Costa Rica

In the case of notices to TULIP:

Marcille Pilkington
Tulip Medical Products
4360 Morena Blvd., Suite 100,
San Diego, CA 92117

17. Privity . The relationship established between TULIP and ELSA shall be solely that of seller and buyer, and neither party shall be in any way the agent or representative of the other party for any purpose whatsoever, and shall have no right to create or assume any obligation or responsibility of any kind, whether express or implied, in the name of or on behalf of the of the party to bind the other party in any manner whatsoever.

18. Validity of Agreement Signed in Counterpart . This Agreement may be signed in counterparts, each of which shall be an original, but all of which shall be deemed to be one and the same instrument, and shall be valid and binding when so signed. A party may evidence its signature and delivery by faxing a signed copy of this Agreement to the other party.

Confidential

IN WITNESS WHEREOF, the parties have caused their respective duly authorized representatives to sign this Agreement in counterparts, putting this Agreement in effect as of the date written above.



Black Tie Medical Inc., dba Tulip Medical Products

Signature:	/s/ Debbie Pilkington
Name:	Debbie Pilkington
Title:	Chief Operating Officer


Establishment Labs S.A.

Signature:	/s/Juan Jose Chacon
Name:	Juan Jose Chacon
Title:	CEO

[Signature Page to OEM/PLM Supply Agreement]

Confidential

Exhibit “A” PRODUCT PRICING

Pricing has already been supplied and a spreadsheet of it will be sent separately .

Confidential

Exhibit “B” TRADEMARKS

Tulip CellFriendly

SuperLuerLok

Tulip

GEMS

Tulip Gold Standard Fat Injection Set

Johnnie Snaps

Johnnie Lok

Tulip Power Handle

Pocar

Anaerobic Transfer

Power Adapter

NanoTransfer

NanoTransfer Cartridges

Tulip Crowns

Tulip SuperSpin

Tulip NanoSpin

Tulip Bulb Injector End Port

Tonnard Harvester

Sorensen Harvester

Sforza Harvester

Bensimon Harvester

Golsis Harvester

Carraway Harvester

Little Harvester

Trivisonno Harvester

Wall Basket

Wall Mercedes

Stevens Harvester

Schwarcz Flap infiltrator

Miller Harvester

SpoonTip Injector

Portless VDissector

Tulip Z Syringe Stands

Tulip Emulsifier

Tulip SoftPicks

Confidential

Exhibit “C” STYLE GUIDE

Confidential

Exhibit 10.11

Execution Copy

ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT (along with the exhibits and schedules hereto, this “ Agreement ”} is made as of November 6, 2015 by and among JAMM Technologies, Inc., a Delaware corporation (the “ Purchaser ”), Establishment Labs Holdings Inc., a British Virgin Islands company (the “ Parent ”) , and Magna Equities I, LLC, a Delaware limited liability company (the “ Holder ”). Certain terms used in this Agreement shall have the meaning ascribed to them in Section 9 hereof.

RECITALS

WHEREAS, VeriTeQ Corporation, a Delaware corporation, and together with its subsidiaries (collectively, the “ Company ”), is engaged in the business of researching, developing, manufacturing and selling radio frequency identification technologies for implantable medical devices (the “ Business ”);

WHEREAS, the Holder owns or holds $1,873,281.60 in aggregate outstanding principal amount of secured notes issued by the Company (the “ Secured Notes ”), representing 100% of the Company’s aggregate outstanding principal amount of secured notes;

WHEREAS, as a result of the Company’s default under the Secured Notes and other applicable transaction documents, the Holder, as holder of the Secured Notes, initiated disposition proceedings against the Company’s assets pursuant to Security and Pledge Agreement dated as of November 13, 2013, as amended, made by the Company, VertiTeQ Acquisition Corporation and PositivelD Animal Health Corporation in favor of the Holder as successor Collateral Agent, and Section 9-609 of the Uniform Commercial Code of the State of New York and the State of Illinois (the “ Disposition ”), and pursuant to a public disposition at an auction under Section 9-610 of the Uniform Commercial Code of the State of New York and the State of Illinois (the “UCC’), the Holder acquired the Transferred Assets (the “ Acquisition ”);

WHEREAS, the Holder owns or has the right to use all of the Transferred Assets; and

WHEREAS, on the terms and subject to the conditions set forth herein, the Holder desires to sell, transfer and assign to the Purchaser, and the Purchaser desires to purchase, acquire and assume from the Holder, the Transferred Assets in accordance with the terms and conditions of this Agreement.

AGREEMENT

NOW THEREFORE, in consideration of the mutual promises and covenants contained in this Agreement, the parties hereto agree as follows:

1. Transfer of Transferred Assets .

1.1 Transfer of Transferred Assets . Subject to the terms and conditions of this Agreement and in reliance on the representations, warranties and covenants set forth herein, at the Closing, the Holder agrees to sell or otherwise to convey, assign, transfer, deliver and set over to the Purchaser, and the Purchaser agrees to purchase, acquire and assume from the Holder, all of the Holder’s rights in, to and under all of the Transferred Assets, in each case free and clear of any Lien (other than Permitted Liens) or restrictions on transfer.

1.2 Method of Conveyance . The transfer and conveyance by the Holder of the Transferred Assets to the Purchaser in accordance with Section 1.1 shall be effected on the Closing Date at the Closing by the Holder’s execution and delivery to the Purchaser of instruments of transfer, including: (i) a bill of sale in form and content reasonably acceptable to the Purchaser (the “ Bill of Sale ”); and (ii) one or more assignments of the Proprietary Rights in form and content reasonably acceptable to the Purchaser (the “ Proprietary Rights Assignment ”).

1.3 Purchase Price . The aggregate purchase price for the Transferred Assets (the “ Purchase Price ”) shall be (a) cash in an amount equal to Three Hundred Thousand Dollars ($300,000.00) (the “ Cash Purchase Price ”), and (b) 130,354 shares of Class A Ordinary Shares (as defined below) (the “ Consideration Shares ”), which shares have the rights, privileges and preferences set forth in the memorandum and articles of association of the Parent (the “A/MA”). The Purchase Price shall be subject to increase or decrease pursuant to Section 8 hereof.

2. Closing: General . The closing (the “ Closing ”) shall take place at the offices of McDermott Will & Emery LLP, located at 28 State Street, Boston, Massachusetts 02109, at 10:00 a.m. on November 5, 2015 (the “ Closing Date ”} or on such other date or at such other time or location as the Holder and the Purchaser shall mutually agree. On the Closing Date, the Holder will sell, transfer and assign to the Purchaser, and the Purchaser will purchase, acquire and assume from the Holder, the Transferred Assets.

3. Representations and Warranties of the Holder .

For purposes of this Section 3, any reference to “Company” means the Company and, unless otherwise specified or reasonably apparent from the nature of the context in which such term is used, also means the Company’s Subsidiaries.

In order to induce the Purchaser and the Parent to enter into this Agreement and consummate the Transactions, the Holder hereby represents and warrants to the Purchaser and the Parent that, except as otherwise expressly disclosed on the corresponding Disclosure Schedule delivered to the Purchaser and the Parent and attached hereto (the “ Disclosure Schedules ”), the statements contained in this Section 3 are true, complete and correct.

3.1 Ownership of Secured Notes; Disposition: Acquisition of Transferred Assets .

(a) Ownership of Secured Notes . The Holder is the sole record and beneficial owner of the Secured Notes, which represent 100% of the Company’s aggregate outstanding principal amount of secured notes (the “ Secured Indebtedness ”).

(b) Right to Foreclose on Transferred Assets . The Holder filed UCC financing statements to perfect by filing the Holder’s security interests in the Transferred Assets. As a result of the Company’s default of its obligations to the Holder under the Secured Notes and applicable loan documents, the Holder delivered a notice of default to the Company on October 16, 2015. As a result of the Company’s default, the Holder had the right and was entitled to exercise rights and remedies against, and to dispose of, the Transferred Assets under applicable Law, its security agreement, and the other transaction documents, and acquired the Transferred Assets at a public disposition on November 4, 2015, which public disposition was in compliance with applicable Law.

(c) Acquisition of Transferred Assets . Pursuant to the Acquisition, the Holder acquired the Transferred Assets in accordance with applicable Law. The Disposition and the Acquisition were conducted by the Holder in full compliance with the UCC and all applicable Law.

(d) No Prohibition . To Holder’s Knowledge, as of the Closing Date, the Transactions are not prohibited by any Order, stay or injunction in any litigation, action by a Governmental Authority or other proceeding, including the “automatic stay” under 11 U.S.C. § 362 in any pending case under title 11 of the United States Code by or against the Company or the Holder.

(e) UCC Searches . In connection with the Disposition and the Acquisition, the Holder performed UCC searches against the Company (the “ UCC Searches ”) in order to locate liens of creditors who may have had an interest in the Transferred Assets (the “ Junior Creditors ”).

(f) Notice . The Holder took all actions necessary or desirable under the UCC to provide prompt notice of the Disposition and the Acquisition to necessary parties and to comply with all of the requirements under the UCC relating to the Disposition and the Acquisition. In connection therewith, the Holder has provided notice of the Disposition and Acquisition to the Junior Creditors, including Junior Creditors known to the Holder who have not filed financing statements regarding their liens, and other interested parties.

(g) Threatened Litigation . To the Holder’s knowledge, no Person, other than the Holder in respect of the Secured Indebtedness, Stroock, Stroock & Lavan LLP, in respect of the Stroock Claim and the Internal Revenue Service in respect of the Tax Damages has given a written notice of default to the Company, the Company’s Subsidiaries, the Holder or the Holder’s Affiliates with respect to any Indebtedness or written notice of breach by the Company or any of its Subsidiaries of their contractual obligations to such Person. The Holder has furnished to Parent a

list, which to the Holder’s Knowledge, is complete and correct, of the holders of the Company’s unsecured notes.

(h) Financial Statements . The financial statements of Guarantor provided to the Purchaser’s counsel on November 4, 2015 are true, complete and correct in all material respects and present fairly the financial condition of the Guarantor as of the times and for the periods referred to therein.

3.2 Organization and Standing . The Holder is a limited liability company, duly formed and validly existing under the Laws of the State of Delaware, and has the requisite power and authority to conduct its business as presently conducted, to execute, deliver and perform its obligations under this Agreement, and to carry out the Transactions. The Holder is duly qualified to do business and is in good standing in each jurisdiction in which the nature of the property owned or leased by it or the conduct of its business requires such qualification.

3.3 Authority for Agreement . The execution, delivery and performance by the Holder of this Agreement, and all other instruments and agreements to be executed by the Holder pursuant hereto, and the consummation by the Holder of the Transactions, have been duly authorized by all necessary action. This Agreement has been duly executed and delivered by the Holder and constitutes the legal, valid and binding obligations of the Holder, enforceable against the Holder in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization or other Laws of general application relating to or affecting the enforcement of creditors’ rights generally, and the effect of rules of law governing the availability of equitable remedies. The execution and delivery by the Holder of this Agreement, and the performance by the Holder of the Transactions, (a) will not violate any Law, statute, rule or regulation applicable to the Holder and (b) will not conflict with or result in a breach of any term, condition or provision of, constitute a default under, give any third party the right to accelerate any obligation under, result in a violation of, or require any authorization, consent, approval or other action by or notice to any Governmental Authority pursuant to, the governing documents or any agreement to which the Holder is a party or by which it or any of its assets is bound, or any Order, applicable to the Holder or its assets, or, result in the creation or imposition of any Lien upon the Transferred Assets, or the suspension, revocation, impairment, forfeiture, or non-renewal of any material License applicable to the Holder, its business or operations, or any of the Transferred Assets.

3.4 Consents and Approvals . No consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any Governmental Authority is required on the part of the Holder in connection with the consummation of the Transactions. No consent, approval or authorization of any non-governmental third party is required in order to consummate the Transactions or perform the related covenants and agreements contemplated hereby. The Holder has received all consents, approvals or authorizations which, if not received, would result in the termination of any contract or agreement listed (or required to be listed) on Schedule 3.4 or would permit a counterparty to terminate any such contract or agreement.

3.5 Litigation . With the exception of the Stroock Claim, (a) no Action is pending or,to the Holder’s Knowledge, threatened against the Holder or any of the officers, directors or

employees of the Holder, which is related to the Transferred Assets or operations of the Holder, or the consummation of the transactions contemplated hereby, and (b) to the Holder’s Knowledge, no Action is pending or threatened against the Company or any of its Subsidiaries or any of their respective officers, directors or employees, which is related to the Transferred Assets or operations of the Company or any of its Subsidiaries, or the consummation of the transactions contemplated hereby. The Holder is not a party or subject to the provisions of any Order of any Governmental Authority. To the Holder’s Knowledge, neither the Company nor any of its Subsidiaries is a party or subject to the provisions of any Order of any Governmental Authority that would adversely affect its ability to consummate the transactions contemplated hereby. Other than the Disposition, there is no Action by the Holder or any of its Affiliates currently pending or which the Holder or any of its Affiliates intends to initiate with respect to the Company, the Company’s Subsidiaries or the Business.

3.6 Assets and Properties . The Transferred Assets were acquired in the Disposition and the Acquisition on an as-is, where-is basis and are being purchased and sold hereunder on the same basis, free and clear of any Liens arising out of Holder’s ownership of the Transferred Assets and of any liabilities of Holder unrelated to the Business, the Transferred Assets or the transactions contemplated hereby. The Holder has good and marketable title to, or a valid leasehold or license to, all Transferred Assets free and clear of any Lien (other than Permitted Liens) or restrictions on transfer, and has the legal right to use all Transferred Assets. Upon completion of the Transactions, the Purchaser will acquire good title to all of the Transferred Assets, free and clear of any Liens (other than Permitted Liens).

3.7 [ Intentionally Deleted ]

3.8 Material Contracts and Obligations . To the Holder’s Knowledge, other than contracts between the Company or its Subsidiaries, on the one hand, and the Purchaser or its Affiliates, on the other hand, the Transferred Assets do not include any agreements or contracts.

3.9 Brokers or Agents . No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the Transactions based upon any agreement or understanding alleged to have been made by such person directly or indirectly with the Holder or, if applicable, any of the Holder’s officers, managers or employees, in connection with any of the Transactions.

3.10 Solvency . Immediately after giving effect to the Transactions, the Holder: (a) will not be engaged in any business or transaction for which it has unreasonably small assets or capital (within the meaning of the Uniform Fraudulent Transfer Act, the Uniform Fraudulent Conveyance Act and section 548 of the Federal Bankruptcy Code); and (b) will be able to pay its debts as they mature. No transfer of Transferred Assets is being made and no obligation is being incurred in connection with the Transactions with the intent to hinder, delay or defraud either present or future creditors of the Holder, the Company, the Company’s subsidiaries or any holders of equity or debt of the Company or any of the Company’s subsidiaries.

3.11 Purchase Entirely for Own Account . This Agreement is made with the Holder in reliance upon the Holder’s representation to the Purchaser and the Parent, which by the Holder’s execution of this Agreement, the Holder hereby confirms, that the Consideration Shares to be acquired by the Holder will be acquired for investment for the Holder’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Holder has no present intention of selling, granting any participation in, or otherwise distributing the same. By executing this Agreement, the Holder further represents that the Holder does not presently have any contract, undertaking, agreement or arrangement with any Person to sell, transfer or grant participations to such Person or to any third Person, with respect to any of the Consideration Shares. The Holder has not been formed for the specific purpose of acquiring the Consideration Shares. The Holder acknowledges that it is not relying upon any Person, other than the Parent and its officers and directors, in making its investment or decision to invest in the Parent.

3.12 Disclosure of Information . The Holder has had an opportunity to discuss the Parent’s business, management, financial affairs and the terms and conditions of the offering of the Consideration Shares with the Parent’s management and has had an opportunity to review the Parent’s facilities.

3.13 Restricted Securities . The Holder understands that the Consideration Shares have not been, and will not be, registered under the Securities Act of 1933, as amended (the “ Securities Act ”), or the securities laws of any state or jurisdiction, by reason of a specific exemption from the registration provisions of the Securities Act, or the securities laws of any state or jurisdiction, which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Holder’s representations as expressed herein. The Holder understands that the Consideration Shares are “restricted securities” under applicable U.S. federal and state securities laws and that, pursuant to these laws, the Holder must hold the Consideration Shares indefinitely unless they are registered with the Securities and Exchange Commission or another exchange and qualified by state authorities, or an exemption from such registration and qualification requirements is available. The Holder acknowledges that the Parent has no obligation to register or qualify the Consideration Shares for resale. The Holder further acknowledges that if an exemption from registration or qualification is available, it may be conditioned on various requirements including, but not limited to, the time and manner of sale, the holding period for the Consideration Shares, and on requirements relating to the Parent which are outside of the Holder’s control, and which the Parent is under no obligation and may not be able to satisfy.

3.14 No Public Market . The Holder understands that no public market now exists for the Consideration Shares, and that the Parent has made no assurances that a public market will ever exist for the Consideration Shares.

3.15 Accredited Investor . The Holder is an accredited investor as defined in Rule 501(a) of Regulation D promulgated under the Securities Act.

3.16 No General Solicitation . Neither the Holder, nor any of its officers, directors, employees, agents, stockholders or partners has either directly or indirectly, including, through a

broker or finder (a) engaged in any general solicitation, or (b) published any advertisement in connection with the offer and sale of the Consideration Shares.

3.17 Risks . The Holder has reviewed and understands the risks of, and other considerations relating to, its acquisition of the Consideration Shares and investment in the Parent. The Holder, either individually or with its representative(s), has such knowledge and experience in financial and business matters that it is able to evaluate the merits and risks of acquiring the Consideration Shares and investing in the Parent and to make an informed investment decision. The Holder has adequate means of providing for its current needs and possesses the financial resources to bear the risk of economic loss with respect to the Consideration Shares acquired and the investment in the Parent.

3.18 Information . In making its investment decision, the Holder has relied on no oral or written representations with respect to the Consideration Shares, the Parent, its business or prospects, or other matters, except as expressly set forth herein. The Holder confirms that neither the Parent, nor any of its officers, directors, shareholders, Affiliates or agents has made any representations or warranties concerning its investment in the Parent including, without limitation, any representations or warranties concerning the return he, she or it may receive on its investment in the Parent, or tax consequences that may arise in connection with its investment in the Parent. In making its decision to invest in the Parent, the Holder has relied upon independent investigations made by the Holder and by its professional advisors. The Holder and its advisors have been furnished any and all nonproprietary materials available to the Parent and have been afforded the opportunity to ask questions concerning the Parent, its proposed business and any other matters relating to the formation of the Parent, and the offer and sale of the Consideration Shares. The Holder has also been afforded the opportunity to obtain any additional nonproprietary information, to the extent the Parent possesses that information or can acquire it without unreasonable effort or expense, and has the right to furnish it to the Holder, necessary to verify the accuracy of any representation or information contained in this Agreement.

4. Representations and Warranties of the Purchaser and the Parent . In order to induce the Holder to enter into this Agreement and consummate the Transactions, each of the Purchaser and the Parent hereby represents and warrants to the Holder that the statements contained in this Section 4 are true, complete and correct:

4.1 Organization and Authority . Each of the Purchaser and the Parent is an entity duly formed and validly existing under the Laws of the jurisdiction of its incorporation. Each of the Purchaser and the Parent has the requisite power and authority to enter into and to perform this Agreement and each of the other Transaction Documents in accordance with their respective terms. This Agreement and all other agreements to be executed by each of the Purchaser and the Parent pursuant to this Agreement and the other Transaction Documents to which it is party have been duly executed and delivered by the Purchaser or the Parent, as the case may be, and constitute valid and binding obligations of the Purchaser or the Parent, as the case may be, enforceable against it in accordance with their respective terms, except as may be limited by applicable bankruptcy, insolvency, reorganization or other Laws of general application relating to or affecting the

enforcement of creditors’ rights generally, the effect of rules of law governing the availability of equitable remedies. The execution and delivery by each of the Purchaser and the Parent of this Agreement, and the performance by each of the Purchaser and the Parent of the Transactions, will not violate any Law, statute, rule or regulation applicable to the Purchaser or the Parent, as the case may be.

4.2 Brokers or Agents . No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the Transactions based upon any agreement or understanding alleged to have been made by such person directly or indirectly with the Purchaser or the Parent or, if applicable, any of the officers, directors or employees of the Purchaser or the Parent, in connection with any of the Transactions.

5. Representations and Warranties of the Parent . In order to induce the Holder to enter into this Agreement and consummate the Transactions, the Parent hereby represents and warrants to the Holder that the statements contained in this Section 5 are true, complete and correct:

5.1 Capitalization . As of immediately prior to the Closing, the authorized capital stock of the Parent will consist of (a) 4,940,143 Class A Ordinary Shares, $1.00 par value per share (the “ Class A Ordinary Shares ”), of which, immediately prior to the Closing, all of which shares were issued and outstanding, (b) 1,646,714 Class B Ordinary Shares, $1.00 par value per share, of which, immediately prior to the Closing, all of which shares were issued and outstanding, and (c) 7,364 Preferred Class Z Shares, $500.00 par value per share, of which, immediately prior to the Closing, none of which shares were issued and outstanding. Except as reflected in the capitalization table attached hereto on Schedule 5.1 , no subscription, warrant, option, convertible security or other right (contingent or otherwise) to purchase, acquire or receive any shares of capital stock or other equity interest of the Parent is authorized or outstanding, and the Parent has no obligation (contingent or otherwise) to issue any subscription, warrant, option, convertible security or other such right or to issue or distribute to holders of any of its shares of capital stock any evidences of indebtedness or assets of the Parent.

5.2 Issuance of Shares . The issuance, sale and delivery of the Consideration Shares in accordance with this Agreement have been duly authorized by all necessary action on the part of the Parent. The Consideration Shares, when issued and paid for in accordance with this Agreement, will be duly and validly issued, fully paid and nonassessable. Assuming the accuracy and completeness of the representations of the Holder hereunder, the Consideration Shares will have been offered and issued, as of the Closing Date, in compliance with applicable securities Laws and in compliance with the M &A. Upon consummation of the Transactions and the registration of the Consideration Shares in the name of the Holder in the stock records of the Parent, the Holder will own the Consideration Shares free and clear of all Liens, except as set forth in the M &A. The number of Consideration Shares issuable hereunder was determined based on a $5.37 per Consideration Share value, which represents a $40 million pre-money valuation based on the number of issued and outstanding shares of capital stock of the Parent, as well as shares reserved under the equity option plan of the Parent, each as of the date hereof.

5.3 Share Purchase Agreement Representations and Warranties . The representations and warranties (as modified by Disclosure Schedules (as defined in the Share Purchase Agreement)) set forth in Section 3 of that certain Share Purchase Agreement, dated as of August 28, 2015, by and among the Parent, CPH TU, LP, and Marmoniel LLC (the “ Share Purchase Agreement ”), were accurate in all material respects on August 28, 2015. Since August 28, 2015, there has been no Material Adverse Effect (as defined in the Share Purchase Agreement).

6. Closing Deliveries .

6.1 Deliveries of the Holder . At the Closing, the Holder will deliver or cause to be delivered to the Purchaser:

(a) Conveyance Documents . The Bill of Sale and the Proprietary Rights Assignment executed by the Holder, and such other deeds, bills of sale and other instruments of assignment as the Purchaser reasonably deems necessary in order to effect the sale of the Transferred Assets to the Purchaser.

(b) Transfer Statement . A transfer statement pursuant to Section 9-619 of the UCC and any other documentation reflecting the Holder’s compliance with the UCC provisions relating to a public disposition of the Transferred Assets.

(c) Certificates of Good Standing . A certificate as to the legal existence of the Holder issued by the Secretary of State of the State of Delaware.

(d) Secretary’s Certificate . A certificate of the Secretary of the Holder certifying as to (i) the resolutions of the managers of the Holder, authorizing and approving all matters in connection with this Agreement and the Transactions, and (ii) signature specimens of the duly elected officers of the Holder authorized to execute and deliver this Agreement and the incumbency of each such officer.

(e) FIRPTA Certificate . Affidavit of non-foreign status, in form and content reasonably acceptable to the Purchaser, for the Holder that complies with Section 1445 of the Internal Revenue Code of 1986, as amended (the “Code”), and the Treasury Regulations thereunder.

(f) Other Required Documents . All other documents required to be delivered by the Holder on or prior to the Closing pursuant to this Agreement.

6.2 Deliveries of the Purchaser and the Parent . At the Closing, the Purchaser or the Parent, as the case may be, will deliver or cause to be delivered:

(a) Cash Purchase Price . By the Purchaser to the Holder, an amount of cash equal to the Cash Purchase Price, by wire transfer in immediately available funds to the account of the Holder that the Holder shall have designated at least twenty-four (24) hours prior to the Closing.

(b) Consideration Shares . By the Parent to the Holder, a certificate or certificates representing the number of Consideration Shares, registered in the name of the Holder.

(c) Other Required Documents . To the appropriate party, all other documents required to be delivered by the Purchaser or the Parent on or prior to the Closing pursuant to this Agreement.

7. Covenants and Additional Agreements .

7.1 Tax Matters .

(a) Transfer Taxes . All transfer, documentary, sales, use, stamp, registration and other similar taxes and fees (including any penalties and interest) incurred in connection with the purchase and sale of the Transferred Assets pursuant to this Agreement shall be borne and paid by the Holder, and the Holder shall file all necessary tax returns and other documentation with respect to all such taxes and fees. The Holder, the Purchaser and the Parent shall cooperate in good faith to minimize, to the fullest extent possible under such Laws, the amount of any such transfer tax payable in connection therewith.

(b) Allocation of the Purchase Price . Within sixty (60) days after the Closing Date, the Purchaser and the Holder shall confer and agree as to an allocation of the Purchase Price among the Transferred Assets in accordance with Section 1060 of the Code and the Treasury regulations thereunder (and any similar provision of state, local or foreign Law, as appropriate) (the “ Purchase Price Allocation ”). The Purchaser, the Parent and the Holder and their respective Affiliates shall report, act and file tax returns (including IRS Form 8594) in all respects and for all purposes consistent with the Purchase Price Allocation, and the Purchaser, the Parent and the Holder shall not take any position (whether in audits, tax returns or otherwise) that is inconsistent with the Purchase Price Allocation as finally determined pursuant to this Section 7.1 ( b ) unless required to do so by applicable Law

(c) Bulk Transfer Laws . The Holder, the Purchase and the Parent waive compliance with all applicable bulk sale, transfer, and similar Laws.

7.2 Confidential Information . The Holder hereby covenants and agrees that, from and after the Closing Date, the Holder and its Affiliates shall keep confidential and not disclose to any other Person any confidential information that is proprietary in nature regarding the Business, the Company, the Purchaser or the Parent and existing as of the Closing Date, provided that (a) the Holder may disclose on a confidential basis certain summary financial information relating to the Transactions to any professional advisor, and (b) the Holder may disclose information otherwise necessary in order to enforce the terms of this Agreement or defend against any claim made under this Agreement. The obligation of the Holder and its Affiliates under this Section 7.2 shall not apply to information which: (i) is or becomes publicly known without breach of the commitment provided for in this Section 7.2; (ii) is available from a third-party not under an obligation to keep such information confidential; or (iii) is required to be disclosed by Law, provided, however, that in any such case under this clause (iii), the Holder shall notify the Purchaser as early as reasonably

practicable prior to disclosure to allow the Purchaser to take appropriate measures to preserve the confidentiality of such information.

7.3 Injunctive Relief . The Holder acknowledges that any breach or threatened breach of the provisions of Section 7.2 of this Agreement will cause irreparable injury to the Business, the Purchaser, the Parent and/or the respective Subsidiaries and Affiliates of the Purchaser and the Parent for which an adequate monetary remedy does not exist. Accordingly, in the event of any such breach or threatened breach, the Purchaser, the Parent and/or their respective Subsidiaries and Affiliates shall be entitled, in addition to the exercise of other remedies, to seek and (subject to court approval) obtain injunctive and other equitable relief, restraining the Holder and/or its Affiliates from committing such breach or threatened breach. In addition, the prevailing party in the final, non-appealable determination of any Action to enforce any rights (other than the right to obtain injunctive relief) under any provision of such sections shall be entitled to recover all reasonable, out-of-pocket attorneys’ fees and costs incurred by such prevailing party in connection with such action. The rights provided under this Section 7.3 shall be in addition to, and not in lieu of, any other rights and remedies available to the Purchaser, the Parent and/or their respective Subsidiaries and Affiliates.

7.4 Consents . Nothing in this Agreement shall be construed as an attempt to assign any contract, agreement, License, guaranty, warranty, franchise or claim included in the Transferred Assets which is by its terms or by Law nonassignable without the consent of the other party or parties thereto, unless such consent shall have been given, or as to which all the remedies for the enforcement thereof enjoyed by the Company and/or the Holder would, as a matter of law, pass to the Purchaser as an incident of the assignments provided for by this Agreement. In order, however, to provide the Purchaser the full realization and value of every contract, guaranty, warranty, franchise and claim of the character described in the immediately preceding sentence, the Holder agrees that after the Closing, it will, at the request and under the direction of the Purchaser, in the name of the Holder or otherwise as the Purchaser shall specify, take commercially reasonable actions (a) to assure that the rights of the Holder and/or the Company under such contracts, guaranties, warranties, franchises and claims shall be preserved for the benefit of the Purchaser and (b) to facilitate receipt of the consideration to be received by the Holder and/or the Company in and under every such contract, agreement, guaranty, warranty, franchise or claim, which consideration shall be held for the benefit of, and shall be delivered to, the Purchaser.

7.5 Collection of Assets; Accounts Receivable Payment . At and after the Closing, the Purchaser shall have the right and authority to collect all Accounts Receivable and other items transferred and assigned to it by the Holder hereunder and to endorse with the name of the Holder any checks received on account of such Accounts Receivable or other items and the Holder agrees that it will promptly transfer or deliver to the Purchaser from time to time any cash or other property that the Holder may receive with respect to any claims, contracts, licenses, leases, commitments, sale orders, purchaser orders, receivables of any character or any other items included in the Transferred Assets. If any party hereto (or any Affiliate thereof) at any time receives any funds from any third party that are properly payable to another party hereto (including any payments with respect to the

Accounts Receivable), the party hereto receiving such funds shall promptly remit such funds to the party hereto entitled to such funds.

7.6 Use of Marks . The Holder agrees that, as of the Closing Date, the Holder shall promptly cease to use, and not permit any of its Affiliates or authorize any other Person to use, in any manner (including on the Internet, or as a company name or d/b/a in any sales literature, sales material or in connection with any products or services or otherwise) all Marks included in the Transferred Assets and/or any Mark similar thereto or derived therefrom.

7.7 Grant of Put Right .

(a) Subject to the terms in this Section 7.7, the Parent hereby irrevocably grants and issues to the Holder the right and option (the “ Put Right ”), exercisable by the Holder in its sole and absolute discretion (but which such exercise shall be irrevocable once exercised subject to the terms of this Section 7.7 ) by providing written notice to the Parent not later than October 21, 2016 (the “Put Notice ”), to cause and irrevocably require the Parent to purchase from the Holder, and the Holder to sell to the Parent, all (but not less than all) of the Consideration Shares on November 1, 2016 for an aggregate purchase price equal to $1,450,575.12 and otherwise in accordance with the terms of the Put Purchase Agreement (as defined below); provided, however, that the Holder shall not have the right to exercise its Put Right or enforce its rights under this Section 7.7 in the event of the consummation of the first underwritten public offering of the shares of the Parent or its Affiliate under the Securities Act or the laws of the jurisdiction of the related exchange. In the event that the Holder fails to deliver the Put Notice on or prior to October 21, 2016, the Holder shall be deemed to have irrevocably waived its right to exercise the Put Right.

(b) Following delivery of a Put Notice by the Holder to the Parent, the Holder and the Parent shall negotiate in good faith to agree on a purchase agreement reasonably satisfactory to such parties, which purchase agreement shall include customary provisions regarding the sale of equity from one party to another, including representations and warranties regarding ownership, authority and conflict (a “ Put Purchase Agreement ”). Notwithstanding anything in this Section 7.7 to the contrary, upon execution and delivery of the Put Purchase Agreement, the terms of the Put Purchase Agreement shall supersede the terms of this Section 7.7 and in the event of any conflict between the terms of this Section 7.7 and the Put Purchase Agreement, the Put Purchase Agreement shall control, provided that the Parent and the Holder will remain obligated to the terms.

7.8 Registration Rights . The Holder and the Parent acknowledge and agree that the provisions set forth in Sections 2.2, 2.3 ( b } , 2.4 — 2.8 and 2.11 — 2.13 (and the related definitions) of that certain Investors’ Rights Agreement, dated as of August 28, 2015, by and between the Parent and CPH TU, LP (the “ Investors’ Rights Agreement ”), are hereby incorporated by reference as if set forth in their entirety herein as if the Holder hereunder were a “Holder” with respect to such sections under the Investors’ Rights Agreement.

7.9 Further Assurances . At any time and from time to time after the Closing Date, the parties hereto shall (a) furnish upon reasonable request to each other such information, documents, instruments of transfer or assignment, files and books and records, (b) promptly execute,

acknowledge, and deliver any such documents, instruments of transfer or assignment, files and books and records, and (c) do all such further acts and things, as such other party may reasonably request for the purpose of carrying out the intent of this Agreement and the documents referred to herein. The Holder shall use its commercially reasonable efforts to avoid the entry of, or have vacated or terminated, any injunction, decree, Order, or judgment that would restrain, prevent, or delay the consummation of the Transactions, including defending through litigation on the merits any claim asserted by the Company or any third party relating to the Disposition or the Acquisition.

8. Survival of Representations and Warranties and Other Obligations; Indemnification .

8.1 Survival of Representations and Warranties and Other Obligations . Except as otherwise set forth in this Section 8.1, (a) all of the representations and warranties of the Holder, the Purchaser and the Parent contained in this Agreement or any other agreement, schedule or certificate delivered by the Holder, the Purchaser or the Parent pursuant to this Agreement, (b) the obligations of the Holder to the Purchaser Indemnified Parties under Section 8.2 ( a )( i ) - ( iv ) , and (c) the obligations of the Purchaser and the Parent to the Holder Indemnified Parties under Section 8.2 ( b ), shall survive for twenty-four (24) months after the Closing Date. If a party hereto determines that there has been a breach by any other party hereto of any such representation or warranty or other obligation of the Holder, the Purchaser or the Parent and notifies the breaching party in writing prior to the expiration of the survival period applicable to such representation and warranty or other obligation (which notice shall identify the nature of such claim with reasonable specificity and such party’s reasonable estimate of the value of such claim), such representation or warranty or other obligation and liability therefor shall survive, but only with respect to the specified breach or other obligation which is specified in such notice, until such breach has been resolved, but no party shall have any liability after such twenty-four (24) month period for any alleged breaches of representations and warranties or other obligation not specifically specified in a writing delivered within such twenty-four (24) month period. Notwithstanding any term in this Section 8.1 , (a) claims related to any intentional misrepresentation or fraud by the Holder, the Purchaser or the Parent in connection with this Agreement and the Transactions shall survive until the date that is sixty (60) days after the expiration of the respective applicable statute of limitations for such item, (b) the obligations of the Holder to the Purchaser Indemnified Parties with respect to Intellectual Property Damages shall survive for twelve (12) months after the Closing Date, (c) the obligations of the Holder to the Purchaser Indemnified Parties with respect to Lost Profit Damages shall survive for six (6) months after the Closing Date, (d) the representations and warranties contained in Sections 3.2 ( Organization and Standing ), 3.3 ( Authority for Agreement ), 3.9 ( Brokers or Agents ), 3.11 — 3.18 ( Purchase Entirely for Own Account: Disclosure of Information; Restricted Securities; No Public Market; Accredited Investor: No General Solicitation; Risks; Information ) 4.1 ( Organization and Authority ) and 4.2 ( Brokers or Agents ) shall survive indefinitely and (e) the obligations of the Holder to the Purchaser Indemnified Parties with respect to Stroock Damages and the Tax Damages shall survive for five (5) years.

8.2 Indemnification .

(a) Indemnification by the Holder . Subject to the limitations set forth in this Section 8, from and at all times after the Closing Date, the Holder shall indemnify the Purchaser, its Affiliates, and their directors, officers, managers, shareholders, members, partners, employees, agents, representatives, successors and permitted assigns (the “ Purchaser Indemnified Parties ”) and save and hold each of them harmless from and against and pay on behalf of or reimburse the Purchaser Indemnified Parties as and when incurred for any and all liabilities, obligations, demands, claims, actions, suits, proceedings, investigations, causes of action, assessments, judgments, losses, costs, damages, deficiencies, taxes, fines or expenses (whether or not arising out of third party claims), including, without limitation, interest, penalties, reasonable attorneys’ fees and all reasonable amounts paid in investigation, defense or settlement of any of the foregoing (collectively, “ Damages ”), which any Purchaser Indemnified Party may suffer or incur to the extent resulting from or arising out of:

(i) any misrepresentation, breach or inaccuracy of any representation or warranty of the Holder under Section 3 of this Agreement or in any agreement, schedule or certificate delivered or to be delivered by or on behalf of the Holder to the Purchaser or the Parent pursuant thereto;

(ii) any nonfulfillment, breach or violation of any covenant or agreement on the part of the Holder under this Agreement;

(iii) the inability of the Purchaser to lawfully conduct the Q Inside Micro Business;

(iv) any Action by or on behalf of the Company, the Company’s subsidiaries or any holders of equity or debt of the Company or any of the Company’s subsidiaries with respect to (“ Company Actions” ) (A) the Disposition. (B) the Acquisition, (C) the Transactions, this Agreement, any other Transaction Document or agreement contemplated hereby and/or the Transactions or otherwise in connection with the sale of the Transferred Assets by the Holder to the Purchaser;

(v) any infringement or other violation of Intellectual Property rights, or requirement that a Purchaser Indemnified Party make a material payment to a third party holding Intellectual Property, in connection with the conduct of the Q Inside Micro Business by a Purchaser Indemnified Party (the “ Intellectual Property Damages ”);

(vi) any liability or obligation with respect to the Stroock Claim (the “ Stroock Damages ”);

(vii) any liability or obligation with respect to any claims by a Government Authority with respect U.S. Federal income Taxes owed by or on behalf of the Company, the Company’s Affiliates, the Business, the Holder or the Holder’s Affiliates (the “ Tar Damages ”); and

(viii) lost profits or royalties regarding sales of products covered by the Q Inside Micro Business to parties other than the Purchaser and its subsidiaries and Affiliates as a result of prior grants by or on behalf of the Company or its Subsidiaries of licenses or other rights to such third parties regarding the development, production, sale or licensing of products covered by the Q Inside Micro Business (the “ Lost Profit Damages ”).

(b) Indemnification by the Purchaser and the Parent with respect to the Holder . Subject to the limitations set forth in this Section 3, from and at all times after the date of this Agreement, the Purchaser and the Parent shall, jointly and severally, indemnify the Holder and its managers, officers, members, employees, agents, representatives, successors and permitted assigns (the “ Holder Indemnified Parties ”) and save and hold each of them harmless from and against and pay on behalf of or reimburse the Holder Indemnified Parties as and when incurred for any and all Damages which any Holder Indemnified Party may suffer or incur to the extent resulting from or arising out of:

(i) any misrepresentation, breach or inaccuracy of any representation or warranty of the Purchaser or the Parent under this Agreement or in any agreement, schedule or certificate delivered or to be delivered by or on behalf of the Purchaser or the Parent to the Holder pursuant to this Agreement; and

(ii) any nonfulfillment, breach or violation of any covenant or agreement on the part of the Purchaser or the Parent under this Agreement.

(i) Holder . The maximum aggregate liability of the Holder to the Purchaser Indemnified Parties under this Agreement shall be One Million Dollars ($1,000,000.00); provided, however, that the maximum aggregate liability of the Holder to the Purchaser Indemnified Parties regarding Lost Profit Damages shall be Two Hundred Fifty Thousand Dollars ($250,000).

(ii) Purchaser and Parent . The maximum aggregate liability of the Purchaser and the Parent to the Holder Indemnified Parties under this Agreement shall be One Million Dollars ($1,000,000.00).

(iii) For the avoidance of doubt, this Section 8 shall not apply to any breach or default under any of the other agreements among the parties hereto.

(d) Limitations on Lost Profit Damages . Notwithstanding anything to the contrary contained herein, the Purchaser Indemnified Parties shall not be entitled to indemnification from the Holder for Exclusive Property Damages with respect to any Person that, to the actual knowledge of Juan Jose Chacon Quires, Nicholas Lewin, Rudy Mazzocchi or Luis Manuel Gutierrez on the date hereof, had any contractual rights that would result in such Lost Profit Damages.

(e) Right to Indemnification . The waiver of any condition based on the accuracy of any warranty or ^. representation, or on the performance of or compliance with any covenant or agreements, will not affect the right to indemnification or any other remedy based on such warranties, representations, covenants and agreements.

8.3 Tax Consequences . Any indemnity payment made under Section 8 with respect to a breach by the Holder with respect to the Purchaser or the Purchaser with respect to the Holder shall be deemed to be an adjustment in the Purchase Price, unless a contrary treatment is required under applicable Law.

8.4 Guaranty on behalf of Holder . By joining in this Agreement, Magna Holdings LLC, a Delaware limited liability company (“ Guarantor ”), guarantees to the Purchaser Indemnified Parties the full and prompt payment and performance (not just collection) by the Holder of all of the Holder’s covenants and obligations under this Agreement and any ancillary agreements, and further agrees to be bound by the obligations pursuant to Section 7 as if Guarantor were the Holder. If Guarantor is obligated under Section 8.2 or the Holder does not perform a covenant or obligation under this Agreement or any ancillary agreement, the Guarantor shall promptly perform the covenant or obligation. This guaranty of Guarantor is an absolute, irrevocable, primary, continuing, unconditional, and unlimited guaranty of performance and payment subject to and within the limitations of this Agreement, and is not a guaranty of collection. This guaranty shall remain in full force and effect (and shall remain in effect notwithstanding any amendment to this Agreement) for Guarantor until all of the obligations of the Holder have been paid, observed, performed, or discharged in full.

8.5 Sole and Exclusive Remedy . The parties hereto agree and acknowledge that, except in the case of intentional misrepresentation, fraud or intentional or willful breach of this Agreement, the rights to indemnification provided for in Section 7.1 and this Section 8 shall be the sole and exclusive remedy (regardless of the theory or cause of action pled) for monetary damages of the Holder Indemnified Parties on the one hand, or the Purchaser Indemnified Parties, on the other hand, as the case may be, after the Closing for and with respect to any misrepresentation, breach or inaccuracy of any representation or warranty of a party hereto and for any nonfulfillment, breach or violation of any covenant or agreement contained in this Agreement by a party hereto, and each party to this Agreement hereby waives to the fullest extent permitted by law, any other rights or remedies that may arise under any applicable Law in connection therewith; provided, however, that nothing herein will limit in any way any party’s rights hereunder or otherwise, to specific performance, injunctive relief or other non-monetary equitable relief.

9. Terms Defined . As used herein, the following terms have the respective meanings set forth below or set forth in the referenced Section of this Agreement:

“ Accounts Receivable ” — means the accounts receivable, and any other accounts, notes and other receivables related to the Business, determined in accordance with GAAP, that make up the Transferred Assets.

“ Action ” — means suit, claim, action, arbitration, proceeding or investigation.

“ Affiliate ” — means, with respect to any specified Person, a Person that, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, such specified Person. For purposes of this definition, “control”, when used with respect to any specified Person, means the power to direct the management and policies of such Person, directly or indirectly, whether through ownership of voting securities, by contract, agreement or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

“ Business Day ” — means a day other than a Saturday, a Sunday or a day on which the national banks located in New York, New York are required by Law (other than a general banking moratorium or holiday for a period exceeding four (4) consecutive days) to be closed.

“ Holder’s Knowledge ” — and words or phrases of similar import means actual knowledge of Marc Manuel and Andrew Reggev.

“ Excluded Assets ” — means (a) the Holder’s rights in, to and under the Transaction Documents and (b) cash and cash equivalents not related to the Business, wherever located.

“ Excluded Liabilities ” — means all liabilities and obligations of the Company or the Holder or their respective Affiliates (or otherwise relating to the Company, the Holder, their respective Affiliates, the Business or the Transferred Assets), including all liabilities and obligations:

(a) in respect of any Action involving the Company, the Holder or related to the Business or any Transferred Asset arising on or prior to the Closing Date (whether asserted or commenced before or after the Closing Date);

(b) relating to the Excluded Assets;

(d) relating to a Company Action;

(e) relating to Liens on the Transferred Assets arising on or before the Closing Date;

(f) any amounts payable for fees or expenses incurred by the Holder in respect to this Agreement, any other Transaction Document or agreement contemplated hereby and/or the Transactions, the Disposition or the Acquisition;

(g) any liabilities or Actions pending against the Holder as of the Closing Date, whether or not set forth in the Disclosure Schedules hereto, or any Actions commenced after the Closing Date and arising out of, or relating to, any occurrence or event happening prior to the Closing Date; and

(h) any amounts payable by the Holder or any Affiliate of the Holder.

“ Governmental Authority ” — means any nation or government, any state, municipality or other political subdivision thereof and any entity, body, agency, commission or court, whether domestic, foreign or multinational, exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government and any executive official thereof.

“ GAAP ” — shall mean United States generally accepted accounting principles as in effect on the date or for the period with respect to which such principles are applied.

“ Intellectual Property ” — means all proprietary information (whether or not protectable by patent, copyright, trademark or trade secret rights) and intellectual property rights throughout the world, including, without limitation, all trade names, trademarks (including common-law trademarks), service marks, domain names, web addresses, websites, social media accounts, art work, packaging, plates, emblems, brands, logos, insignia, works of authorship, and copyrights, and their registrations, applications and renewals, and all goodwill associated therewith, and all of their content and data, all domestic and foreign patents and patent applications, all moral, common law and economic rights of authors and inventors, all technology, know-how, show-how, inventions, discoveries, trade secrets, processes, formulae, drawings, designs, schematics, specifications, algorithms, systems, forms, technical and business information, data, databases, computer programs and software, object and source code, product information and development work-in-progress and all documentary evidence of any of the foregoing, all licenses, sublicenses or like agreements for any of the foregoing, and all other intellectual property or proprietary rights.

“ Inventory ” — means and includes goods owned and held with respect to the Business for sale, lease or resale or furnished or to be furnished under contracts for services, and raw materials, goods’ in process, materials, component parts and supplies used or consumed, or held for use or consumption, in the Business (including all components, merchandise, raw materials, work in progress and finished goods), which are held at, or are in transit from or to, the locations at which the Business is conducted, or located at suppliers’ premises on consignment, in each case, which are used or held for use in the conduct of the Business, including any of the foregoing purchased subject to any conditional sales or title retention agreement in favor of any other Person, together with all rights against suppliers of such inventories.

“Law” — means any non-U.S. or U.S. federal, state or local law (including common law), statute, rule, regulation or Order.

“ Lien ” — means any mortgage, lien, option, encumbrance, assignment, restriction, pledge, claim, security interest, hypothecation, adverse claim, easement, encroachment, right of way, burden, title defect, title retention agreement, voting trust agreement, right of first refusal, preemptive right, put, call, restriction on transfer, charge or other encumbrance, restriction or limitation.

“ Marks ” — mean trademarks, service marks, certification marks, trade dress, logos, trade names, slogans, Internet domain names and corporate names, all registrations, applications and renewals for any of the foregoing, and all goodwill associated with the foregoing.

“ Order ” — means any order or decree, judgment, injunction, ruling or other order, whether temporary, preliminary or permanent, that is enacted, issued, promulgated, enforced or entered by any Governmental Authority of competent jurisdiction.

“ Permitted Liens ” — means (i) statutory Liens for current taxes or other governmental charges not yet due and payable or the amount or validity of which is being contested in good faith by appropriate proceedings by the Holder and for which adequate reserves have been taken; and (ii) statutory mechanics’, carriers’, workers’, repairers’ and similar statutory Liens arising or incurred in the ordinary course of business for amounts which are not delinquent.

“ Person ” — means an individual, partnership, corporation, limited liability company, trust, joint venture, unincorporated organization, or a government or agency or political subdivision thereof.

“ Property ” — means any interest in any kind of property or asset, whether real, personal or mixed, and whether tangible or intangible.

“ O Inside Micro Business ” — means the right, free and clear of any payment obligation or other Liens (other than Permitted Liens), to (a) develop and produce Q Inside Micro transponders, including improvements thereto, (b) sell, or license to third parties the right to sell, Q Inside Micro transponders, including improvements thereto, to third parties and to the Purchaser’s subsidiaries and Affiliates, and (c) transfer, license and assign the Intellectual Property underlying the Q Inside Micro transponders, including improvements thereto, to a third party necessary for such third party to conduct the Q Inside Micro Business, including taking the actions described in clauses (b) and (c) of this definition.

“ Stroock Claim ” — means any claims by or on behalf of Stroock & Lavan LLP or its successors or assigns with respect to amounts owed thereto by or on behalf of the Company, the Company’s Affiliates, the Business, the Holder or the Holder’s Affiliates

“ Subsidiary ” — means, with respect to any Person, any corporation, limited liability company, partnership, association or other business entity of which fifty percent (50%) or more of the total voting equity is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof. Unless otherwise expressly provided, all references herein to a “Subsidiary” shall mean a Subsidiary of the Company, the Holder, the Purchaser or the Parent, as the context may require.

“ Transaction Documents ” — means this Agreement and any agreement contemplated hereby.

“ Transactions ” — means the transactions contemplated by this Agreement or any other Transaction Document.

“ Transferred Assets ” — means the Holder’s rights, title and interest in, to and under all assets, rights and properties of relating to the Company or the Business (whether real, personal or mixed, tangible and intangible, and of every kind, character and description), which were, or will be, acquired by the Holder or any of its Affiliates pursuant to the Disposition and the Acquisition (other than the Excluded Assets), including the Holder’s rights in, to and under the following assets, rights and properties of relating to the Company or the Business, in each case to the extent existing as of the Closing Date:

(a) Inventory . All Inventory;

(b) Tangible Personal Property . In addition to the Inventory described in the definition hereof, all equipment, vehicles, furniture, fixtures, machines, hardware, networks, office materials and supplies, spare parts and other tangible personal property of every kind and description owned, leased or subleased as of the date of this Agreement by the Holder and used, or held for use, in the conduct of the Business at the locations at which the Business was conducted or at suppliers’ premises or customers’ premises on consignment, and any additions, improvements, replacements, and alterations thereto made on or prior to the Closing Date;

(c) Contracts . All written agreements, contracts, instruments, documents, leases, Licenses, assignments or other business or commercial arrangements (in each case, including any extension, renewal, amendment or other modification thereof) relating to the Business or otherwise;

(d) Proprietary Rights . All Intellectual Property related to the Business, and all goodwill associated therewith, together with all rights to collect income, royalties, damages, products, proceeds and payments due or payable with respect to the foregoing, including all claims against third parties for past, present or future infringements or misappropriations thereof or other conflicts therewith, and the right to sue and recover for past, present or future infringements or misappropriations of or other conflicts with any of the foregoing, the right to recover damages or lost profits in connection therewith, and all corresponding rights throughout the world (collectively, the “ Proprietary Rights ”);

(e) Files and Records . All files, data and other records of that relate to the Business or otherwise, including all lists and records pertaining to customers, suppliers, distributors, personnel and agents, all related books, records, accounts, canceled checks and payment records;

(f) Prepaid Items . Deposits and other similar assets related to or made in connection with any of the Transferred Assets as well as prepayments and all other prepaid expenses of the Business or otherwise;

(g) Accounts Receivable . All Accounts Receivable;

(h) Licenses . All licenses, permits, franchises, certificates, and other authorizations issued by any Governmental Authority issued to or held with respect to the Business, including all applications therefor and all renewals, extensions, or modifications thereof and additions thereto, together with unemployment compensation, worker’s compensation and other credits, reserves or deposits with applicable Governmental Authorities (collectively, the “ Licenses ) ;

(i) Communications . All transferable telephone exchange numbers, the right to receive and retain mail and other communications and collections, including the right to retain mail and communications from distributors, agents and all others, in each case relating to the Business;

(j) Warranties . All rights under or pursuant to all warranties, representations and guarantees made by suppliers, manufacturers and contractors in connection with new materials, components, inventories or products sold to or services provided with respect to the Business, or affecting the property, machinery or equipment used in the conduct of the Business or any Transferred Asset;

(k) Claims . All claims, deposits, prepayments, warranties, guaranties, refunds, causes of action, rights of recovery, rights of set-off and rights of recoupment of every kind and nature related to, or in connection with, the Business or any Transferred Asset;

(l) Certifications . All certifications, ratings, listings and similar rights or benefits obtained from any customer, product certification organization or Governmental Authority related to, or in connection with, the Business or the Transferred Assets;

(m) Name . The rights to the name “Q Inside” or any derivation therefrom.

(n) Other Assets . All other property owned by the Holder, or as to which the Holder has any right (irrespective of title), in each case, related to the Business, on the Closing Date, other than the Excluded Assets; and

(o) Goodwill . All of the Holder’s goodwill in, and going concern value of, the Business or otherwise associated with any of the foregoing.

10. Miscellaneous .

10.1 Entire Agreement . This Agreement and the other Transaction Documents, documents, agreements and instruments delivered pursuant hereto and thereto (together with the recitals, the schedules and exhibits hereto) embody the entire agreement and understanding between the parties hereto with respect to the subject matter hereof and supersede all prior agreements and understandings relating to such subject matter.

10.2 Fees and Expenses . Except as otherwise expressly provided in this Agreement, the Purchaser and the Parent, on the one hand, and the Holder, on the other hand, each will pay all of their own fees, costs and expenses (including fees, costs and expenses of legal

counsel, investment bankers, accountants, brokers or other representatives and consultants and appraisal fees, costs and expenses) in connection with the preparation and negotiation of this Agreement and the other Transaction Documents and the Transactions.

10.3 Amendments and Waivers . This Agreement and the other Transaction Documents shall not be assigned by operation of law or otherwise; provided, however, that the Purchaser and the Parent may assign their respective rights and obligations to, Holder may assign its rights to, any Subsidiary or Affiliates (unless to do so would restrict or delay the consummation of the Transactions), but no such assignment shall relieve any party of its obligations hereunder. Notwithstanding the foregoing, any party may waive on its behalf any term, condition or covenant intended for its benefit by written consent. No waivers of or exceptions to any term, condition or provision of this Agreement, in any one or more instances, shall be deemed to be, or construed as, a further or continuing waiver of any such term, condition or provision.

10.4 Successors and Assigns . The Holder may not assign any of its rights or delegate any of its obligations under this Agreement without the prior written consent of the Purchaser. The provisions of this Agreement shall be binding upon, and inure to the benefit of, the respective successors and permitted assigns of the parties hereto.

10.5 Notices . All notices, requests, consents, and other communications under this Agreement shall be in writing and shall be delivered by hand, overnight courier or given by electronic facsimile transmission (confirmed by delivery by nationwide overnight courier sent on the day of the. sending of such facsimile transmission), or mailed by first class, certified or registered mail, return receipt requested, postage prepaid:

If to the Holder, to:

Magna Equities I, LLCc/o Magna
40 Wall Street
New York, New York 10005
Email: Marc.Manuel@Mag.na
Attention: Marc Manuel

or at such other address as may be furnished in writing by the Holder to the Purchaser;

with a copy to:

Kelley Drye•& Warren LLP
Telephone: 212-808-7540
101 Park Avenue
New York, NY 10178
Attention: Michael Adelstein

If to the Purchaser, to:

JAMM Technologies, Inc.
c/o Establishment Labs S.A.
B15 Coyol Free Zone
Alajuela, 20113
Costa Rica
Attention: Chief Executive Officer

or at such other address as may be furnished in writing by the Purchaser to the Holder;

with a copy to:

McDermott Will & Emery, LLP
28 State Street
Boston, MA 02109
Facsimile: 617-321-4612
Email: bbunn@mwe.com
Attention: Brian M. Bunn

Except as otherwise provided in this Agreement, all notices and communications hereunder shall be deemed to have been duly given (a) when transmitted by electronic or facsimile transmission and confirmed, (b) when personally delivered or, (c) in the case of a mailed notice, five (5) days after the date deposited in the mails, postage prepaid, in each case given or addressed as aforesaid.

10.6 Counterparts . This Agreement may be executed in two or more counterparts, and by different parties hereto on separate counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by facsimile or electronic mail in PDF or similar format shall be effective as delivery of a mutually executed counterpart to this Agreement.

10.7 Headings; Gender . The headings of the sections, subsections and paragraphs of this Agreement have been added for convenience only and shall not be deemed to be a part of this Agreement. Wherever reference is made herein to the male, female or neuter genders, such reference shall be deemed to include any of the other genders, as the context may require.

10.8 Severability . Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable Law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable Law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement, and the parties hereto shall amend or otherwise modify this Agreement to replace any prohibited or invalid provision with an effective and valid provision that gives effect to the intent of the Parties to the maximum extent permitted by applicable Law.

10.9 Specific Performance . The parties hereto acknowledge and agree that any party hereto would be irreparably damaged if any of the provisions of this Agreement are not performed in accordance with their specific terms and that any breach of this Agreement by any party could not be adequately compensated in all cases by monetary damages alone. Accordingly, in addition to any other right or remedy to which any party may be entitled, at law or in equity, such party shall also be entitled to enforce any provision of this Agreement by a decree of specific performance and to temporary, preliminary, and permanent injunctive relief to prevent breaches or threatened breaches of any of the provisions of this Agreement, without posting any bond or other undertaking.

10.10 Third Party Beneficiaries . Except as otherwise expressly provided herein, nothing expressed or referred to in this Agreement will be construed to give any Person other than the parties to this Agreement, any legal or equitable right, remedy, or claim under or with respect to this Agreement or any provision of this Agreement.

10.11 Governing Law . This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, regardless of the laws that might otherwise govern under applicable principles of conflicts of law.

10.12 Dispute Resolution .

(a) The parties hereto agree, on behalf of themselves, the Holder Indemnified Parties and the Purchaser Indemnified Parties, that any legal Action based on or arising out of this Agreement or for recognition and enforcement of any judgment in respect thereof brought by a party hereto, a Holder Indemnified Party or a Purchaser Indemnified Party, or their respective successors or assigns (other than a dispute governed by Section 7.3 or Section 10.9 , which shall be available to all parties hereunder) (a “ Dispute ”} , shall first be submitted to mediation according to the Commercial Mediation Procedures of the American Arbitration Association (“AAA”) (see www.adr.org ). Such mediation shall be attended on behalf of each party for at least one (1) session by a senior executive of the Holder (on behalf of itself and the Holder Indemnified Parties) and a senior executive of the Purchaser (on behalf of itself, the Parent and the Purchaser Indemnified Parties) with authority to resolve the Dispute. Any period of limitations that would otherwise expire between the initiation of mediation and its conclusion shall be extended until twenty (20) days after the conclusion of the mediation.

(b) Any Dispute not resolved by mediation within forty-five (45) days of notice by one party to the other of the existence of a Dispute (unless the parties agree in writing to extend that period) shall be resolved by arbitration in accordance with the Commercial Arbitration Rules of the AAA (“ AAA Rules ” ; see www.adr.org, } and the Federal Arbitration Act, 9 U.S.C. § 1 et seq. The arbitration shall be conducted in New York, New York, by one arbitrator appointed in accordance with the AAA Rules.

(c) The arbitrator shall follow the ICDR Guidelines for Arbitrators Concerning Exchanges of Information in managing and ruling on requests for discovery. The arbitrator, by accepting appointment, undertakes to exert her or his best efforts to conduct the

process so as to issue an award within eight (8) months of her or his appointment, but failure to meet that timetable shall not affect the validity of the award.

(d) The arbitrator shall decide the Dispute in accordance with the substantive law of Delaware and shall not award any damages, fees, cost, expenses or any other amounts that the parties have agreed to exclude pursuant to this Agreement. The award of the arbitrator may be entered in any court of competent jurisdiction.

10.13 Publicity . Except as required by applicable Law, no publicity, release, disclosure or announcement of or concerning this Agreement or the Transactions shall be issued by the Holder or any of its Affiliates without the advance written consent of the Purchaser; provided, however, that the Holder and its Affiliates shall be permitted to make disclosures concerning this Agreement to their accountants, attorneys and financial advisors. In the event that the Holder or one of its Affiliates is required by applicable Law to make a release or announcement, the Holder shall, or shall cause its Affiliate to, provide the Purchaser with a reasonable opportunity to review such release or announcement before such release or announcement is made.

10.14 References .

(a) When a reference is made in this Agreement to a Section, subsection, Exhibit or Schedule, such reference shall be to a Section, subsection, Exhibit or Schedule of this Agreement unless otherwise indicated. The headings contained in this Agreement, in any schedules and in the table of contents to this Agreement, are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. All Exhibits and Schedules annexed hereto or referred to herein are hereby incorporated in and made part of this Agreement as if set forth in full herein. Any capitalized term used in any Exhibit or Schedule, including the Disclosure Schedules, and not otherwise defined shall have the meaning given to such term in this Agreement. Unless the context clearly requires otherwise, whenever the words “include”, “includes”, “including”, “such as” or terms of similar meaning are used in this agreement, they shall be deemed to be followed by the words “without limitation.” The words “hereof’, “herein”, “hereby” and “hereunder” and terms of similar meaning when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. The term “or” is not exclusive. The word “extent” in the phrase “to the extent” means the degree to which a subject or other thing extends, and such phrase shall not mean simply “if. The definitions contained in this Agreement are applicable to the singular as well as to the plural forms of such terms. Any agreement or instrument defined or referred to herein means such agreement or instrument as from time to time amended, modified or supplemented. References to a Person are also to its permitted successors and assigns. Pronouns of one gender shall include all genders. All accounting conventions shall be consistent with GAAP unless otherwise specified. The headings in this Agreement are for reference only, and shall not affect the interpretation of this Agreement. All references to “ Dollars ” or “ $ ” shall be to United States Dollars unless otherwise specified.

(b) The Exhibits and Schedules to this Agreement are a material part of this Agreement. The Purchaser and the Parent acknowledge and agree that (i) any information set forth in one Section of the Disclosure Schedule will be deemed to apply to each other Section or

subsection of this Agreement, so long as such disclosure is specifically cross referenced or in sufficient detail to enable a reasonable reader to identify its applicability to the relevant provision in this Agreement, (ii) notwithstanding anything in this Agreement to the contrary, the inclusion of an item in such schedule as an exception to a representation or warranty will not be deemed an admission that such item represents a material exception or material fact, event or circumstance, and (iii) the information and disclosures contained in the Disclosure Schedules are intended only to qualify and limit the representations, warranties and covenants of the Holder contained in the Agreement, and will not be deemed to expand in any way the scope or effect of any of such representations, warranties or covenants. Capitalized terms used in the Disclosure Schedule and not otherwise defined therein have the meanings given to them in this Agreement.

10.15 Construction . The language used in this Agreement shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction shall be applied against any Person. The information contained in this Agreement and in the Disclosure Schedules and Exhibits hereto is disclosed solely for purposes of this Agreement, and no information contained herein or therein shall be deemed to be an admission by any party hereto to any third party of any matter whatsoever (including, without limitation, any violation of Law or breach of contract).

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, the undersigned have hereunto set their hands under seal as of the day and year first above written.



PURCHASER :

JAMM TECHNOLOGIES, INC.

Signature:	/s/ Juan Jose Chacon
Name:	Juan Jose Chacon
Title:	President


PARENT:

Signature:	/s/Juan Jose Chacon
Name:	Juan Jose Chacon
Title:	CEO



HOLDER:

MAGNA EQUITIES I, LLC

Signature:	/s/ Marc Manuel
Name:	Marc Manuel
Title:	Managing Director


GUARANTOR (to the extent described in this Agreement)

MAGNA HOLDINGS LLC

Signature:	/s/ Joshua Sason
Name:	Joshua Sason
Title:	Managing Member

[Signature Page to Asset Purchase Agreement]

Exhibit 10.12

SUPPLY AGREEMENT

This Agreement is made as of July 14, 2009, by and between NuSil Technology LLC, a Delaware Corporation, located at 1050 Cindy Lane; Carpinteria, California, U.S.A. 93013 (hereinafter called “Seller”) and ESTABLISHMENT BIOTECH, located at Carretera a Pavas, Altos del Banco Lafise, San Josd, Costa Rica (hereinafter called “Buyer”).

RECITALS

A. Buyer desires to purchase certain silicone material system(s) for the manufacture of its products. The silicone material systems are identified more specifically in Exhibit A (hereinafter the Materials). Buyer agrees to purchase the Materials, and any other silicone material systems which may become part of and subject to the terms of this Agreement, exclusively from Seller for the term of this Agreement.

B. Seller is the developer, manufacturer and seller of silicone materials which Buyer uses as raw materials for the manufacture of its products. Seller agrees to sell to Buyer the silicone materials identified on Exhibit A hereto as raw materials for Buyer’s use in the manufacture of Buyer’s own products.

Other silicone material systems may be developed from time to time which may become incorporated herein and subject to this Agreement.

In consideration of these mutual agreements, the parties agree to the following terms:

1. Term of Agreement.

The terms of this Agreement will govern the purchases of Seller’s materials identified above and the purchase of such other materials which the parties may hereafter designate to become part of this agreement for a period of five (5) years from the effective date of this Agreement, This Agreement may be renewed for additional one-year terms upon mutual written agreement of the parties reached at least 60 days prior to the end of any term or renewal thereof. The price, minimum quantity for delivery, and time of delivery as set forth on Exhibit B hereto will apply, and may be re-negotiated in good faith, on or before the date of any agreement to renew this Agreement. Failure to reach agreement on any renewal of this Agreement and the terms thereof will result in the termination of this Agreement or any extension hereof.

Notwithstanding the foregoing, this Agreement may be terminated by either party by certified mail, return receipt requested, upon 60 days notice in the event of any material breach by the other party of any of the terms of this Agreement, unless the breaching party corrects such breach within said 60-day period.

2. Payment Terms.

Payment will be made in United States Dollars within 60 days from the date of the Seller’s invoice. In no event shall such invoices be dated earlier than the date of shipment. Upon failure by

the Buyer to make any payment in accordance with this Agreement, Seller reserves the right, at Seller’s option, to terminate this Agreement or to suspend further deliveries, or to pursue any other remedy available to it in equity or at law. if, upon any breach of Buyer to the payment terms herein stated, in the judgment of Seller, Buyer’s ability to make payments becomes impaired, Seller may refuse to make delivery, except for cash on delivery, and may demand immediate payment in full for all materials previously delivered in accordance with this Agreement.

3. Supply and Shipment.

Seller hereby agrees to supply and Buyer hereby agrees to purchase all of the Materials required by Buyer for its use in accordance with the terms hereof.

The Materials shall be manufactured pursuant to ISO 9001;2008, select sections of 1S013485:2003 and 21 CFR Part 820 Quality System Regulation, and all applicable laws and regulations, and shall comply with the specifications set forth on Exhibit A hereto.

Unless otherwise agreed to by both parties, materials shipped in accordance with this Agreement will be shipped FOB Carpinteria, California USA. The materials will be packaged in containers consistent with commercial practices for materials of this type, and will be accompanied by a certificate of analysis verifying that the Material complies with the specifications set forth in Exhibit A. Customs duties, and applicable taxes are the responsibility of the Buyer.

4. Purchase Orders.

Buyer shall provide Seller with firm purchase orders in writing, setting forth the desired delivery date, which shall be at least 60 days from the date of receipt of the purchase order, with any adjustments provided at least 60 days prior to the desired delivery date.

5. Confidential Information.

Buyer and Seller agree to treat as confidential, and not to divulge to any other person or entity, any information relating either to Buyer’s products or to the silicone materials produced by Seller, including the manufacturing processes, testing protocol, suppliers, and customer information of each party. Buyer and Seller have signed and entered into a Confidential Disclosure Agreement that governs the handling and control of all confidential and proprietary information between Buyer and Seller, which Confidential Disclosure Agreement is incorporated herein by reference. The obligations and rights set forth in the Confidential Disclosure Agreement shall survive this Supply Agreement and are independent and integrated without regard to this Supply Agreement.

Warranties.

Seller warrants only that the material delivered in accordance with this Agreement meets the specifications for material as set forth in Exhibit A hereto, or such other specifications as may be agreed upon between the parties in writing. No other warranties or representations have been made by Seller, and Seller specifically disclaims any other warranties or representations including those as to the safety or suitability of Seller’s material for any specific use.

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SELLER NEITHER MAKES NOR INTENDS, NOR DOES IT AUTHORIZE ANY AGENT OR REPRESENTATIVE TO MAKE, ANY OTHER WARRANTIES, EXPRESS OR IMPLIED, AND IT EXPRESSLY EXCLUDES AND DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

Seller does not by this Agreement intend or authorize Buyer to act as Seller’s agent for any purpose and Buyer’s relationship to Seller is strictly limited to that of a customer as set forth in this Agreement.

7. Claims.

Buyer’s receipt at Buyer’s destination of any material delivered hereunder shall be an unqualified acceptance of, and a waiver by Buyer of its right to make any claim with respect to such material unless Buyer gives Seller written notice of claim within 30 days after Buyer’s receipt at Buyer’s destination. In the case of a claim for non-delivery, such claims shall be deemed waived unless Seller receives written notice of the claim within 30 days of the date set for the Buyer’s receipt.

Buyer assumes all risks and liabilities resulting from the delivery or use of any material supplied by Seller hereunder or the incorporation of such materials in any of Buyer’s products or processes.

Claims for shortages of less than one-half of one percent (0.5%) of the gross weight of any individual bulk shipment will not be allowed. Seller’s weights taken at the shipping point shall govern, unless proven to be in error.

Seller will notify the Buyer by telephone or facsimile without delay of any occurrence that will prevent the delivery of material to Buyer on or before the originally scheduled date.

Buyer’s exclusive remedy and Seller’s exclusive liability for any and all claims as to the Material delivered hereunder, or for delayed delivery or non-delivery of the Material, including liability based on existing or alleged Breach of Warranty or Breach of Contract, shall be limited to the price of the Material. If the Material fails to meet the established specifications as set forth in Exhibit A hereto, or as otherwise agreed in writing between the parties hereto and be therefore unusable by Buyer for any purpose, Buyer shall return the Material to the Seller at Seller’s expense, within 30 days from the date of Buyer’s receipt of such Material. Seller shall replace any non-conforming Material at Seller’s expense.

8. Contingencies.

a. Neither Buyer nor Seller shall be liable for its failure to perform hereunder (except for its obligation to make payments for material already received by Buyer), if performance is made impracticable due to any occurrence beyond its reasonable control including Acts of God; earthquakes; fires; floods; wars; sabotage; accidents; power outages; labor disputes; government laws, ordinances, rules, regulations, standards or decrees, whether valid or invalid (including but not

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limited to priorities, requisitions, allocations, and price adjustment restrictions); inability to obtain raw material, equipment or transportation; and any other such occurrence.

b. Upon the occurrence of any contingency as set forth in the preceding paragraph, either party may suspend or terminate this Agreement upon written notice to the other party of such occurrence, setting forth the full particulars in connection therewith. The party affected by such contingency shall have the right to omit during the period of such occurrence all or any portion of the quantity deliverable hereunder. It; due to any such occurrence, Seller is unable to supply the total demands for the material supplied hereunder, Seller shall allocate its available supply among its customers in a fair and equitable manner. In no event shall either party be required to settle strikes, lockouts, or other labor difficulties contrary to its best interest, nor shall Seller be obligated to purchase material from others in order to enable it to deliver material to Buyer.

9. Termination and Default.

Subject to the provisions of paragraph 8 above, if either party hereto shall fail to perform or fulfill, at any time and in the manner herein provided, any obligation or condition required to be performed or fulfilled by such party hereunder, and if such party fails to remedy any such failure within 60 days after written notice thereof from the non-defaulting party, or fails to commence reasonable efforts to remedy a curable default within such 60-day period and fails to continue in good faith to attempt to remedy such curable default (where default cannot reasonably be remedied within 60 days), the non-defaulting party shall have the right to terminate this Agreement by giving written notice of the termination to the defaulting party at any time after said 60-day period. Such termination shall not be deemed an election, but shall be in addition to any other rights and remedies available to the non-defaulting party.

In the event that the parties to the Agreement are unable to reach an accord relating to quantity, time of delivery, price or conditions of sale, either party may give 60 days’ advance notice of termination of the present Agreement.

Upon termination of this Agreement, the Buyer may purchase from another manufacturer/seller the material needed for its production contemplated by this Agreement.

If at any moment, for whatever reason, the Seller incurs in a delay of 15 days or more in the shipment of any order, or if in the judgment of Buyer, Seller’s ability to supply the Materials, in the date or in the quantity required by Buyer, becomes impaired, Buyer at is sole discretion shall be able to buy the materials from another provider to complement or substitute the Seller’s provision, as the need may arise.

10. Non-waiver.

Failure of either party to exercise or enforce any right under this Agreement upon one or more occasions shall not constitute a waiver of the right to exercise or enforce the same or any other right on another occasion.

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11. Notices.

Unless otherwise expressly provided herein, any notice, request, report, statement or other communication to be given hereunder shall be in writing and addressed to Establishment Biotech, Carretera a Pavas, Altos del Banco Lafise, San Jose, Costa Rica and to NuSil Technology LLC, attn. President, 1050 Cindy Lane, Carpinteria, CA 93013, U.S.A. All such communications by either party pursuant to any of the terms of this Agreement which are forwarded by registered or certified mail, return receipt requested, shall be deemed to have been given upon the date of the mailing thereof as shown on the Post Office receipt, otherwise, such communications shall be deemed to have been given on the date of receipt thereof. Either party may at any time direct in writing in the manner herein provided, that all or particular communications or types of communications be delivered addressed to specific designees other than those named herein.

12. Governing Law and Arbitration

This Agreement shall be governed by the laws of the State of California without regard to its conflict of laws provisions. The parties have agreed that this Agreement and any disputes arising from it shall be conducted in the English language. Any translations to any other language shall be for convenience only.

Any controversy or claim arising out of or relating to this contract, or the breach thereof, shall be determined by arbitration administered by the International Centre for Dispute Resolution, of the American Arbitration Association, in accordance with its International Dispute Resolution Procedures, as modified by the 1CDR Online Protocol for Manufacturer/Supplier Disputes then in effect (International Dispute Resolution Procedures and the ICDR Online Protocol for Manufacturer/Supplier Disputes at http://www.icdr.org).

13 Agreement Severable

In the event that any portion if this Agreement or the application of this Agreement to any situation of material is found to be invalid or unenforceable, the remainder of this Agreement or its applicability to all other situations of materials shall remain in force and effect.

14. Miscellaneous

The terms and conditions hereof constitute the entire agreement between the parties hereto with respect to the subject matter hereof and supersede all previous communications, either oral or written, between the parties herein. There are no understandings, representations or warranties of any kind whatsoever, except as expressly set forth herein.

This Agreement shall be binding upon and inure to the benefit of the respective successors and assigns of each of the parties hereto. Any assignment or delegation hereof by either party, without the prior written consent of the other party, shall be void, except where such assignment or delegation is to a subsidiary or affiliate of Seller or is in connection with the sale of the business of

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Seller to which this Agreement relates, in which case this Agreement shall be assigned to any entity assumed by the transferee, subject to the approval of Seller.

No modification of this Agreement or waiver of the terms or conditions hereof shall be binding upon either party unless approved in writing by an authorized representative of each party, nor shall the terms and conditions of this Agreement be affected by the acknowledgment or acceptance of purchase orders, releases, or other forms containing additional or different terms or conditions.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written.



NuSil Technology, LLC		ESTABLISHMENT BIOTECH

by: Brian Nash		by: Juan Jose Chacon Quiros

Title: VP of Marketing and Sales		Title: Director

Date: October 6, 2009		Date: September 28, 2009

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EXHIBIT A

MATERIALS

[***]

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EXHIBIT B

[***]

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Exhibit 10.13

CONFIDENTIAL

EXECUTION COPY

8 SEPT 2016 FROM ELHI

San Francisco, CA

EXCLUSIVE DISTRIBUTION AGREEMENT

EXCLUSIVE DISTRIBUTION AGREEMENT (this “Agreement”) is made and entered into effective as of September 7th, 2016 (“Effective Date”), and is by and between Puregraft LLC, a Delaware Limited Liability Company having its primary office and place of business at 420 Stevens Avenue, Suite 220, Solana Beach, CA 92075, its parent company Bimini Technologies, LLC, and any affiliates and/or subsidiaries thereto (together, “Puregraft”), and Establishment Labs Holdings Inc., a company organized under the laws of the British Virgin Islands, having its primary office and place of business at Coyol Free Zone Building 15, Alajuela, Costa Rica (“Distributor”) (each a party and collectively the parties).

RECITALS:

WHEREAS, Puregraft desires to have Distributor develop a demand for, and to act as its exclusive third-party distributor for, the Products (as defined herein) within the Territory (as defined herein); and

WHEREAS, Distributor desires to be designated as the exclusive third-party distributor of Products in the Territory, and to maintain the expertise, staff, resources and other necessary investments to carry out the terms of this Agreement.

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants contained herein, Puregraft and Distributor hereby agree as follows:

1. Certain Definitions. As used in this Agreement, the terms set forth below shall have the following meanings:

1.1 “Products” shall mean Puregraft’s PuregraftTM 50 System, PuregraftTM 250 System and PuregraftTM 850 Systems, the Puregraft Vacuum Lid, and related instruments and accessories manufactured or supplied by Puregraft for the Markets (as defined below) on the date of this Agreement and as specifically described in Schedule 1.1 attached hereto and incorporated herein.

1.2 “Territory”/”Territories” shall mean all territories outside of the United States of America and Canada.

1.3 “Market(s)” shall mean The Cosmetic and Reconstructive Surgery Market (CRS Market) for autologous fat transplantation. The Market as defined herein shall not include the Hair Field of Use and the treatment of any unspecified diseases or injuries to the above-mentioned bodily structures or any other structures of the body, including muscle, bone, nerve or blood.

1.4 “Customers” shall mean physicians, hospitals, clinics, hospital groups, and other end users or potential end-users of the Products, as well as other sub-distributors to whom Distributor may sell Products.

2. Distributorship.

2.1 Appointment. Upon the terms and subject to the conditions contained herein, Puregraft hereby appoints Distributor as its exclusive third party distributor of Products in the Territory during the Term. Puregraft will convey promptly to Distributor the contact information and record of outstanding orders from all Puregraft customers in the Territory, and will communicate to all such past and current customers that future orders are to be placed with Distributor, and will refer to Distributor any orders, or other expressions of interest in purchase, of Products within the Territory.

2.2 Acceptance of Exclusive Appointment. Distributor hereby accepts appointment as Puregraft’s exclusive third-party distributor of Products in the Territory and agrees fully and faithfully to perform and discharge all of its duties, obligations and responsibilities, and to abide by the restrictions set forth in this Agreement. Distributor acknowledges that the Products are specifically designed and/or calibrated only for the Markets within which they are intended to be sold hereunder.

2.3 Independent Contractor. The relationship of Puregraft and Distributor established by this Agreement is that of independent contractors, and nothing contained in this Agreement shall be construed to give either party hereto any control over, or power or authority as agent, employee, partner, creditor, shareholder, or in any other capacity to represent, act for, bind or otherwise create or assume an obligation on behalf of the other for any purpose whatsoever.

2.4 Duties, Obligations and Restrictions of Distributor. Distributor agrees to use commercially reasonable efforts to develop the full sales potential of the Territory, including the following duties:

(a) Distributor shall exert its best efforts to introduce and diligently promote, sell and service the Products within the Territory. Distributor will, in good faith, consider for dissemination to its Customers all promotional materials supplied by Puregraft. Puregraft will provide Distributor with a number of non-sterile samples as determined by Puregraft in its sole discretion, free of charge for promotional activities.

(b) Puregraft shall provide to Distributor, at Puregraft’s own expense, training related to the use and maintenance of the Products, and customer service training related to Product ordering and fulfillment. Following such training by Puregraft, Distributor will be responsible for training Customers in the Territory in appropriate use and maintenance of the Products.

(c) Distributor will be responsible for all customer service activities within the Territory, including receipt and fulfillment of orders from, shipping to, and handling of

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Product returns from, Customers. All revenues in the Territory will be recorded by Distributor, and Distributor has the right to collect funds and report the corresponding revenue (to the extent appropriate under applicable accounting rules) to third parties.

(d) Distributor will direct any warranty related issues outside the scope of Distributor’s responsibilities to Puregraft.

(e) Distributor may organize, at its own expense; any dinners or symposia associated with medical education activities in connection with promotion of the Products. For clarity, such dinners or activities may be held outside the Territory, provided that invitees are solely Customers within the Territory. In the event Distributor organizes such activities, it shall be responsible for all associated expenses, including for example, room or booth rentals at promotional events, and printing costs of any new marketing communication materials.

(f) Distributor shall not (A) seek Customers or establish any branch or maintain any distribution depot for the Products in any country that is outside the Territory; or (B) sell the Products to any Customer in any country that is (i) outside the Territory or (ii) within the Territory if to the knowledge of the Distributor that Customer intends to resell the Products in any country that is outside the Territory. Puregraft will not (A) sell the Products to any Customer in any country that is (i) inside the Territory or (ii) outside the Territory if to the knowledge of Puregraft, that Customer intends to resell the Products in any country that is inside the Territory (excluding Cytori Therapeutics).

(g) Distributor shall refer to Puregraft for direct action any orders or inquiries for Products from Customers outside of the Territory or which involve nonstandard versions of the Products.

(h) Distributor will implement promotional and merchandising efforts for the Products. Distributor shall provide to Puregraft at least one (1) copy of all of Distributor’s advertising and sales promotion materials in which any Products are mentioned, and at least one (1) copy of any translations of any manuals or other materials provided to Distributor by Puregraft (collectively the “Documentation”). Distributor shall not use any such Documentation until Puregraft has approved such use in writing, which approval will be provided to Distributor not later than ten (10) business days following Distributor’s submission to Puregraft. Puregraft may reject and Distributor shall not make use of any such Documentation that Puregraft, in its sole discretion, deems undesirable.

(i) Distributor will comply with all applicable state and local laws and regulations, and will not knowingly assist or participate in any violation of laws or regulations applicable to Puregraft or Distributor, including export controls and similar regulations (such as the Export Administration Regulations of the U.S. Department of Commerce (the “EAR”), which may restrict or require licenses for the export of Products from the United States and their re-export from other countries.

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(j) Distributor shall make no false or misleading representations to customers or other persons with regard to the Products or Puregraft, and shall not make any representations with respect to the specifications, features or capabilities of the Products which are not consistent with those described in literature distributed by Puregraft.

(k) Distributor agrees to provide Puregraft end-user customer information for the Products on a quarterly basis. The customer list shall include name, address, total annual products purchased by customer, and annual revenue generated by customer. Distributor will comply with the minimum end user pricing floors defined in Schedule 1.3 during the Term.

(l) During the Term of this Agreement, neither ELHI nor any of its Affiliates will market, sell, or develop any competing form of adipose tissue processing product.

(m) Puregraft is entitled to visit all Customers and maintain a relationship with such customers, and reserves the right to sell Customers products in the Territory other than the Products sold by Distributor.

(n) During the term of this Agreement, Puregraft will continue to own all of the existing patents and other intellectual property that is necessary for the products listed on Schedule 1.1.

2.5 Non Exclusive Option. For a period of 1 year from the date this Agreement is fully executed, Distributor will be entitled to act as a non exclusive distributor of the Products in the United States and Canada but may only sell to new accounts and the pricing for the Product will comply with the pricing floors described in Schedule 2.3. For a period of one (1) year from the date of this Agreement, Distributor will have the option of becoming the exclusive distributor of the Products in the United States and Canada but only if it meets the requirements set forth on Schedule 2.2 and the following conditions are met during the one year period:

(a) Distributor hires and/or appoints a head of sales for North America not from Puregraft.

(b) Distributor hires or acquires ten (10) sales representatives in the United States not from Puregraft.

(c) Distributor acquires or exclusively distributes a US FDA Cleared or Approved plastic, cosmetic and or reconstructive medical device that is nota Puregraft Product.

(d) Initial Order. Distributor will deliver to the Company a written purchase order covering 25% ($693,750) of the Year 1 minimum order quantity as described in Schedule 2.2. Two hundred thousand dollars ($200,000) of this will be paid by Distributor within 30 days of execution of this Agreement which will be debited against $693,750.

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3. Purchases and Sales of Products.

3.1 Initial Order. Upon execution of this Agreement, Distributor will deliver to the Company a written purchase order covering 25% ($555,000) of the Year 1 minimum order quantity as described in Schedule 1.2. Two hundred thousand dollars ($200,000) of this will be paid by Distributor within 30 days of execution of this Agreement which will be debited against $555,000.

3.2 Forecasts/Commitment to Minimum Quarterly Purchase Requirements. Purchase orders will be placed by Distributor on a quarterly basis. Such orders will be at least of the quantity specified in the Minimum Quarterly Product Purchases according to Schedule 1.2. The Minimum Quarterly Product Purchase obligations and associated obligations to place purchase orders shall be suspended and of no effect for any period of time during which a Product has been withdrawn from the market or is the subject of a hold or recall or similar circumstance that prevents or significantly impairs the ability of Distributor to sell the Products.

3.3 Ordering Procedure. The following shall apply to all orders placed hereunder:

(a) Purchases and sales of the Products between Distributor and Puregraft under this Agreement shall be made by means of purchase orders submitted by Distributor to Puregraft, specifying, among other things, the number of units and unit price of each Product ordered under each purchase order, and the desired date and place of delivery. In the event of termination of this Agreement per Section 15, Distributor shall have the right to cancel any outstanding quantity remaining on any purchase order then in place with Puregraft. The terms and provisions of this Agreement shall govern and control each purchase order submitted by Distributor to Puregraft, and any additional or different terms or provisions contained in any such purchase order shall have no force and effect whatsoever.

(b) Puregraft will accept any order that is provided by Distributor in compliance with this Agreement. Puregraft reserves the right to reject or modify the delivery terms of any order without in any way affecting the obligations of either party under this Agreement; provided, that Puregraft gives Distributor, in a timely fashion and in writing, a reasonable justification for the rejection or modification of any order, and an estimated delivery date for any orders where the requested delivery date was changed. For clarity, so long as Distributor places an order for such amounts as required by Section 3.2, Distributor will have met its obligations under Section 3.2, regardless of whether Puregraft subsequently rejects or modifies such order.

(c) Puregraft reserves the right to reject or modify the delivery terms of any order without in any way affecting the obligations of either party under this Agreement; provided, that Puregraft gives Distributor, in a timely fashion and in writing, a reasonable justification for the rejection of any order, and an estimated delivery date for any orders where the requested delivery date was changed.

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3.4 Product Packaging. The parties will collaborate to develop packaging for the Territory, which may, at Distributor’s option, include brand marks and logos of Distributor. Puregraft agrees to cause the Products to be packed pursuant to its standard export procedure (and applicable specifications, laws, and regulations) and to deliver the Products to Distributor in accordance with the terms of each purchase order as accepted by Puregraft (to the extent consistent with this Agreement). The above notwithstanding, it is the obligation of the Distributor to ensure compliance with local regulations on this and other requirements in the Territory as set forth in Section 6.

3.5 Title, Acceptance, Risk of Loss and Returns. Title to Products and all risk of loss shall pass from Puregraft to Distributor at the time and place of Puregraft’s delivery of Products to Distributor, FCA (Incoterms 2010) Shipping Point. Distributor shall be solely responsible for insuring Products after delivery to the Distributor, FCA Shipping Point. Products may be returned only as provided by any specific warranties of Puregraft pursuant to this Agreement.

3.6 Foreign Corrupt Practices Act. Distributor and Puregraft each represent and warrant that it will comply with all laws applicable in the Territory relating to the conduct of business practices, including those that may prohibit gratuities, inducements, or certain other payments; including, payments of money or anything of value offered, promised or paid, directly or indirectly, to any government official, or public or political officer, to induce such official to use their influence with a government or instrumentality to obtain an improper business advantage for the Puregraft or Distributor in relation to this Agreement. Distributor and Puregraft acknowledge that each may be subject to certain United States laws, including the Foreign Corrupt Practices Act of 1977 and any of its amendments, which may apply to activities carried out on Puregraft’s or Distributor’s behalf outside the United States of America. Distributor and Puregraft each agrees neither to take nor omit to take any action if such act or omission might cause Puregraft or Distributor to be in violation of any such laws. Upon written notice from Puregraft or Distributor, as the case may be, the other party shall provide such information as Puregraft or Distributor may reasonably consider necessary to verify compliance by Puregraft or Distributor with the provisions of this Section.

3.7 During the term of this Agreement, all future products sold by Puregraft, LLC (which, for clarity, excludes the Bimini parent company, Kerastem, LLC, and the parent company’s other affiliates) to other companies (excluding Cytori Therapeutics) within the Field shall be sold to Distributor at prices similar to those offered to such others after taking into account volumes and creditworthiness.

4. Product Prices. Distributor’s purchase price for the Products are set forth on Schedule 1.1 (Products and Price List), as issued and changed by Puregraft from time to time on at least thirty (30) days notice.

5. Payment for Products.

5.1 Payment Terms. All payments by Distributor under this Agreement shall be made free of any exchange or collection charges and of any taxes imposed under the laws of

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any country other than the United States of America, and shall be due and payable 30 days after delivery of each shipment to Distributor as provided in Section 3.5 above. Distributor shall pay all collection charges and expenses, including, but not limited to, attorneys’ fees, which are incurred by Puregraft in connection with Puregraft’s collection of any amounts under or relating to this Agreement.

Distributor agrees to provide a credit card on file or letter of credit. Subsequent orders will not be processed until open and past-due accounts payable balance is received.

5.2 Invoices. Puregraft shall invoice Distributor for the purchase price of the Products upon receipt of an Order.

5.3 Late Payment. If Distributor fails to pay to Puregraft any amount when due, Distributor agrees to pay interest on the overdue balance at the rate of eight and one-half (8.5%) per annum or, if such rate exceeds the maximum rate permitted by law, Distributor shall pay interest on such overdue balance at the maximum rate permitted by law. Payments received from Distributor when any overdue balance exists shall be applied first against accrued interest.

6. Regulatory Matters. Puregraft will use commercially reasonable efforts to maintain any regulatory approvals of any Products in the Territory that exist as of the date of this Agreement. Puregraft will allow Distributor to access and to reproduce, for purposes of regulatory filings and correspondence in the Territory, any regulatory filings, supportive data, and regulatory correspondence («Regulatory Materials») developed or otherwise possessed by Puregraft, and will promptly disclose any new Regulatory Materials to Distributor. Puregraft shall be responsible for maintaining any regulatory approvals for sale currently applicable in the Territory, and will cooperate with any information or other requests that regulatory authorities may convey, either to Distributor or Puregraft. For countries in which Puregraft is unable or unwilling to obtain approval, Distributor may attempt to obtain approval at distributors sole expense, and Puregraft will cooperate with such Distributor efforts.

Puregraft agrees that its factory, facilities, operations and quality systems used to make Products may be inspected and/or audited by Distributor at reasonable intervals, provided that Distributor gives at least thirty (30) days’ prior written notice to Puregraft of its desire to undertake such an inspection and/or audit. Puregraft will also provide Distributor with notice of any third-party quality and/or manufacturing audits to be performed by regulatory authorities and notified bodies.

Distributor shall be responsible for complying with any and all applicable statutory, administrative or regulatory requirements of the Territory for product labeling and packaging, product documentation such as traceability, samples, sales literature and records, and documentation for recalls, including but not limited to product serial numbers for each product sold identifiable by account and date of sale, which documentation shall be maintained for durations as required by regulations in each country in the Territory by the Distributor, notwithstanding termination or expiration of this Agreement. Distributor shall also assist Puregraft in the implementation of any Product recalls at Puregraft’s expense.

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7. Confidential Information.

7.1 Definition. Each of the parties hereto recognizes that the relationship created by this Agreement may involve access by Distributor and Puregraft to information of substantial value to the other party, including, but not limited to, designs, drawings, plans, devices, trade secrets, clinical data, applications, formulae, know-how, methods, techniques, and processes (whether related to Puregraft’s PuregraftTM PURE System, or otherwise), as well as financial, business, marketing and product development information, and customer lists relating to the Products (collectively, “Confidential Information”), provided that Confidential Information shall not include information, only in so far as such information is: (a) in the public domain or which subsequently falls into the public domain, (b) specifically intended by Puregraft for disclosure to Customers of Distributor, (c) information which the non-disclosing party can prove was already known to it prior to the date of this Agreement, or (d) disclosed to the non-disclosing party in good faith by a third party having a legal right to do so.

7.2 Non-Disclosure. Each of the parties hereto acknowledges and agrees that the Disclosing party owns all right, title and interest in and to such party’s Confidential Information. Each of the parties hereto further agrees that it shall (a) maintain the secrecy and confidentiality of all Confidential Information which comes to its attention, (b) take all necessary precautions to prevent any disclosure of Confidential Information by any person within the control of the Distributor having access to said Confidential Information, and (c) during the Term of this Agreement and for so long as Confidential Information does not enter into the public domain through an act or omission of Puregraft, neither publish, disclose nor disseminate any part of such Confidential Information in any manner, or use the same, without the prior written consent of the disclosing party. Each party recognizes and agrees that the non-disclosing party may disclose Confidential Information of the Disclosing party to the extent (and only to the degree) that it is required to do so by applicable laws and governmental regulations. Disclosing party shall be notified at the earliest opportunity prior to any disclosure required by law or governmental authority.

7.3 Injunctive Relief. Each of the parties hereto understands and agrees that the Confidential Information has special value, the loss of which cannot be reasonably or adequately compensated in damages or in an action at law, and therefore, in the event of any breach or violation of the provisions of this Section 7 by Puregraft or Distributor, the non-breaching party shall be entitled to equitable relief by way of injunction without the necessity of proving actual damages, which relief shall be in addition to, and not in limitation of, any other relief or rights to which such party may be entitled.

7.4 Survival. The terms and provisions of this Section 7 shall survive any termination or expiration of this Agreement.

8. Warranty. The sole warranty given by Puregraft regarding any Product shall be that written limited warranty provided in Schedule 3.1, as it may from time to time be amended by mutual written consent of Distributor and Puregraft (the “Warranty”). Distributor agrees to provide to its Customers within the Territory a written warranty for each particular Product on terms at least as favorable to Customers as that supplied by Puregraft for such Product.

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Excepting cases of gross negligence, or willful misconduct by Puregraft, in no event shall Puregraft’s total liability for any claim or action in connection with a Product exceed the purchase price of the Products out of which such claim or action arose.

EXCEPT AS EXPRESSLY SO WARRANTED, PUREGRAFT HEREBY DISCLAIMS ALL WARRANTIES, EXPRESS, STATUTORY AND IMPLIED, APPLICABLE TO THE PRODUCTS INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OF MERCHANTABILITY, DESIGN, AND/OR FITNESS FOR A PARTICULAR PURPOSE. THE WRITTEN LIMITED WARRANTY, IF ANY, APPLICABLE TO ANY PARTICULAR PRODUCT SHALL STATE THE FULL EXTENT OF PUREGRAFT’S LIABILITY, WHETHER DIRECT OR INDIRECT, SPECIAL OR CONSEQUENTIAL, RESULTING FROM ANY BREACH OF SUCH WARRANTY. PUREGRAFT FURTHER DISCLAIMS ALL EXPRESS, STATUTORY AND IMPLIED WARRANTIES APPLICABLE TO THE PRODUCTS WHICH ARE NOT MANUFACTURED BY PUREGRAFT, OR BY A LICENSEE OR SUBLICENSEE OF PUREGRAFT. THE ONLY WARRANTIES APPLICABLE TO PRODUCTS NOT MANUFACTURED BY PUREGRAFT OR BY A LICENSEE OR SUBLICENSEE THEREOF SHALL BE THE WARRANTIES, IF ANY, OF THE MANUFACTURERS OF THOSE ITEMS.

9. Trademarks.

9.1 Puregraft Marks. Puregraft owns or has the right to use certain trademarks, service marks and/or trade names in connection with the sale of the Products (the “Puregraft Marks”), including without limitation those trademarks, service marks and trade names used by Puregraft on or in conjunction with Products. Certain Puregraft Marks may be registered in the jurisdiction(s) which comprise the Territory.

9.2 Use of Puregraft Marks by Distributor. Puregraft hereby grants to Distributor an exclusive right and license to use the specified Puregraft Marks solely in connection with the promotion, sale and distribution of the Products within the Territory. This right shall expire upon expiration or earlier termination of this Agreement. This right and license shall not be assignable or transferable by Distributor in any manner whatsoever, provided, however, that Distributor may provide marketing materials containing the Puregraft Marks to sub-distributors for marketing purposes in the Territory. Distributor acknowledges that (a) Puregraft owns the Puregraft Marks and all goodwill associated with or symbolized by Puregraft Marks, (b) Distributor has no ownership right in or to any Puregraft Marks, except as granted herein. Distributor shall use Puregraft Marks only in the form and manner prescribed from time to time by Puregraft, although for clarity Distributor will have discretion over use of Distributor’s own trademarks and trade dress in packaging and marketing materials within the Territory. Distributor shall submit to Puregraft for its written approval before any use is made thereof, representative samples of all Products, stationery, invoices, catalogs, brochures, packages, containers, and advertising or promotional materials bearing any of Puregraft Marks which Distributor or its Agents prepare. Puregraft shall have the absolute right to approve or reject any proposed use of any of Puregraft Marks, in its sole discretion.

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9.3 Registration/Notice. Puregraft shall have the sole and exclusive right to obtain trademark registration worldwide for any Puregraft Marks or to take such other action with respect to the Puregraft Marks as it deems appropriate, and Distributor may not file registrations for any Puregraft Marks or any confusingly similar marks anywhere in the world. Distributor shall notify Puregraft promptly of any unauthorized use of Puregraft Marks or of any mark confusingly similar thereto which comes to its attention.

10. Patent Ownership and Rights to Inventions.

10.1 No Ownership By Distributor. Distributor shall not be deemed by anything contained in this Agreement or done pursuant to this Agreement to acquire any right, title or interest in or to any Puregraft Patents, trade secrets or technology, or any patent now or hereafter covering or applicable to any Product, nor in or to any invention or improvement now or hereafter embodied in any Product, whether or not such invention or improvement is patentable under the laws of any country.

11. Infringement of Third Party Rights.

11.1 No Warranty by Puregraft. Puregraft represents and warrants that, to its knowledge, the Products (including, without limitation any processes, techniques or know-how contained therein, or utilized in the manufacture or use thereof) will not infringe any Third Party Rights.

11.2 Notice and Defense. If any claim, action or notice is asserted against Puregraft or Distributor alleging that a Product infringes any Third Party Rights, the party first notified shall immediately notify the other party in writing of such claim, action or notice brought against Puregraft or Distributor. Puregraft may, in its sole discretion, select counsel for, and control the management, or defense with respect to any such claim, action or notice, provided that Puregraft will communicate pertinent decisions to Distributor in advance, and will consider in good faith any input provided by Distributor.

11.3 Third Party Infringers. If Distributor becomes aware that a third party is or may be making unauthorized use of (a) any patent owned by Puregraft, or for which Puregraft has the exclusive right of use, which relates to the Products (“Puregraft’s Patents”), Distributor shall promptly give Puregraft written notice thereof, which notice shall fully describe the potentially infringing action of such third party. Distributor shall consult with Puregraft with respect to any suit, injunction, or other action taken against such third party, and will consider in good faith any input provided by Puregraft. Distributor shall cooperate with Puregraft, at no out-of-pocket expense to Distributor, in connection with any action taken by Puregraft to terminate the infringements, seek damages, or otherwise seek redress for the infringement.

12. Claims.

12.1 Notice from Distributor. Distributor shall promptly notify Puregraft of any potential or actual claim, litigation or governmental activity in the Territory relating to the

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Products or the business operations of Distributor or Puregraft (“Claims”). Distributor shall provide such notice within seven (7) days from the time that Distributor learns of such Claims.

12.2 Indemnification by Distributor. Distributor assumes sole responsibility for all acts performed by it pursuant to this Agreement and shall be solely responsible for all Claims in connection therewith. Distributor shall indemnify, defend and hold Puregraft harmless from any and all claims, actions, lawsuits, demands, costs, liabilities, losses, damages and/or expenses (including reasonable attorneys’ fees and costs of litigation) by any other party resulting from or relating to any acts, omissions or misrepresentations of Distributor, its Agents or any of them.

12.3 Indemnification by Puregraft. Puregraft assumes sole responsibility for all acts performed by it pursuant to this Agreement and shall be solely responsible for all Claims in connection therewith. Puregraft shall indemnify, defend and hold Distributor harmless from any and all claims, actions, lawsuits, demands, costs, liabilities, losses, damages and/or expenses (including reasonable attorneys’ fees and costs of litigation) by any other party resulting from or relating to any acts, omissions or misrepresentations of Puregraft Distributor, its Agents or any of them.

12.4 Indemnifying party may control the defense of any claim for which indemnification is tendered, provided it promptly assumes such defense and selects counsel reasonably acceptable to the party to be indemnified, and provided reasonable assurances with respect to such defense can be provided. The indemnified party shall cooperate in the defense and shall have the right to consent to any settlement of the claims provided that such consent may not be withheld in the event that the proposed settlement fully releases the indemnified party from all Claims.

13. Insurance. To the extent commercially available, both Puregraft and Distributor shall maintain in full force and effect product liability insurance and property damage insurance on its operations, with coverage limitations and terms of $300,000 per occurrence and $1,000,000 total.

14. Term. Subject to section 15.3, the term of this Agreement shall be for a fixed period of three (3) years commencing on the Effective Date of this Agreement (the “ Term”). Up to four (4) one year extensions to the Term will be granted automatically to ELHI on an annual basis if the binding minimum purchase commitments defined in Year 4 through Year 7 in Schedule 1.2 are met or exceeded.

15. Suspension of Performance.

15.1 Suspension of Performance. Performance of a party’s obligations under this Agreement may be suspended:

(a) By either party if such other party breaches any of its obligations in this Agreement, or is in default of any term or provision hereunder, which, if curable, is not cured within thirty (30) days of delivery of the written notice of breach;

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(b) Immediately upon written notice delivered by either of the parties hereto to the other party in the event (i) an encumbrancer takes possession or a receiver is appointed over any of the property or assets of the other party, (ii) that other party makes any voluntary arrangement with its creditors or becomes subject to an administration order, (iii) that other party goes into liquidation (except for the purposes of amalgamation or reconstruction and in such manner that the company resulting therefrom effectively agrees to be bound by or assume the obligations imposed on that other party under this Agreement), (iv) anything that, under the law of any jurisdiction, is analogous to any of the acts or events specified in (i) - (iii) of this Section 15(b), or (v) that other party ceases, or threatens to cease, to carry on business.

15.2 In the event performance of its obligations under this Agreement has been suspended by either party pursuant to this paragraph 15, such party may sue such other party to recover damages equal to the minimum payments (in the case of Puregraft) or profits on minimum quantities of Product sold at the floor prices in Section 1.3 (in the case of Distributor) it would have received under this Agreement if such other party had fully performed under this Agreement.

15.3 Notwithstanding any other provision in this Agreement, Puregraft LLC (for clarity, as distinct from Puregraft as defined above) may terminate this agreement in its entirety with 12 months advance written notice, if notice is given in the first 3 years of the Term, or with 90 days written notice, if notice is given after the first 3 years of the Term, in the event: (a) a sale or license of all, or substantially all, of the assets of Puregraft LLC or any of its Affilates to a non affiliated company in an arm’s length transaction is pursued or (b) the a shareholder in Puregraft LLC elects to pursue a sale of all, or substantially all, of the equity in Puregraft LLC.

In the event a bona fide offer from a third party to engage in a transaction of the type described in Section 15.3(a) or 15.3(b) is pursued or received, Puregraft LLC will promptly notify Distributor and will in good faith support Distributor’s reasonable due diligence in order to facilitate Distributor’s competing bid during the 60 days after such notice. For the avoidance of doubt, Distributor shall not be entitled to the 1-year notice period described in the paragraph above unless the equity in Puregraft LLC is to be sold or substantially all of the assets in Puregraft LLC are to be sold or licensed, but shall be entitled to notification of the transaction and 60 days to formulate a competing bid.

Further, in the event that Puregraft LLC terminates this Agreement pursuant to this Section 15.3(a) or 15.3(b) Puregraft LLC shall continue to sell Product to Distributor on a non exclusive basis for non U.S. and non Canadian markets for 12 months after such termination, and Distributor shall be entitled to distribute such Product on a non exclusive basis to existing non U.S. and non Canadian customers (but not new customers) for 12 months after such termination. For the avoidance of doubt, Puregraft may pursue and solicit offers of any type, including for the type of transaction described in this section 15.3, and Puregraft LLC and its Affiliates shall have absolutely no liability to Distributor or its Affiliates for termination of this Agreement pursuant to this Section 15.3 as long as Puregraft LLC complies with the requirements of this Section 15.3. For the further avoidance of doubt, in the event this Agreement is terminated pursuant to

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this Section 15.3, or is terminated, or expires, for any reason, Distributor will pay all outstanding amounts owed to Puregraft LLC and its Affiliates and will immediately turn over to Puregraft LLC or its designee all customers in the Territory and customer information and will use its best efforts to fully and immediately transition such customers to Puregraft LLC or its designee.

15.4 At the conclusion of this Agreement, by termination or otherwise, Distributor will provide Puregraft with a copy of all Customer accounts and associated information in Distributor’s records, and all tangible and intangible records regarding the distribution of Puregraft Products (and Distributor may retain the same for its internal business purposes and regulatory and legal compliance purposes).

15.5 Excusable Delays. Puregraft shall not be liable for any delay in the manufacture or delivery of Products pursuant to the terms and provisions of this Agreement, or for any damages suffered by Distributor by reason of such delay, when such delay is, directly or indirectly, caused by, or in any manner arises from, fires, floods, accidents, riots, acts of God, war, governmental interference or restrictions, strikes, labor difficulties, back-orders, material shortages, regulatory or business interruptions, acts of Distributor or any other cause beyond the reasonable control of Puregraft, whether similar or dissimilar to the foregoing.

16. General Provisions.

16.1 Successors and Assigns. Distributor shall not have the right to assign any of its rights, delegate any of its duties, or sub-rep or contract out any of its duties under this Agreement without the prior written consent of Puregraft which may be withheld in its sole discretion, provided that Puregraft may not unreasonably withhold such consent.

16.2 Notices. All notices, requests, demands and other communications which may be given or are required to be given under this Agreement shall be in writing and in the English language. All notices may be sent by facsimile transmission, or confirmed e-mail transmission provided they are confirmed by letter, or sent by certified mail return receipt requested, and shall be deemed given on the date of confirmed transmission or five (5) days after mailing via a reputable carrier. All notices shall be addressed as set forth below, or to such other address as each party hereto may from time to time designate by written notice to the other party as provided herein:

To Distributor:

Establishment Labs Holdings, Inc.

4th St., Building B-15

Coyol Free Zone

Coyol, Alajuela

Costa Rica

Tel: (506) 2434-2400

Email: jchacon@establishmentlabs.com

Attention: Juan Jose Chacon, Chief Executive Officer

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To Puregraft:

Puregraft LLC

420 Stevens Avenue, Suite 220

Solana Beach, CA 92075

Tel: 858.348.8050

Fax: 858.408.4485

Email: bconlan@puregraft.com

Attention: Brad Conlan, CEO Puregraft LLC

16.3 Governing Law. This Agreement has been executed and delivered in, and shall be governed by and construed in accordance with the laws of the State of California, United States of America applicable to contracts made and performed in such state and without regard to conflict of laws provisions. The Convention for the International Sale of Goods will not apply.

16.4 Resolution of Disputes. In the event of any controversy or claim arising out of or relating to this Agreement, it shall be resolved through binding arbitration through the American Arbitration Association (the “AAA”) as provided herein. The parties hereto shall notice the other party and the AAA, demand that the dispute be fully and finally settled by binding arbitration in accordance with the Rules and Procedures of the AAA in San Francisco, California. The AAA shall appoint a single neutral arbitrator in accordance with their rules. The arbitration shall be conducted in English. Either party may seek interim injunctive relief from the AAA through the application for a special master. Service of process in any such action or proceeding brought hereunder may be made by mailing copies of such process to the address of notice to the parties provided for in this Agreement.

16.5 Headings. The headings herein are for convenience only, do not constitute a part of this Agreement, and shall not be deemed to limit or affect any of the terms or provisions hereof.

16.6 Waiver and Amendment. No waiver, amendment, modification or change of any provision of this Agreement shall be effective unless and until made in writing and signed by all of the parties hereto or constitute a continuing waiver by such party of compliance with such provision unless so stated.

16.7 Severability. The provisions of this Agreement are intended to be interpreted and construed in a manner so as to make such provisions valid, binding and enforceable. In the event that any provision of this Agreement is determined to be partially or wholly invalid, illegal or unenforceable, then such provision shall be deemed to be modified or restricted to the extent necessary to make such provision valid, binding and enforceable.

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

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16.9 Entire Agreement. This Agreement (including the exhibits and schedules hereto, each of which is incorporated herein and made a part of this Agreement) constitutes the entire agreement and understanding of the parties hereto and terminates and supersedes any and all prior agreements, arrangements and understandings, both oral and written, express or implied, between the parties hereto concerning the subject matter of this Agreement.

IN WITNESS WHEREOF, the parties hereto have executed and entered into this Exclusive Distribution Agreement as the date last signed below.



ESTABLISHMENT LABS HOLDINGS, INC.
By:	/s/ Juan Jose Chacon Quiros
Name:	Juan Jose Chacon Quiros
Title:	CEO
Date:	September 8, 2016

PUREGRAFT LLC.

By:	/s/ Bradford A. Conlan
Name:	Bradford A. Conlan
Title:	CEO, Puregraft LLC
Date:	September 8, 2016

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SCHEDULE 1.1

PRODUCTS AND PRICE LIST IN $USD (NOT INCLUDING US AND CANADA

[Intentionally Omitted]

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SCHEDULE 1.2

BINDING MINIMUM QUARTERLY PURCHASES IN $USD
(NOT INCLUDING US AND CANADA)

[Intentionally Omitted]

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SCHEDULE 1.3

END USER PRICING FLOOR IN $USD (NOT INCLUDING US AND CANADA)

[Intentionally Omitted]

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SCHEDULE 2.1

PRODUCTS AND PRICE LIST IN $USD (US AND CANADA)

[Intentionally Omitted]

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SCHEDULE 2.2

BINDING MINIMUM QUARTERLY PURCHASES IN $USD (US AND CANADA)

[Intentionally Omitted]

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SCHEDULE 2.3

END USER PRICING FLOOR IN $USD (NOT INCLUDING US AND CANADA)

[Intentionally Omitted]

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SCHEDULE 3.1

LIMITED WARRANTY

LIMITED WARRANTY. Puregraft LLC. (Puregraft) warrants that the Products will operate substantially in conformance with Puregraft’s published specifications and be free from defects in material and workmanship, when subjected to normal, proper and intended usage by properly trained personnel, for a period of one (1) year from the date of shipment to Buyer (the “Warranty Period”). Puregraft agrees during the Warranty Period, provided it is promptly notified in writing upon the discovery of any defect and further provided that all costs of returning the defective Products to Puregraft are pre-paid by Buyer, to repair or replace, at Puregraft’s option, defective Products so as to cause the same to operate in substantial conformance with said specifications. Replacement parts may be new or refurbished, at the election of Puregraft. All replaced parts shall become the property of Puregraft. Shipment to Buyer shall be paid for by Puregraft during the Warranty Period. Lamps, fuses, bulbs and other expendable items are expressly excluded from this limited warranty. In no event shall Puregraft have any obligation to make repairs, replacements or corrections required, in whole or in part, as the result of (i) normal wear and tear, (ii) accident, disaster or event of force majeure, (iii) misuse, fault or negligence of or by Buyer, (iv) use of the Products in a manner for which they were not designed, (v) causes external to the Products such as, but not limited to, power failure or electrical power surges, (vi) improper storage of the Products or (vii) use of the Products in combination with equipment or software not supplied by Puregraft. If Puregraft determines that Products for which Buyer has requested warranty services are not covered by the warranty hereunder, Buyer shall pay or reimburse Puregraft for all costs of investigating and responding to such request at Puregraft’s then prevailing time and materials rates. Puregraft will provide repair services or replacement parts that are not covered by the warranty during the Warranty Period subject to Buyer’s payment to Puregraft at Puregraft’s then prevailing time and materials rates for such repairs. IN NO EVENT SHALL PUREGRAFT’S TOTAL LIABILITY FOR ANY CLAIM OR ACTION IN CONNECTION WITH A PRODUCT EXCEED THE PURCHASE PRICE OF THE PRODUCTS OUT OF WHICH SUCH CLAIM OR ACTION AROSE. ANY DAMAGE CAUSED BY UNAUTHORIZED INSTALLATION, MAINTENANCE, REPAIR, SERVICE, RELOCATION OR ALTERATION TO OR OF, OR OTHER TAMPERING WITH, THE PRODUCTS PERFORMED BY ANY PERSON OR ENTITY OTHER THAN PUREGRAFT WITHOUT PUREGRAFT’S PRIOR WRITTEN APPROVAL, OR DAMAGE CAUSED BY USE OF REPLACEMENT PARTS NOT SUPPLIED BY PUREGRAFT, SHALL IMMEDIATELY VOID AND CANCEL ALL WARRANTIES WITH RESPECT TO SUCH DAMAGE.

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SCHEDULE 3.1

LIMITED WARRANTY

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Exhibit 10.14

Design , Architecture & Engineering , and
Build-Out Construction Management Agreement

This Design, Architecture & Engineering and Construction Management Contract (“Contract”) is entered at the city of Alajuela, Costa Rica on the 11 ^th day of the month of February of the year 2016, between:

ZONA FRANCA COYOL , S . A ., corporate identification card number three- one hundred one- four hundred and twenty thousand five hundred twelve (“ CFZ ”), registered in the Mercantile Section of the Public Registry under book five hundred sixty, entry ten thousand three hundred and seventy nine, consecutive one, hereon represented by Alvaro Carballo Pinto , personal identity card number one - five hundred and thirty six - six hundred and fifty five, and Huber Andre Garnier Kruse , personal identity card number one- four hundred sixteen- one thousand three hundred forty four, acting jointly and with sufficient authority for the execution of this lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book five hundred and sixty five, entry eleven thousand five hundred and ninety two, consecutive one, as certified in Schedule One.

for the one part and for the other,

Establishments Labs , S . A ., corporate identification card number three- one hundred one- three hundred and sixty nine thousand three hundred and thirty seven (“ Establishment ”), registered in the Mercantile Section of the Public Registry under book five hundred seventy four, entry sixty six thousand three hundred and seventy nine, consecutive one, hereon represented by Juan Jose Chacon Quirós , with personal identity card number one—eight hundred twenty two-cero cero six, with sufficient authority for the execution of this lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book two thousand and nine, entry two hundred twenty six thousand seven hundred and forty eight, consecutive one, as certified in Schedule One.

ESTABLISHMENT and CFZ are hereinafter individually referred to as a “Party” and collectively referred to as the “Parties”. The Parties, have agreed to enter into this Contract for the design, engineering, architecture, and construction management services in connection with Phase One of the project, and shall be governed by the following clauses:

Preamble:

1. Whereas, ZFC is the registered owner of a property, located in the “Condominio Horizontal Industrial Comercial con Fincas Filiales Primarias Individualizadas (FFPI) Zona Franca Coyol”(the “Condominium” or “Zona Franca Coyol”), condominium identity number 3-109533883, a condominium registered in the Costa Rican Public Registry, Province of Alajuela, Property Number M-2640- 000, filial lot number twenty six (26), hereinafter the “Property”, registered in the Public Registry Property of Alajuela, Property Number 68517- F- 000.

2. Whereas, ESTABLISHMENT wishes to complete the Build-Out of the shell building and install the corresponding manufacturing equipment and related improvements, in order to have a fully operational manufacturing facility (the “Facility”), all according to the contractual specifications and plans as agreed upon herein (collectively, the “Project”) for all effects of this Contract.

3. Whereas, ESTABLISHMENT desires to contract CFZ in order for CFZ to act as the Prime Service Provider of the Project and all other work and services required by this Contract, including without limitation all labor, materials, equipment and services required for the Project (collectively the “Work”) are to be performed and/or provided by CFZ , and the subcontractors hired by CFZ .

4. Whereas, ESTABLISHMENT intends to hire CFZ on a cost-plus basis whereby CFZ shall perform or cause to be performed the Work for the Cost of Work (hereinafter defined) plus the Prime Services Fee (hereinafter defined) and as described in the Construction Documents, all according to the contractual specifications and plans as agreed upon herein, and as disclosed to CFZ in the scope manual (the “Scope Manual”) provided by ESTABLISHMENT , and attached hereto as Schedule Eight.

5. Whereas CFZ is interested in performing the Project and all other work and services required by this Agreement, including without limitation all labor, materials, equipment and services required for the Project (collectively the “Works”).

6. Whereas CFZ is interested in completing all improvements to the Cold Shell Building activities at the sole cost and expense of ESTABLISHMENT as per the Design, Architecture & Engineering and Build-Out Construction Management Agreement.

7. Whereas ESTABLISHMENT will receive a credit from ZFC for a total amount of US$104,400.00 in relation to the concrete floor of the Cold Shell Building Lease Agreement scope of work; construction of the concrete floor is currently included within this Agreement.

8. Whereas parties agree that if any ESTABLISHMENT payment to ZFC is delayed for more than thirty (30) days due to an ESTABLISHMENT delay, then ESTABLISHMENT shall start paying Cold Shell Building rent, as per the Lease Agreement, and Rent Commencement Date shall start and be considered as the 31 ^st day of the delay in payment obligations by Establishment to ZFC .

Now therefore in consideration of the mutual promises herein made, and in consideration of the representations, warranties, and covenants herein contained, the Parties have agreed to as follows:

ARTICLE 1 RELATIONSHIP OF PARTIES AND EXTENT OF CONTRACT

1.1 The Parties do not have an employment relationship and do not intend to create a partnership or joint venture between them by this Contract. The relationship created by this Contract

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shall be that of independent contractor. Neither CFZ nor its employees shall be employees of ESTABLISHMENT for any purpose. CFZ shall be solely responsible for payment of salaries, social charges, insurance and any other employer responsibility related to its employees, and will request this same responsibility from all of CFZ’s subcontractors. ESTABLISHMENT shall be solely responsible for payment of salaries, social charges, insurance and any other employer responsibility related to its employees, and will request this same responsibility from all of ESTABLISHMENT subcontractors and shall fully indemnify CFZ for any related claims or liabilities to which it may become subject or costs which it may incur related to claims by its employees or its Subcontractor’s employees.

1.2 CFZ and ESTABLISHMENT accept the relationship in good faith; fair dealing and trust established by this Agreement and shall cooperate with each other in furthering the parties common interests. CFZ shall exercise its judgment and skill, and shall perform its services in an expeditious and economical manner for the benefit of ESTABLISHMENT . CFZ shall conduct its services in an efficient manner and shall diligently carry out its responsibilities under this Contract.

1.3 It is within CFZ’s discretion to decide whether any Work to be performed by CFZ will be performed by CFZ itself or by a subcontractor or subconsultant of CFZ , provided, however, that CFZ shall not subcontract with any person or entity with whom ESTABLISHMENT objects based on technical or economical basis, which objection may be made in ESTABLISHMENT’s sole discretion. This objection shall be appointed by written notification, and CFZ will remove this objected person or entity within ten days. CFZ shall employ the services of reputable, and well-qualified subcontractors (hereinafter “Subcontractors”) and professional, licensed and well-qualified architects, engineers and other design professionals in connection with the Project (hereinafter “Subconsultants”), only with ESTABLISHMENT prior written consent. All subcontractors and/or subconsultants approved by ESTABLISHMENT prior to the execution of this Agreement do not need further approval, but for any other work or service not included in the Purchase Orders. CFZ shall direct and coordinate the work of its Subconsultants and Subcontractors and shall be responsible for the work performed by them. Notwithstanding anything to the contrary in this Contract, ESTABLISHMENT consent to any Subconsultant or Subcontractor shall not in any way relieve CFZ of any duty, liability or responsibility to ESTABLISHMENT for the services provided by CFZ or any of its Subcontractors or Subconsultants.

ARTICLE 2 REPRESENTATIVES OF PARTIES

2.1 CFZ PROJECT MANAGER: CFZ has designated the person below as its designated representative for general management of this Agreement, (hereinafter referred to as the “ CFZ Project Manager”):

Name: Sebastian Acuna

Address: ________________

Phone: ________________

Fax: ________________

E-mail: ________________

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2.2 ESTABLISHMENT PROJECT MANAGER: ESTABLISHMENT has designated the person below as its designated representative for general management of this Agreement, (hereinafter referred to as the “ ESTABLISHMENT Project Manager”):

Name: Salvador Dada Santos

Phone: ________________

Email: ________________

ESTABLISHMENT Assistant Site Project Manager

Name : Christopher Morehead

Phone: ________________

Email: ________________

2.3 ESTABLISHMENT hereby provides a special power of attorney (in accordance with article 1256 of the Civil Code of Costa Rica, when required) and authorizes the ESTABLISHMENT Project Manager to act on behalf of ESTABLISHMENT or communicate with CFZ on behalf of ESTABLISHMENT with regards to the Work to the extent within the scope of this Agreement including Change Orders to be made. CFZ shall have the right to rely on such communications from the ESTABLISHMENT Project Manager as if ESTABLISHMENT made them directly.

For clarification purposes, additions and modifications to this Contract, the Build-Out Acceptance Report, and Change Orders are only valid if the ESTABLISHMENT Project Manager has accepted them in writing.

2.4 ESTABLISHMENT may also designate in writing an on “Site Assistant Project Manager”, to help assist the ESTABLISHMENT Project Manager. Therefore, in addition to furnishing the ESTABLISHMENT Project Manager with all information (s)he may require related to the Project, CFZ shall also provide the same information to the Site Assistant ESTABLISHMENT Project Manager. ESTABLISHMENT may designate a replacement Site Assistant ESTABLISHMENT Project Manager upon prior written notice to CFZ , however all decisions shall be executed by the ESTABLISHMENT Project Manager.

2.5 Both parties agree that any changes to their respective site project managers or assistant site project managers shall be communicated to the other party in written prior to (s)he being appointed to the position.

ARTICLE 3 SCOPE OF SERVICES

3.1 CFZ shall provide, or cause to be provided, all design and construction services, labor, and subcontractors, and other facilities and services necessary for the completion of the Works, described in the Contract Documents. CFZ shall perform and complete the Work as described in the Contract and Contract Documents, in a good and workmanlike manner, in accordance with the Contract Documents, and free of any and all liens, encumbrances, stop notices,

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charges, impositions, garnishments and attachment upon or against the Premises upon which the Project will be located.

3.2 CFZ shall provide to ESTABLISHMENT the Work in a single Phase, which shall be a part of the Work, and shall be performed in accordance with the Scope Manual and the Contract Documents.

3.3 CFZ will guide both Design and Build-Out Construction processes to fulfill ESTABLISHMENT expectations and requirements, as disclosed per the Scope Manual, until Final Completion, Acceptance of Works and hand-over to ESTABLISHMENT .

ARTICLE 4 CFZ’S PRE BUILD-OUT SERVICES

4.1 The Pre Build-Out Services shall include the following services:

4.1.1 CFZ will prepare schematic design and construction documents (the “Construction Documents”), that shall be approved by the Board of Engineers and Architects of Costa Rica (“Colegio Federado de Ingenieros y Arquitectos de Costa Rica”, CFIA), and CFZ shall be responsible for construction permits filing and for making its best efforts in order to obtain such permits. Costs and fees for permits will be ESTABLISHMENT’s obligation, and will be deemed Reimbursable Costs.

4.1.2 Project Organization: CFZ shall take the lead in Build-Out team organization and management, establishing effective systems to facilitate communication, control and coordination between ESTABLISHMENT and subcontractors.

4.1.3 Schedules: Project “ Master Schedule ”. CFZ shall prepare a master schedule to introduce discipline into the Project’s planning, coordination and monitoring by comprehensively incorporating all the Project’s activities, showing durations, sequence and interdependencies of both design and construction activities. CFZ shall be responsible for providing ESTABLISHMENT with biweekly updates as to the status of the work with respect to the project schedule and a monthly summary report. The current Master Schedule as attached hereto as Schedule Four.

4.1.4 ESTABLISHMENT Approvals: As per the Project Master Schedule ESTABLISHMENT shall review and approve all ESTABLISHMENT deliverables within the timeframe established in the Master Schedule; any delay on ESTABLISHMENT approvals shall be deemed as an ESTABLISHMENT delay. Final Completion date delivery shall be delayed on the equivalent number of days an ESTABLISHMENT approval was delayed.

Additionally CFZ shall develop with ESTABLISHMENT’s input and subject to ESTABLISHMENT’s approval, the following schedules:

4.1.4.1 Design Schedule & Progress Reviews . CFZ shall also develop a separate but corresponding design schedule focusing on the completion of design documentation. CFZ shall cause the preparation of, and shall review the Build-Out construction drawings, architectural, civil, mechanical, electrical, structural plans and specifications and advise and make

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recommendations with respect to such factors as possible economies, availability of materials and labor, time requirements for procurement and construction, and project costs. CFZ shall cause the preparation of, and shall review shop drawings and specifications, and coordinate under its best effort to eliminate evident areas of conflict and overlap in the work to be performed by the various trade Subcontractors.

4.1.4.2 “ Schedule of Resources ”. This schedule shall be used to coordinate the Project’s budget estimate, schedule the anticipated stakeholders of the Project, and chart the planned and actual cash flow and stakeholders required to complete the Project.

4.1.5 Establishing Control Budget Estimate . CFZ will work closely with ESTABLISHMENT Project Manager to confirm the actual scope of the work and assign values to the various components of the Project. In order to avoid increases in cost on this Project, CFZ will utilize the following tools to establish a disciplined approach towards identifying and correcting deviations:

4.1.5.1 “ Initial Budget Estimate ”. This estimate will forecast Build-Out construction costs on the basis of historical data and local market conditions, as well as any existing bids.

4.1.5.2 “ Budget and Cash Flow ”. CFZ will review and comment on the Initial Budget Estimate for the entire Project and in parallel to the preparation of the Master Schedule, provide a cash flow study so that ESTABLISHMENT understands the Project’s requirements for cash draws on a monthly basis.

4.1.5.3 Analyze Alternate Systems . Review major systems and components of the Building (e.g. mechanical and electrical systems, exterior wall systems, control systems, and major architectural finishes) to identify potential cost savings and efficiencies. CFZ will consider not only the first installation cost but also maintenance costs for such systems and materials.

4.1.5.4 Any and all schedules, estimates, budgets and Build-Out construction related documents prepared by CFZ will be subject to approval for use on the Project by ESTABLISHMENT Project Manager. ESTABLISHMENT shall provide approval or denial of such schedules, estimates, budgets and construction related documents within five calendar days of receiving such documents.

4.1.6 Bid Packages . Bidding processes may be required for subcontracts (except design services contracts) that exceed US$ 100,000.00. In such cases CFZ shall develop bidders’ interest in the Work, and establish bidding schedules. CFZ shall issue bidding documents approved by ESTABLISHMENT to bidders and conduct pre-bid conferences with prospective bidders. CFZ shall answer questions from bidders and issue the necessary addenda. ESTABLISHMENT shall have the right to attend any Pre-bid conferences and actively participate in these processes.

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CFZ shall receive bids, prepare bid analyses and make recommendations and comment with ESTABLISHMENT the results of the bid for all subcontractors required during the Build-Out Preconstruction stage and the Build-Out Construction stage, in order to ensure compliance with Project requirements, budget and scope. CFZ shall provide ESTABLISHMENT with at least three qualified bids, unless otherwise authorized by ESTABLISHMENT . ESTABLISHMENT shall necessarily choose one of those three bids provided, unless ESTABLISHMENT has a reasonable objection in which case ESTABLISHMENT can direct CFZ to seek new bids, provided that any impact to the Master Schedule will be deemed as an ESTABLISHMENT delay. CFZ will sign a Contract for such works with the accepted contractor in accordance with the terms of the bid subject, however, to the terms and conditions of this Contract.

4.1.7 ESTABLISHMENT shall approve all bidding packages within the time frame provided in the Master Schedule; any delay on such approval shall be deemed an ESTABLISHMENT delay. Final Completion date delivery shall be delayed on the equivalent number of days an ESTABLISHMENT approval was delayed.

4.1.8 Safety Program . CFZ will review and apply requirements for job site safety as provided by its safety manual and applicable local and reasonable international legislation, which will be required in all Subcontractors’ contracts. CFZ will enforce implementation of such requirements, including its incorporation into the packaged bidding process. CFZ will prepare a safety manual for the Project and report followed by periodic monitoring and reporting procedure to be followed throughout the duration of the Project. CFZ shall use reasonable efforts to keep the Site and Works clear o unnecessary obstruction so as to avoid danger to these persons according to the Costa Rican environmental and Labor and Occupational Hazard and Safety and Health laws and by-laws.

4.1.9 Quality Control Plan . CFZ will provide guidelines for a quality control program, incorporating all Subcontractors, separate contractors hired directly by ESTABLISHMENT (if any) and ESTABLISHMENT activities, and will enforce it during the works. CFZ’s approach shall include a review of the Build-Out Construction Documents, shop drawings and specifications. From this review, problems will be identified and discussed with the Subcontractors so that the correct standards and procedures are employed in the bid process. Subsequently, CFZ will carefully monitor the bid process so that there is a complete understanding of the installation techniques and the quality control standards.

4.1.10 Protection of the Environment : CFZ and the Subcontractors shall take all reasonable steps to protect the environment (both on and off the Site) and to limit damage and nuisance to people and property resulting from pollution, noise and other results of his operations. The Contractor shall ensure that emissions, surface discharges and effluent from the Contractor’s activities shall not exceed the values indicated in The Developer’s Requirements, and shall not exceed the values prescribed by applicable Laws. Environmental Management System which shall be based on the UNE-EN ISO 14001: 2000/200 Standard . Contractors shall thereafter implement the Environmental Management System, through the Environmental Program. Under the instructions of CFZ , Contractors shall at all times comply with, and shall cause its Subcontractors to comply with, the Environment Management Procedures and Program. Parties agree that any

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additional cost related to compliance with Environmental Management System based on UNE-EN ISO 14001 : 2000/200 Standard shall be covered by Establishment .

4.1.11 ESTABLISHMENT may perform periodic audits to verify application of the compliance on every and each of those programs and its results. If, as a result of an audit, ESTABLISHMENT detects any non-conformity to the requirements, ESTABLISHMENT may notify CFZ of such non-conformity. The Contractor shall resolve the instances of non-conformity specified in the audit within a period of fifteen (15) days. Notwithstanding the foregoing provisions of this Clause, CFZ shall at all times remain responsible for making sure all contractors and subcontractors comply with all environmental prevention, mitigation and control measures imposed by Costa Rican Governmental Requirements, and/or SETENA Administration, The Developer’s Environment Supervisor (Regente Ambiental) and other provisions set off in this Contract.

4.1.12 Subcontractors . CFZ shall prepare and award the Build-Out construction contracts necessary to complete the Project (collectively, the “Subcontracts”). CFZ shall negotiate and prepare the biding process for the corresponding contract, and provide ESTABLISHMENT with at least three bids to choose from, unless otherwise authorized by ESTABLISHMENT , and make recommendations as to the one CFZ considers appropriate for the Work. All Subcontracts shall be directly between CFZ and its subcontractors. For purposes of this Contract, Work shall be defined as all of the design services, Build-Out construction, work, labor, materials, equipment, machinery, tools, supplies, services and other items provided by CFZ or subcontracted to the Subcontractors. CFZ shall also advise on the division of the Project into individual Subcontracts for various categories of Work, including the method to be used for selecting Subcontractors and awarding Subcontracts. If multiple Subcontracts are to be awarded, CFZ shall review the Build-Out Construction Documents and make recommendations as required to provide that (1) all requirements for the Project have been assigned to the appropriate Subcontract, (2) the likelihood of jurisdictional disputes has been minimized, (3) the Work of the Subcontractors is coordinated, and proper coordination has been provided for phased construction and (4) The Subcontracts have sufficient guarantees, such as withholding guarantees and performance bonds, in order to ensure fulfillment of Subcontractors’ obligations.

4.1.12.1 CFZ shall receive certificates of insurance from the Subcontractors and hold them. The insurance to be provided by Subcontractors will name ESTABLISHMENT as additional insured.

4.1.12.2 Subcontractors shall have all their personnel fully covered on all the local social security and labour regulations.

4.1.12.3 CFZ shall be responsible for the overall coordination among all of the Subcontractors. CFZ shall also monitor all Project construction to assure that all Subcontractors are acting in compliance with their respective Subcontracts, endeavoring to guard Project against defects;

4.1.12.4 Subcontractors, suppliers and sub-subcontractors of any tier are not intended to be and shall not be third party beneficiaries of this Contract.

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ESTABLISHMENT shall approve all subcontractor offers within the time frame provided in the Master Schedule, any delay on such approval shall be deemed an ESTABLISHMENT delay. Final Completion date delivery shall be delayed on the equivalent number of days an ESTABLISHMENT approval was delayed.

4.1.13 Layout . CFZ will attend meetings with ESTABLISHMENT technical representatives for layout proposal, review layout design alternatives when solicited and collaborate in final freeze of layout design. ESTABLISHMENT shall approve final layout within the time frame provided in the Master Schedule, any delay on such approval shall be deemed an ESTABLISHMENT delay. Final Completion date delivery shall be delayed on the equivalent number of days an ESTABLISHMENT approval was delayed.

4.1.14 Preliminary Architecture and Engineering ( A&E ) Design based on Schematics . CFZ will review the Scope Manual provided by ESTABLISHMENT for every discipline supplied by ESTABLISHMENT and develop: i) schematic drawings with systems preliminary design, ii) written design brief describing project systems, iii) preliminary equipment dimensioning, iv) description of special systems and room by room plans to review needs for each area, v) including all systems information. This information will become the baseline for the Drawings, Specifications and other documents to be developed by CFZ or its Subcontractors for Build-Out construction purposes. ESTABLISHMENT shall approve all Design packages within the time frame provided in the Master Schedule; any delay on such approval shall be deemed an ESTABLISHMENT delay. Final Completion date delivery shall be delayed on the equivalent number of days an ESTABLISHMENT approval was delayed.

4.1.15 Long lead materials and equipment: CFZ shall coordinate and expedite the ordering and delivery of materials and equipment requiring long lead time. ESTABLISHMENT shall approve all Long Lead item packages within the time frame provided in the Master Schedule, any delay on such approval shall be deemed an ESTABLISHMENT delay. Final Completion date delivery shall be delayed on the equivalent number of days an ESTABLISHMENT approval was delayed.

4.1.16 Special Consultants: CFZ shall assist, retain, select, and coordinate the professional services, special consultants, testing laboratories and surveyors required for the Project, including all those Engineers and Architects not specified as part of CFZ’s staff for the Project. None of the Special Consultant’s prices or fees are included in the CFZ’s Build-Out Construction Management Fee. Therefore they will be deemed Reimbursable Costs. ESTABLISHMENT Project Manager, shall authorize any special consultants not previously approved. Fees of Special Consultants that are hired directly by ESTABLISHMENT will not be included as part of the Contract Sum, and CFZ will not charge the Build-Out Construction Management Fee established below regarding the invoices presented by these special consultants hired by ESTABLISHMENT .

4.1.17 Permits: CFZ shall file, and make its best efforts in order to obtain Build-Out construction permits in a timely manner in accordance with the Master Schedule. CFZ shall ensure that all applicable assessments and fees have been paid. ESTABLISHMENT shall assist CFZ in the

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filing of documents required for the approvals of governmental authorities having jurisdiction over the Project. Permits will be deemed Reimbursable Costs.

The overall schedule of the project is subject to the permits being approved. If permits are not approved prior to the start of construction despite CFZ’s reasonable efforts to obtain such permits and provided CFZ has diligently and proactively processed such permits, the project schedule and budget will be reassessed to reflect not more than a day-for-day delay and actual costs resulting from such delay.

If any such delays are caused by, or related directly to the design, the condominium, or the execution of the works, such delays shall not be the responsibility of ESTABLISHMENT .

4.1.18 CFZ Deliverables: CFZ shall provide the following deliverables by the conclusion of the Build-Out Pre Construction Stage:

4.1.18.1 Conduct schematic design review.

4.1.18.2 Construction documents from all disciplines.

4.1.18.3 Establish the Master Schedule including major milestones and decision dates.

4.1.18.4 Develop an Initial Budget Estimate based on the Schematic Documents.

4.1.18.5 Create a site safety plan.

4.1.18.6 Establish a procurement strategy including long lead items and equipment purchases.

4.1.18.7 Preparation of and assistance in the development of all bid packages and award of Subcontracts applicable at the time.

4.1.18.8 Prepare comparison chart of Subcontractors offers and make recommendation.

4.1.18.9 Review layout and Scope Manual prepared by ESTABLISHMENT .

4.1.18.10 Design development of Architecture and Engineering documents.

4.1.18.11 Permit filing, tracing of such filings and presenting additional information or clarifications when required.

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4.1.19 ESTABLISHMENT Deliverables: ESTABLISHMENT shall provide the following deliverables for the Build-Out Pre Construction Stage:

4.1.19.1 Secured funds for Build-Out construction.

4.1.19.2 All due payments to CFZ by ESTABLISHMENT related to the Build-Out Pre-Construction Stage must have been completed as per the amounts and dates specified in this Contract. CFZ will not start the Build-Out Construction stage unless all due payments have been honored.

4.1.19.3 Approval of all Schematic Design and Construction Documents. After approval by ESTABLISHMENT all documents will be “freezed” and any changes to plans, blue prints, specifications, or any other document shall be made through the Change Order process established on this Contract.

4.1.19.4 Finance and accounting structure in place to support payment process between CFZ and ESTABLISHMENT .

4.1.19.5 CFZ will have the right to refuse the start of the Build-Out Construction Stage if any of the above conditions are not met by ESTABLISHMENT . ESTABLISHMENT shall approve all deliverables within the time frame provided in the Master Schedule, any delay on such approval shall be deemed an ESTABLISHMENT delay. Final Completion date delivery shall be delayed on the equivalent number of days an ESTABLISHMENT approval was delayed.

ARTICLE 5 CFZ’S SERVICES IN RELATION TO BUILD-OUT CONSTRUCTION AND GENERAL CONTRACTING

5.1 The “Build-Out Construction Stage” shall start with a proper Commencement of Works pursuant to ESTABLISHMENT completion of deliverables established in section 4.1.15, emission of written start order and acceptance by CFZ , and end upon Final Completion by CFZ and Acceptance by ESTABLISHMENT . CFZ shall provide the following Build-Out Construction Stage Services to ESTABLISHMENT for the Build-Out Construction Stage:

5.1.1 During the Build-Out Construction stage of the Project, CFZ will provide the following Construction related services as well being directly responsible to ESTABLISHMENT for the actual performance of the Work, provided ESTABLISHMENT fulfills payment:

A. Scheduling

B. Budget and Cost Control

C. Supervision of Subcontractors

D. Cash Flow Control, Accounting and Exemptions

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E. Job Closeout

F. Design Development and Specifications

G. Construction Documents

H. Multidisciplinary Inspection

In addition, all Construction Documents complement each other, and anything required in one shall be binding for all. If there are any ambiguities or discrepancies, the following hierarchical order as to their prevalence shall apply:

a) This Contract, including executed changes to this agreement;

b) Addenda to this Agreement; and

c) Construction Documents.

Furthermore, in each specialized field, the specialized plans shall prevail over the general ones, the drawings at larger scale shall prevail over those of lower scale, and the dimensions specified shall prevail over measurements at scale.

The following is a further description of the full scope of CFZ’s Build-Out Construction Stage Services.

5.2 Work performed by Subcontractors . CFZ will be responsible for ensuring that all of its Subcontractors act in accordance with all obligations and regulations that are contained in or are derived from this Contract and the other Construction Documents including, without limitation, the General Conditions. CFZ shall request from all Subcontractors guarantees for all Work, in the amount and terms consistent with CFZ’s obligations set forth in this Contract. In the event that ESTABLISHMENT terminates this Contract due to a breach of CFZ’s obligations contained herein, CFZ agrees to assign to ESTABLISHMENT , at ESTABLISHMENT request, it rights under any or all subcontracts for the Work and/or all rights it may have against all Subcontractors related to warranties and guaranties provided on the Work once all due payments to CFZ by ESTABLISHMENT have been completed.

5.3 Scheduling: A vital management tool of CFZ on the Project will be the Master Schedule and Detail Schedules. Recognizing the importance of the scheduling process, CFZ will utilize the following tools to monitor and control the rate and sequence of Work. ESTABLISHMENT shall approve all deliverables within the time frame provided in the Master Schedule; any delay on such approval shall be deemed an ESTABLISHMENT delay. Final Completion date delivery shall be delayed on the equivalent number of days an ESTABLISHMENT approval was delayed.

5.3.1 Master Schedule: Master Schedule will be developed during Build-Out preconstruction stage, and refers to a realistic overall schedule outlining in general terms all

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activities from the earliest feasibility studies to final construction completion of all phases of the Project. This Master Schedule is an overall schedule of the total Project, and forms the basis for subsequent scheduling.

5.3.2 Detail Schedules: During construction the Master Schedule is broken down into more detailed components. These Detail Schedules monitor and manage the day-to-day construction activities while still being tied back to Master Schedule.

5.3.3 CFZ shall update all schedules monthly using the schedules provided by the Subcontractors, labor and equipment, and shall incorporate the activities of the Subcontractors on the Project, activity sequences and durations, allocation of labor and materials, processing of shop drawings, product data and samples, and delivery of products requiring long lead time and procurement. CFZ’s responsibility is to assemble this information and present it to ESTABLISHMENT for review. CFZ shall update and reissue the Master Schedule as required to show current conditions. If an update indicates that the previously approved Master Schedule is showing any delay, CFZ will perform corrective actions, unless the delay is due to ESTABLISHMENT actions for failure to perform such actions, in which case, if additional funds or resources are justified and required due to such delay, the established Change Order procedure will be followed.

5.3.4 CFZ shall prosecute and perform the Work with the utmost dispatch consistent with good workmanship and agrees to complete the Work in accordance with the Master Schedule provided that no Force Majeure, Acts of God or any of the causes set in Articles 5.3.4.1 through 5.3.4.5 occur during the Build-Out Construction Stage. It is agreed that time is of the essence of this Contract and of all the provisions thereof. CFZ shall be entitled to have an extension of the Master Schedule if and to the extent that completion of the whole Project is delayed solely by any of the causes set forth in Articles 5.3.4.1 through 5.3.4.6.

5.3.4.1 If rain on the construction site is documented to have caused an inability to conduct Build-Out construction, using reasonable and normal construction procedures and standards.

5.3.4.2 A Force Majeure event. As used in this Contract “Force Majeure” shall mean any event which (i) cannot be reasonably anticipated or controlled, (ii) which significantly affects contracted performance, and (iii) is not reasonably subject to the control of the party invoking it, whether (A) related to nature, including but not limited to fire, lightning, earthquake, or windstorm, flood or the like, or (B) related to man, such as but not limited to unforeseen adverse political or economical events, civil insurrection, war, strikes or other labor disturbances provided such strikes or labor disturbances affect the Costa Rican construction industry generally, or changes in the law or third party actions which, in both cases, could not have reasonably been foreseen.

5.3.4.3 Any delay, impediment or prevention caused by ESTABLISHMENT , its representatives, its contractors or vicarious agents (other than CFZ and CFZ Subcontractors), and/or ESTABLISHMENT visitors, including delays caused by Change

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Orders given by ESTABLISHMENT , to the extent such delay has been notified in written to ESTABLISHMENT , or the applicable Change Order as more fully set forth in Article 6, as well as delays due to failure of ESTABLISHMENT to respond to CFZ’s inquiries, or to provide approvals, or delays caused due to lack of payment (such delays, a “ ESTABLISHMENT Delay”).

5.3.4.4 Unforeseen delays due to governmental or the corresponding authority decisions not attributable to CFZ’s acts or omissions, including delays caused by the terms taken by the corresponding institutions and authorities in order to grant any permits required for the implementation of all planning, provided that CFZ has initiated and proceeded diligently with the necessary filings and has provided all the required information as requested by authorities.

5.3.4.5 Delays by ESTABLISHMENT in making corresponding payment within the terms provided in the Payment Schedule, which delay exceeds ten (10) calendar days.

5.3.4.6 An Onerous Event. As used in this Agreement “Onerous Event”shall mean any action of, or failure to act by, the government of Costa Rica or any relevant authority (including, without limitation, (a) any change (whether by the introduction, modification or application of any law, decree or regulation or otherwise) after the Effective Date in the legal framework in effect, (b) any embargo, expropriation, nationalization or act of eminent domain not constituting an expropriation, (c) any devaluation or adverse change in the currency of Costa Rica, (d) any revocation or other withdrawal of any consent other than in accordance with the provisions thereof or any agreement relating thereto or in accordance with the legal framework in effect, and (e) any failure by the government of Costa Rica or any relevant authority to act in accordance with the legal framework in effect, which action or failure to act adversely changes the legal, economic or commercial position of the Project, CFZ or any Subcontractor, from what it was on the Effective Date or from what it is or what it would have been but for such action or failure to act.

CFZ shall, within a five (5) working days period, notify ESTABLISHMENT in writing of any delays and its impact towards the Delivery Date in the Master Schedule caused by ESTABLISHMENT or its separate contractors, as well as any event that would permit an extension of time. If CFZ is delayed in the performance of CFZ ’s Work by reason of a ESTABLISHMENT Delay (including delays in approvals of Change Orders, plans, etc.), then, subject to CFZ’s compliance with the foregoing notice provision, the Hand Over Date which is affected by such ESTABLISHMENT Delay shall be extended accordingly.

Any delays in the performance of CFZ’s Work caused by changes in CFZ’s Work requested by ESTABLISHMENT (“ ESTABLISHMENT Changes”) and not related to any negligence or breach of contract by CFZ shall be deemed to be a ESTABLISHMENT Delay.

5.4 Cost Control: CFZ’s cost control process can be implemented to monitor actual construction costs versus the accepted budget. Beginning with initial contract awards, the cumulative amount of committed funds is carefully monitored. The data is compiled and continuously compared to the approved estimate and updated by means of the monthly Budget Execution Report. CFZ or a Subcontractor, as determined among such parties, shall be responsible for all non-approved by

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ESTABLISHMENT cost-overruns, if any, of the Subcontractors, unless such excess costs have been approved by ESTABLISHMENT pursuant to a Change Order.

5.4.1 Construction Budget: An Initial Estimate Budget will be created by CFZ in the Build-Out Preconstruction Stage, which shall be updated as provided for the schedules in Article 5.3 above. Each additional budget will be based on the documents issued at that time and will be compared with the Initial Estimate Budget or to the subsequent budget and the Contract Sum. The next budget will be based on the Build-Out design development documents. CFZ will develop an itemized budget estimate and will assist in the subcontractor availability in the local market. Each additional budget shall be approved in writing by ESTABLISHMENT .

5.4.2 “ Budget Execution Report ” : A contract cost report is issued monthly summarizing the current financial status of the Project. The report shows the approved budget and notes all variances from that estimate due to changes initiated by ESTABLISHMENT or other required modifications. CFZ shall prepare the Budget Execution Report. The Budget Execution Report shows changes in two categories: “approved,” i.e. a Change Order has been approved by ESTABLISHMENT; “potential,” i.e. change estimate has been submitted and awaits approval by ESTABLISHMENT or an approximate estimate has been developed and submitted as an early warning system for identifying potential cost. CFZ shall develop cash flow reports and forecasts for the Project and advise ESTABLISHMENT as to variances between actual and budgeted or estimated costs. Acceptance and approval of all cash flow reports and forecasts prepared by CFZ will be subject to ESTABLISHMENT approval.

5.4.3 Payment Application and Change Order Procedures: CFZ shall submit Payment Applications for all Work performed, whether performed by itself or by Subcontractors and work with ESTABLISHMENT to establish a monthly Application for Payment procedure, including supporting documentation. CFZ will also develop a detailed Subcontract Change Order procedure control plan that shall apply to CFZ and all Subcontracts. As part of such plan, CFZ shall review requests for changes, assist in negotiating Subcontractors’ proposals, submit recommendations to ESTABLISHMENT , and, if approved by ESTABLISHMENT , prepare documentation that incorporates the modifications to the applicable Subcontract. All applications for progress and final payment to Subcontractors will be sent to CFZ by Subcontractors, who shall review them and if approved, request final payment from ESTABLISHMENT .

5.4.4 According to the version of the Initial Budget Estimate, negotiated between the parties as of the date of this contract execution, the total Initial Budget Estimate Construction Cost of Work represents a total amount of five million eight hundred twenty eight thousand and ninety dollars with fifty three cents, legal tender of the United States of America ( US$ $5 , 828 , 820 . 00 ). All payments based on latest Initial Budget Estimate shall be made by ESTABLISHMENT to CFZ according to approved Cash Flow, as shown on Schedule Eleven. Initial Budget Estimate doesn’t include the concrete floor credit from Lease Agreement.

5.4.5 Review of Applications for Payment from Subcontractors . Within seven days after receipt of a Subcontractor’s payment application, CFZ shall review the payment application and all supporting documentation for the amounts claimed due to be in compliance with

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the applicable Subcontract and this Contract, and if CFZ approves such payment application CFZ shall forward to ESTABLISHMENT an equivalent CFZ Payment Application in accordance with the terms of this Contract.

5.4.5.1 For each Payment Application the CFZ Project Manager will review the Master Schedule and detailed work activities and any other documents necessary to determine the percent complete and the value of the installed work in accordance with the total cost of such work, with ESTABLISHMENT Project Manager; provided, any such review or failure to review by ESTABLISHMENT Project Manager shall not release CFZ or ESTABLISHMENT of its obligations, representations and warranties with respect to such Payment Application.

5.4.5.2 ESTABLISHMENT’s Project Manager shall have a term of three calendar days to approve the Payment Application. Once the Payment Application has been approved, CFZ will submit the corresponding invoices to ESTABLISHMENT and ESTABLISHMENT shall pay for such invoices within the following ten (10) calendar days after an acceptable invoice was submitted. The monthly payment will not be a fixed amount but will depend on deliverables and Work completed through the date of Payment Application.

All invoices and Payment Applications shall be submitted via e-mail as follows:

Attention:

Name: Jimmy Villalobos

Email: ________________

5.4.5.3 ESTABLISHMENT shall make payments of the amounts due to CFZ in accordance with the Payment Application and as provided herein.

5.5 Subcontractor Supervision and Responsibility . CFZ shall be fully responsible for all aspects of any Subcontractor’s performance of any part of the Work that have been contracted directly by CFZ . CFZ shall accomplish this through the effectiveness of the following:

5.5.1.1 Meetings : CFZ will coordinate and manage coordination meetings. CFZ will review the schedule, workmanship quality and cost.

5.5.1.2 Field Supervision: CFZ will maintain field staff to monitor and coordinate all field construction activities. Such staff will schedule and conduct meetings with the Subcontractors to control the supply and utilization of their manpower, materials and equipment they are responsible for quality control and enforcing the Project Specific Safety Program and Quality Programs. CFZ will observe all testing performed by the Subcontractors as required to verify conformance with contractual Subcontracts for each aspect of the project including start-up and check out of utilities, operational systems and equipment.

5.5.1.3 CFZ shall arrange and coordinate for the Subcontractor’s performance of the delivery, storage, protection and security of materials, systems and equipment

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that are a part of the Project until such items are incorporated into the Project. CFZ agrees to hold harmless ESTABLISHMENT with respect to any loss of or damage to such to such materials, systems and equipment was due to CFZ’s or Subcontractor’s negligence or willful misconduct.

5.5.1.4 CFZ shall maintain on a current basis at the Project site records of all Subcontracts, Build-Out Construction Documents, drawings, specifications, addenda, Change Orders and other modifications, samples, purchases, materials, equipment, maintenance and operating manuals and instructions, and other construction-related documents, including all revisions and all the records under the CFIA Bylaws;

5.5.1.5 CFZ shall answer all questions for interpretation of the Build-Out Construction Documents.

5.5.1.6 Monthly Progress Report: CFZ will be submitting a monthly Project update report that will include:


•	Executive Summary.


•	Progress Pictures.


•	Permit Log Update.


•	Master Schedule Update including Work completed for the period.


•	Long-lead Items Status.


•	Design Log Update.


•	Quality Control Report.


•	Budget update including cash-flow and forecast reports, and cumulative total of the cost of the Work to date including compensation of CFZ and Reimbursable Costs (authorized and claimed), if any, and all sums paid to Subcontractors, as well as the amounts pending.


•	Reasonable critical Information required by ESTABLISHMENT .

5.5.2 Quality Control: CFZ’s Quality Control Program starts during the Build-Out Preconstruction Stage and continues through the entire life of the Project. During the design period, CFZ will review Subcontractor shop drawings and specifications, and other submittals and documents prepared by the Subcontractors (“Submittals”) for conformance to the applicable Subcontract and Build-Out Construction Documents. CFZ shall identify and document any problem areas and have them solved with Subcontractors, and confirm that Subcontractor understands the installation techniques and the quality control standards that will be expected and enforced. The first operation of any new trade is closely monitored to assure that the expected level of workmanship is established from the outset. A day-to-day check of the Work is made by the appropriate staff of CFZ

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to guarantee that the level of consistency is maintained. CFZ shall monitor and review all Work for conformance to the Build-Out Construction Documents. Cost of laboratory tests is not included in CFZ’s Build-Out Construction Management Fee.

5.5.2.1 CFZ shall assist in scheduling and monitor of the sequence of the Work in accordance with the Build-Out Construction Documents and the latest approved Master Schedule. The Master Schedule and all budgets shall be approved in written by ESTABLISHMENT after review and comment by CFZ . CFZ shall inform ESTABLISHMENT in advance of any event that may create a delay in the Work or increase in any Project budget. Upon informing ESTABLISHMENT of such an event, CFZ shall assist the Subcontractors in developing cost effective solutions to such an event for ESTABLISHMENT review and approval. CFZ and the Subcontractors shall perform all corrective work in accordance with ESTABLISHMENT recommendation on any remedial plan.

5.5.3 Cash Flow control, exemptions and accounting:

5.5.3.1 Cash Flow Control : CFZ shall communicate with all Subcontractors at the Project in regard to payment procedures. CFZ shall establish a monthly payment application procedure consistent with the payment provisions of this Contract.

5.5.3.2 Exemptions: CFZ is a Free Trade Zone Regime beneficiary, and as part of its benefits it is exempted of import duties and of local sales taxes. CFZ shall, as process facilitator, acquire all local materials and services, and import and process materials and/or equipment that will be used or installed in connection with Project, to the fullest extent permitted by PROCOMER and applicable law, until such items can be transferred to ESTABLISHMENT (if applicable), under the proper customs procedures. CFZ will transfer all exempted works, materials and equipment to ESTABLISHMENT at the end of Build-Out construction of the Project if applicable.

5.5.3.3 Accounting: CFZ shall keep all construction accounting and control of the exemptions in order to help ESTABLISHMENT to take full advantage of the free zone exemptions and at the same time have a direct control of the Project disbursements and cash flow. CFZ shall not be liable for any lost or rejected exemption in materials or inventory by the respective legal authorities, provided it has requested such exemptions diligently.

5.6 CFZ shall provide the following deliverables by the conclusion of the Build-Out Construction Stage to ESTABLISHMENT:

5.6.1.1.1 As built drawings (printed and/or digital versions)

5.6.1.1.2 Required documents for Commissioning.

5.6.1.1.3 Operations and Maintenance Manuals.

5.7 Design Development and Specifications : CFZ will develop the design based on approved layout and scope manual provided by ESTABLISHMENT .

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5.7.1 Construction Documents: Design Architects and Engineers will prepare detailed construction drawings of all systems, final specifications, final equipment selections, including all information to allow Subcontractors and vendors to price the work. Shop drawings and other installation drawings are responsibility of the Subcontractors but if any claim shall be filed against such Subcontractor, CFZ will coordinate such filing with ESTABLISHMENT as required.

5.8 CFZ’S Authority: CFZ shall advise and consult with ESTABLISHMENT during the performance of its Build-Out Construction phase of the Work. CFZ shall have no authority to act on behalf of ESTABLISHMENT except to the extent of authorizations explicitly granted pursuant to this Contract. In no event shall CFZ be considered an agent of ESTABLISHMENT or be expressly authorized to enter into contacts on behalf of ESTABLISHM ENT .

5.9 Access to the Work: The Subcontractors and CFZ shall provide ESTABLISHMENT access to the Work in preparation and progress wherever located.

5.10 Inspection: ESTABLISHMENT ’s Personnel shall at all reasonable times: have full access to all parts of the Site and to all places, and during production, manufacture and construction (at the Site and, to the extent specified in the Contract, elsewhere), be entitled to examine, inspect, measure and test the materials and workmanship, and to check the project progress.

ARTICLE 6 CHANGE ORDERS

6.1 Alterations, additions or deductions may be made in the Work herein, but said alterations; additions or deductions may only be made by means of a Change Order.

6.1.1 ESTABLISHMENT may request a Change Order in writing to CFZ , in the form attached hereto as Schedule Six, “Change Order Request”. Such Change Order Request shall include a description of the required work and technical specification of fixtures, furniture and equipment (FF&E) to be installed, if applicable.

6.1.2 CFZ may request a Change Order in writing to ESTABLISHMENT , in the form attached hereto as Schedule Six, “Change Order Request”. Such Change Order Request shall include a description of the required work and technical specification of fixtures, furniture and equipment (FF&E) to be installed, if applicable.

6.2 Modifications to the Master Schedule including extensions that impact the Build-out Substantial Completion may only be made in accordance with the terms of the Contract, and only by means of a Change Order.

6.3 CFZ shall submit to the ESTABLISHMENT Project Manager for his approval all Change Orders, in the form attached hereto as Schedule Six, and including the following information:

6.3.1 Soft cost which shall include, but are not limited to:


(a)	Custom clearance fees;

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(b)	Insurance (costs of premiums for all bonds and insurance permit fees, and sales, use or similar taxes to the extent applicable to the Change Order);


(c)	Permits, temporary installations, quality control, utilities for Build-Out construction, along with printed materials and other equivalent reasonable soft costs actually incurred.

6.3.2 Direct Build-Out Construction cost from Subcontractors which shall include, but not limited to:


(a)	Labor (including social security, old age and unemployment insurance, fringe benefits required by agreement or custom, and workers’ compensation, as well as additional costs of supervision and field office personnel directly attributable to the Changes Order);

(b)

Materials, tools and equipment (including supplies and equipment, cost of transportation thereof and taxes thereon, whether incorporated or consumed, as well as rental costs of machinery and equipment exclusive of hand tools, whether rented from CFZ or others, provided however that (i.a) if such items are rented from CFZ , the rental charges shall not exceed the average amount which would be charged by unrelated third parties engaged in the business of renting such machinery and equipment, for which a sample of three companies may be used; and (i.b) ESTABLISHMENT shall only be charged for the period of rental during which the equipment has been used in the construction activity, which shall include the times of activity, support and stand by times;


(c)	Consumables, subcontracts, FF&E, fleets, and contingencies;

6.3.3 Each Change Order shall include CFZ’s Build-Out Construction Management Fee of thirteen percent (13%) of the total Cost of Work incorporated in the Change Order pursuant to Article 6.1.2 or 6.3.2.

6.3.4 CFZ Hourly Services . As an exception to sections 6.3.2 and 6.3.3 above, CFZ will perform the following services subject to a Change Order, and CFZ will charge an hourly service fee to be quoted in advance, which will not include Build-Out Construction Management Fee, nor the costs established in such sections:

a) Changes to the Final Drawings, Schematic Designs and Scope Manual, requested by ESTABLISHMENT after they have been approved by ESTABLISHMENT , in all design portions, unless these changes are corrections on failures of the Designs. The Works portion of this Change Order will be charged as established in Articles 6.3.1 to 6.3.3 above.

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b) Changes to Build-Out Pre Construction Stage Deliverables after they have been delivered. including when changes are required due to subdivision of the Work in phases. The Construction Works portion of this Change Order will be charged as established in Articles 6.3.1 to 6.3.3 above.

6.3.5 Time of completion and its impact, if applicable, on the overall Master Schedule, in case the Change Order affects the critical path of the Project.

6.3.6 Change Order Payment Schedule: Change Orders will be paid by ESTABLISHMENT in accordance with the terms of the applicable Change Order and otherwise in accordance with the payment provisions of the Contract. There shall be no retentions to any Change Order.

6.4 Change Orders for Work to be performed by Subcontractors with a total price of Fifty Thousand dollars (US$50,000.00) or more, shall be based on offers from at least three bids, unless otherwise authorized by ESTABLISHMENT , after having performed an appropriate bidding process as per Article 4 herein. ESTABLISHMENT shall authorize one of the three offers, unless ESTABLISHMENT has a reasonable objection in which case ESTABLISHMENT can direct CFZ to seek new bids; in which case any resulting delay due to ESTABLISHMENT instructions will be contemplated in the Master Schedule. Change Orders for Work with a total cost inferior to Fifty Thousand dollars (US$50,000.00) do not require a bidding process however they do require a third party firm offer.

6.5 ESTABLISHMENT agrees, that the final cost of the Change Order once performed, may be higher than the budgeted cost in a maximum amount of five per cent (5%) of the original budgeted cost; as a result ESTABLISHMENT agrees to pay the difference between the budgeted amount and real cost as long as such cost difference does not surpass five per cent (5%)

6.6 ESTABLISHMENT will have three (3) working days to accept or reject in written the Change Order proposal given by CFZ . CFZ will only perform Change Orders with ESTABLISHMENT written confirmation and acceptance from ESTABLISHMENT Project Manager. However if ESTABLISHMENT does not respond by accepting or denying a Change Order, or if ESTABLISHMENT denies such Change Order, CFZ shall continue with the Work as intended as per the Build-Out Construction Documents.

6.7 All Work shall be made in compliance with the Condominium by-laws, park regulations, and construction codes effective in Costa Rica, and all applicable legal requirements.

6.8 On the Final Completion of the Project or earlier termination of this Contract, CFZ shall transfer all original documents related with the performance of the Work and the Project to ESTABLISHMENT (if applicable), as well as copies of all original invoices and contracts used for performing the Work, and all alterations, additions or deduction thereto CFZ the original invoices and contracts, for a period of five (5) years after said Work is performed if applicable.

6.9 Changes to the Final Drawings, Schematic Designs and Scope Manual, requested by ESTABLISHMENT after they have been approved by ESTABLISHMENT , will also be performed

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subject to a Change Order, however, in these cases, CFZ will charge an hourly fee (based on attached hourly fees) for the services in the design portion of the Change Order to be quoted in advance. The Works portion of the Change Order will be charged as established above.

ARTICLE 7 WORK CLOSE OUT— HAND OVER DATE

7.1 CFZ shall deliver the Project when it is “substantially completed”, as established in the Project Master Schedule under Schedule Four, in accordance with the requirements of this Contract (except any Punch List items), the Scope Manual and the Building Layout provided by ESTABLISHMENT and as of the Final Engineering Drawings provided by CFZ and approved by ESTABLISHMENT (such date, the “Hand Over Date”). “Build-out Substantial Completion” shall be defined as the point at which CFZ has completed each part of the Project at least ninety five percent (95%) completion so long as the Facility is ready for its intended use at full capacity, subject to any part of the Work that is not required to be completed as part of Build-out Substantial Completion pursuant to a Change Order that has been mutually agreed to be executed thereafter due to build-out or operations schedule requirements.

7.2 CFZ shall deliver the Facility to ESTABLISHMENT in a clean and proper state, free of any waste, and any other left over material, and ready for ESTABLISHMENT’s separate tool and equipment installation.

7.3 At the Hand Over Date, ESTABLISHMENT Project Manager and CFZ Project Manager shall inspect the Building and review the Build Out Acceptance Report which shall include a list which sets forth any pending Work, (hereinafter the “Build-out Punch List”) as well as the timing of their final delivery, as deemed appropriate. In case of acceptance, ESTABLISHMENT Project Manager and CFZ Project Manager shall sign the Acceptance Note included in the report and CFZ will provide an invoice of all amounts owed to CFZ for payment within the following thirty (30) calendar days. In case of dispute regarding Build-out Substantial Completion, parties will have to solve such dispute, as indicated in Section 18. The Build-out Acceptance Report will be submitted to ESTABLISHMENT by CFZ for its acceptance on the date of inspection.

7.4 The Hand-Over date shall be the date on which all warranty periods commence and the date on which all risks pass from CFZ to ESTABLISHMENT .

7.5 Within thirty (30) days after the Hand-Over Date, CFZ shall complete the Build-out Punch List (unless any such items were explicitly agreed to be completed within a shorter or longer period), supply ESTABLISHMENT with a set of documents related to the Building, including As Built plans, a confirmed list of all Subcontractors, design calculations, all operational documents and manuals of all equipment installed, as provided by vendors. Upon the satisfaction of the foregoing, the Project shall be deemed to have achieved “Final Completion”, and CFZ will provide an invoice of all amounts owed to CFZ (including Retentions if any), for payment within the following thirty (30) calendar days. CFZ shall also deliver any remaining undelivered formal contract termination (in the form attached as Schedule Seven (the “Subcontractors Termination”) from all subcontractors that have performed work related to the Project.

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7.6 Turnover: CFZ will organize and direct the education of the Facility’s personnel in the operation and maintenance of the new Facility. CFZ will also assist the facilities personnel in evaluating systems performance in the critical break-in periods where required. Turnover obligations shall not interfere with Work Close Out however CFZ shall cooperate with ESTABLISHMENT as required.

7.7 If the Build-out Substantial Completion does not take place as required in the Master Schedule (as duly changed), CFZ shall pay to ESTABLISHMENT as liquidated damages a fixed and sole compensation for damages or losses due to delay, an amount equal to zero point zero fifteen per cent (0.015%) of the unpaid amount to CFZ of CFZ fees for every additional day of delay for the first seven days of delay; if such delay continues starting on the 8 ^th day of delay, CFZ shall pay an additional zero point zero twenty five percent (0,025%) of the unpaid amount to CFZ of CFZ fees for every additional day of delay for next seven days of delay, if such delay continues starting on the 15 ^th day of delay, CFZ shall pay an additional zero point zero four percent (0,4%) of the unpaid amount to CFZ of CFZ fees for every additional day of delay until de Substantial Completion date.. Additionally, ESTABLISHMENT shall be entitled to all economic fines that CFZ might recover from all subcontractors due to a subcontractor delay as per the corresponding contract; CFZ shall not be held accountable for any fine not recovered from a subcontractor. The maximum damages for any claims under this Contract, whether caused by CFZ or any Subcontractor shall be limited to the amount of two hundred thousand dollars (US$200.000,00). CFZ acknowledges and agrees that CFZ’s sole compensation and remedy for any ESTABLISHMENT Delays shall be repayment of direct costs as agreed to by the Parties pursuant to a Change Order in accordance with the Change Order procedures contained in this Contract. The Parties warrant and acknowledge that they will not file any lawsuits or claims to recover additional amounts from the delaying Party due to delays. In no event shall either party be responsible to the other for consequential damages or loss of profit.

7.8 If failure to achieve the Work Close Out continues for more than the one hundred (100) days of the date specified in the Master Schedule provided above, for reasons other than a ESTABLISHMENT Delay, ESTABLISHMENT shall have, at ESTABLISHMENT discretion, the additional right to give CFZ a written notice that it intends to deem the agreement terminated, as per Section 15.3 below.

ARTICLE 8 TRANSFER OF GOODS

8.1 Within eight weeks after Work Close Out or any termination of this contract as detailed herein, CFZ shall prepare a final statement of all transactions processed, and will transfer to ESTABLISHMENT through proper customs forms, the transactions and the possession of any equipment and works processed under this Contract, if required. Free Trade Zone beneficiary status of ESTABLISHMENT shall be ESTABLISHMENT’s responsibility.

ARTICLE 9 ESTABLISHMENT RESPONSIBILITIES

9.1 ESTABLISHMENT shall provide all requested relevant Project information to CFZ in a timely manner, including the Scope Manual and Final Layout.

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9.2 ESTABLISHMENT shall provide full information regarding requirements for the Project, including a program which shall set forth ESTABLISHMENT objectives, schedule, constraints and criteria, including space requirements and relationships, flexibility, expandability, special equipment, systems, and site requirements.

9.3 All communications with the Subcontractors go through CFZ . However, if it becomes necessary for ESTABLISHMENT to communicate directly with a Subcontractor, ESTABLISHMENT shall notify CFZ in writing of the content of such communication.

9.4 ESTABLISHMENT shall promptly furnish all requested review and approval or other appropriate action with respect to all submittals by CFZ including, without limitation, any samples, estimates, schedules, budgets, shop drawings, construction Subcontracts, bid awards, Change Orders, purchase orders contracts and other items submitted and/or proposed by CFZ . Failure by ESTABLISHMENT may result in an adjustment to the Master Schedule and Contract Sum; provided, however, any such extensions or adjustments are only applicable if documented pursuant to a Change Order as provided herein.

9.5 Payment to CFZ in accordance to all Payment Schedules required for the Project subject to CFZ ’s satisfaction of the Payment Application provisions set forth herein. CFZ reserves its right to cover ESTABLISHMENT unpaid invoices with the Bank Guarantee as per this Contract.

ARTICLE 10 OWNERSHIP AND USE OF DRAWINGS , SPECIFICATIONS AND OTHER DOCUMENTS

10.1 The drawings, specifications and other documents prepared by CFZ , or any Subcontractors, are instruments of the creator of such documents, through which the Work to be executed is described. CFZ may retain one record set, and shall request a second set and an AUTOCAD copy to provide to ESTABLISHMENT . CFZ should provide structural, mechanical, electrical and other necessary calculations and memoirs used to the design estimations. ESTABLISHMENT shall not own or claim a copyright in the drawings, specifications and other documents prepared by CFZ , or others, and unless otherwise indicated the corresponding creator shall be deemed the author of them and will retain all statutory and other reserved rights, in addition to the copyright. The drawings, specifications and other documents prepared by CFZ , or the contractors, and copies thereof furnished to ESTABLISHMENT , are for use solely with respect to this Project and any repairs, modifications, expansions of the Building or other uses reasonably necessary by ESTABLISHMENT to beneficially use and occupy the Building (collectively, the “Permitted Uses”). ESTABLISHMENT is granted an irrevocable, limited license to use and reproduce the drawings, specifications and other documents, appropriate to and for the performance of the Work exclusively, therefore ESTABLISHMENT may not use this documents for other projects in Costa Rica. The owner of such documents in turn, will not be allowed to use these documents for other projects in Costa Rica, unless authorized by ESTABLISHMENT for its expansion in the Park. Nonetheless, CFZ will use any information provided by ESTABLISHMENT for the development of the Project as confidential and will not own or claim a copyright over such information as used solely for the Project.

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ARTICLE 11 CONTRACT SUM AND CFZ’S COMPENSATION

11.1 Contract Sum: ESTABLISHMENT intends to hire CFZ on a cost-plus basis whereby CFZ shall perform or cause to be performed the Work for the Cost of Work plus the Build-Out Construction Management Fee and Reimbursable Costs.

As Subcontracts are awarded and the value of the overall budget re-affirmed and accepted by ESTABLISHMENT , the aggregate sum of the approved Subcontract prices, all of which shall be based on a fixed price or guaranteed maximum price basis (collectively, the “Cost of Work”), together with the Build-Out Construction Management Fee and any approved Reimbursable Expenses shall be deemed the “Contract Sum”. It is understood that if and to the extent not all of the trades are bid and awarded at the same time, the Contract Sum shall be increased by Change Order to reflect the acceptance of additional bids as approved by ESTABLISHMENT .

Construction Management Fee: Compensation by ESTABLISHMENT to CFZ for performance of the Services under the Contract shall be of thirteen per cent (13%) of the Contract Sum and such percentage shall be applied to every Project invoice charged to ESTABLISHMENT , as per the Payment Application procedure and the payment schedule included within the Cash Flow.

As per Article Section 6, each Change Order shall include a Change Order Direct Cost plus its Build-Out Construction Management Fee, as well as the corresponding Payment Schedule for such Change Order.

11.2 Services to be provided by CFZ included in the Build-Out Construction Management Fee shall be all those included herein.

11.3 Significant scope variations to the Scope Manual provided to CFZ such as the addition of another phase may result in a modification (an increase or decrease, as appropriate) to the Build-Out Construction Management Fee if mutually agreed pursuant to a Change Order.

11.4 CFZ shall not perform any Additional Services, nor make any addition to or deletion from the Scope Manual except by written Change Order signed by ESTABLISHMENT Project Manager.

ARTICLE 12

If and to the extent that the Term is extended or Build-Out Construction Management Fee is adjusted, the balance of monthly installments of the Build-Out Construction Management Fee shall be recalculated to reflect the extended Master Schedule and any adjustment in the Build-Out Construction Management Fee. Such recalculation shall result in monthly installments of the Build-Out Construction Management Fee that each are an amount equal to the unpaid balance of the Build-Out Construction Management Fee divided by the total number of months remaining in the Term for which an invoice has not been properly submitted by CFZ. Partial months shall be treated as full months for purposes of recalculating the monthly installments of the Build-Out Construction Management Fee. REIMBURSABLE COSTS

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12.1 Pursuant to Article 11 herein, the Build-Out Construction Management Fee payable to CFZ shall comprise the entirety of the CFZ’s compensation for the Services. Notwithstanding the foregoing, if CFZ is required to perform services not identified or reasonably contemplated within the scope of Services identified in this Contract and such additional services require CFZ to incur additional costs associated with the Project, CFZ shall request to ESTABLISHMENT in writing, approval to incur into a reimbursable cost “Reimbursable Cost Request”, and shall include in the request the calculation of the expense in reasonable detail. If CFZ does not receive a written objection from ESTABLISHMENT regarding the Reimbursement Cost Request within three (3) days from ESTABLISHMENT receipt of the Reimbursement Cost Request, CFZ shall be authorized to deem the costs included in the Reimbursable Cost Request as an Authorized Reimbursable Cost. Utilities required to perform the Works within the premises, such as water, electricity, and similar, shall be considered an authorized Reimbursable Cost and shall be paid by ESTABLISHMENT accordingly.

12.2 Authorized Reimbursable Costs shall be paid to CFZ in the following month in which CFZ incurs into such Authorized Reimbursable Costs and shall be included in the monthly Payment Applications.

12.3 Reimbursable Costs agreed upon pursuant to Article 12.1 hereof are in addition to compensation for Services and Additional Services and include expenses incurred by CFZ and its employees and consultants in direct interest of the Project.

12.4 Permits are deemed Reimbursable Costs, and are deemed approved. CFZ will apply for such permits in accordance with the Free Trade Zone benefits when applicable; if such benefits are not applied due to causes attributable to CFZ , the amounts to be paid shall not be considered Reimbursable Costs.

ARTICLE 13 PAYMENTS TO CFZ

13.1 All payment of the Contract Sum shall be paid in accordance with a Payment Application as per Articles 5.4.3. and 5.4.4 above,

13.2 CFZ shall also include a monthly invoice including the Build-Out Construction Management Fee then due, as well as the total Authorized Reimbursable Costs incurred during such term, with attached supporting documentation.

13.3 Any payments pending and amounts due to CFZ shall be made by ESTABLISHMENT to CFZ within ten (10) calendar days after the date of receipt of the invoice approved by ESTABLISHMENT in accordance with the Payment Applications provisions set forth in Section 5.4. Any delay beyond the aforementioned thirty (30) day period shall generate interest at an annual interest of 8.5% percentage points (calculated in a year of twelve months, and each month of 30 days), and a breach is deemed to have occurred by ESTABLISHMENT . Prompt payment is absolutely necessary.

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13.4 ESTABLISHMENT will hold five Percent (5%) retainage on all payments associated with the Contract Sum (“Retention”) and will hold such Retention until the Hand Over Date, unless ZFC has delivered a letter of credit issued by a bank of the Costa Rican National Banking System on behalf of ZFC , naming ESTABLISHMENT as beneficiary. Within five (5) calendar days after the Hand Over Date, CFZ shall carry out the final billing for the entire project by issuing the final invoice, deducting any advance payments as well as partial invoiced amounts, for which it will attach a note. Retainage will not be applied to any Reimbursable costs as per this contract.

ARTICLE 14 INDEMNIFICATION

In accordance with article 1045 of the Civil Code, each Party (the “Breaching Party”) agrees to indemnify and hold harmless the other Party from any loss (including reasonable attorneys fees and other out of pocket costs), damage or liability attributable to or derived from a breach of this Agreement by the Breaching Party, provided, however, that claims covered by Article 7.7 or Article 12 of this Agreement shall be resolved solely in accordance with the provisions and limitations contained in those articles, and provided further that neither Party shall be responsible to the other for any consequential damages or lost or anticipated profits, even if an authorized representative of such party is advised of the possibility or likelihood of same.

CFZ , to the fullest extent permitted by law, shall indemnify, hold harmless and defend ESTABLISHMENT , its officers, directors, employees and agents from and against claims, losses, damages, liabilities, including attorney’s fees and expenses, for bodily injury, sickness or death and property damage or destruction (other than to the Work itself) to the extent resulting from the negligent acts or omissions of CFZ , Sub Consultants, Subcontractors, or anyone employed directly or indirectly by any of them or anyone for whose acts any of them may be liable.

If an employee of CFZ , Design Consultants, Subcontractors, anyone employed directly or indirectly by any of them or anyone for whose acts any of them may be liable has a claim against ESTABLISHMENT , its officers, directors, employees or agents, CFZ’s indemnity obligation shall not be limited by any limitation on the amount of damages, compensation or benefits payable by or for CFZ , Sub Consultants, Subcontractors or other entity under any employee benefit including worker’s compensation or disability.

In no event shall either party be responsible to the other for consequential damages or loss of profit.

ESTABLISHMENT , to the fullest extent permitted by law, shall indemnify, hold harmless and defend CFZ and any of CFZ ’s officers, directors, employees or agents from and against claims, losses, damages, liabilities including attorney’s fees and expenses, for bodily injury, sickness or death and property damage or destruction (other than to the Work itself) to the extent resulting from the negligent acts or omissions of ESTABLISHMENT its officers, directors, employees or agents.

ARTICLE 15 TERM AND TERMINATION

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15.1 This Contract shall become effective upon the date of signature by both Parties and first payment required by ESTABLISHMENT to CFZ is fully credited under CFZ bank account (hereinafter the “Effective Date”), however the Build-Out Design and Construction term within the Master Schedule will only begin upon ESTABLISHMENT written notice to CFZ that all precedent conditions have been completed, including but not limited to approval of government and municipal permits, Initial Estimate Budget, the Scope Manual and the Construction Layout. Contract Term is estimated at 11 months (from the execution of this Agreement until Substantial Completion) based on the preliminary master schedule; once parties define the final master schedule the substantial completion date shall be adjusted accordingly within the final master schedule. Any delay on behalf of ESTABLISHMENT regarding master schedule milestones, shall be considered an ESTABLISHMENT delay and CFZ shall be entitled to delay the project on the same amount of days as the ESTABLISHMENT delay.

15.2 Either Party shall have the right to terminate this Contract with immediate effect in the event of a Substantial Breach, as hereinafter defined, of this Contract by the other Party.

15.3 A “Substantial Breach” by CFZ entitling ESTABLISHMENT to terminate with immediate effect shall be deemed to have occurred if:


(a)	bankruptcy or similar proceedings are instigated (voluntarily or involuntarily) against CFZ’s assets or CFZ;


(b)	if failure to deliver the Work, due to CFZ’s fault, exceeds one hundred (100) days of delay pursuant to Article 7.7;


(c)	CFZ interrupts its work without a legal cause or as otherwise permitted under this Contract, and does not resume within fifteen (15) days after written demand by ESTABLISHMENT ; or


(d)	Any other material breach of this Contract by CFZ which is not cured by \ CFZ within thirty (30) days after CFZ received of written notice by of the existence of the material breach ESTABLISHMENT .

Upon such termination, ESTABLISHMENT may take possession of the site and complete the Work utilizing any reasonable means. In this event, ESTABLISHMENT shall be obligated to pay CFZ for all Services and Work properly performed or committed (including all reimbursable and additional costs) through the date of termination. CFZ shall assign to ESTABLISHMENT , its rights under any or all subcontracts for the Work and/or all rights it may have against all Subcontractors related to warranties and guaranties provided on the Work.

Parties accept and acknowledge that ESTABLISHMENT will not terminate this agreement, and will hold CFZ harmless, will not file a claim or lawsuit against it, or request a sum for damages or losses, if the default is caused or due to Acts of God and/or Force Majeure. Also that any non

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compliance or delay, due to lack of or delay in obtaining permits that are CFZ ’s responsibility, and that were diligently filed and proactively processed, shall not be considered as a Substantial Breach.

15.4 A “Substantial Breach” by ESTABLISHMENT which entitles CFZ to terminate with immediate effect shall be deemed to have occurred if:


(a)	If ESTABLISHMENT has delayed payment in accordance to approved Payment Applications for a thirty day term; or


(b)	If ESTABLISHMENT unilaterally ordered work stoppage that has carried on for sixty (60) days, or more, however all payments required have been fulfilled.


(c)	If ESTABLISHMENT materially breaches this Contract, and such breach is not cured by ESTABLISHMENT within thirty (30) days after ESTABLISHMENT received written notice by CFZ of the existence of the material breach.

Parties accept and acknowledge that CFZ will not terminate this agreement, and will hold ESTABLISHMENT harmless, will not file a claim or lawsuit against it, or request a sum for damages or losses, if the default is caused or due to Acts of God and/or Force Majeure.

15.5 Upon termination by CFZ in accordance with Article15.4, ESTABLISHMENT shall be obligated to pay CFZ :


(a)	The 25% of Build-Out Construction Management Fee that CFZ would have been entitled to if the Construction Management Agreement had been completed.


(b)	All costs of Work performed by Subcontractors plus and reasonable termination costs under such Subcontracts;


(c)	All reasonable demobilization costs; and


(d)	Fair compensation for any materials, equipment, or other property retained by ESTABLISHMENT .

15.6 As a condition of receiving the payments described in the this section, CFZ shall cooperate with ESTABLISHMENT by taking all steps necessary to accomplish the legal assignment of CFZ’s rights and benefits to ESTABLISHMENT , including the execution and delivery of reasonably required documents.

15.7 Any notice for termination must be in writing, and delivered to the other Party. Such notice must be preceded by written indication of shortcomings and provisions of adequate deadlines (and in no event less than five (5) business days) for correcting the same.

15.8 Within fifteen (15) calendar days after termination of this Contract, CFZ shall deliver to ESTABLISHMENT all relevant materials, supplies and equipment paid for by

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ESTABLISHMENT and the Contract Documents in accordance with other provisions of this Contract.

15.9 The remedies provided in this Section 15 are all remedies applicable to the Contract, and neither Party shall be responsible to the other for any consequential damages or lost or anticipated profits, arising out of or relating to this Contract, even if an authorized representative of such party is advised of the possibility or likelihood of same, and Parties warrant and acknowledge that they will not file any lawsuits or claims to recover additional amounts from the defaulting Party other than as set forth herein.

15.10 ESTABLISHMENT Guarantee . ESTABLISHMENT shall, at the time of the execution of the CMA Agreement deliver to CFZ a Performance Bond equivalent to the amount of Seven Hundred and Fifty Thousand dollars (US$750.000,00) valid until April 30 ^th 2016. The amount of the performance bond shall be revised at least every two months in order to adjust it to the remaining amount of CFZ unpaid fees, all Performance Bonds shall be renewed at least fifteen days prior to the expiration date of the current Performance Bond . All Performance Bonds shall be emitted by a bank legally established in Costa Rica and such performance bond shall be approved by CFZ . ESTABLISHMENT Guarantee shall secure ESTABLISHMENT ’s obligations and payment of any amounts due from ESTABLISHMENT to CFZ under this Contract from the time of execution and until three months after the Final Completion of this Contract. In case the Initial Estimated Budget or the final budget exceeds in more than 20% (twenty percent) the amount of the Contract Price such confirmation shall be adjusted accordingly.

15.11

15.12 Parties agree that if ESTABLISHMENT fails to make any payment to ZFC, ZFC will be entitled to execute the Performance Bond at its sole discretion.

ARTICLE 16 WARRANTY

16.1 CFZ warrants that it will perform the Work in accordance with the highest standard of care normally practiced by firms that possess (i) expertise and experience in performing services of a similar nature at the time and place the Services are performed, and (ii) extensive familiarity with the site upon which the Project is located and surrounding areas, and with the conditions under which the Work is to be performed (the “Standard of Care”). Without limiting the foregoing, CFZ is responsible for any defect in construction or the Work for a period of five years following Final Completion, whether performed by CFZ or any subcontractor of any tier. The foregoing warranty is and shall be separate and independent from any separate manufacturer’s warranty with respect to any materials or equipment. The obligations contained in this Article 16 are CFZ’s sole warranty obligations with respect to the performance of the Work. CFZ makes no warranties relating to schedules or completion dates, budgets, the cost of the Work or the Project, the Work performed by the Subcontractors, or any other warranties, express or implied, which are not expressly set forth herein. CFZ shall have no liability for any defects in CFZ’s Services directly attributable to CFZ’s good faith use and reliance upon any Build-Out Construction Documents furnished by ESTABLISHMENT , where such Build-Out Construction Documents provided by

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ESTABLISHMENT were the direct cause of such defects, or such other information furnished by or on behalf of ESTABLISHMENT , where such other information furnished by ESTABLISHMENT was the direct cause of such defects.

16.2 Each design professional or Subcontractor is responsible for any defect in construction or the Work for a period of five years following Final Completion of the Project. The foregoing warranty is and shall be separate and independent from any separate manufacturer’s warranty with respect to any materials or equipment. CFZ and each applicable subcontractor shall take all steps necessary to ensure that the Work is performed in a manner that does not violate any such manufacturer’s warranty. CFZ will cooperate with ESTABLISHMENT in any actions taken to claim such statutory warranty. Liability shall not be applicable for the defects or damages caused by ESTABLISHMENT or due to ESTABLISHMENT fault.

16.3 The warranty does not apply to defects caused by normal wear and tear or the improper use of the finished Work in a manner for which it was not reasonably designed, intentional damage or Force Majeure.

ARTICLE 17 INSURANCE

Insurance policies, coverage and conditions will be subscribed and maintained by CFZ and ESTABLISHMENT in accordance with Schedule Nine, and proof of the validity of those insurances can be requested at any time.

ARTICLE 18 MISCELLANEOUS

18.1 Any notice or written documents shall be delivered in person, with delivery acknowledged in writing, or by recognized international courier, with evidence of delivery provided and such delivery constituting the date of notice.


(a)	To CFZ: At Administrative Building Coyol Free Zone, Fax Number: (506) 2435-6060, to the attention of Mr. Carlos Wong, with a copy to Federico Castro ________________.


(k)	To ESTABLISHMENT Name: B15 Coyol Free Zone

Fax: (506) 2434-2400

Email: ________________

18.2 Any modifications to this Contract must be in writing and must be signed by both Parties.

18.3 The Parties recognize that differences sometimes arise in the course of a relationship and wish to avoid litigation. Accordingly, all claims, disputes and other matters in question between CFZ and ESTABLISHMENT arising out of or relating to this Agreement or the breach thereof, the Project, or the Work (“disputes”) shall first be submitted to negotiation and may, failing resolution, then be subject to arbitration as set forth below; however, in all other cases, all legal and equitable rights and remedies provided at law and equity are reserved. Disputes claimed by either party must

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be made by written notice. Pending final resolution of any dispute, including arbitration in accordance with this Section, CFZ shall proceed diligently with performance of the Work to the extent it is unrelated to the dispute and the subject matter of the dispute does not inhibit the progress of the Work generally, and ESTABLISHMENT shall continue to make payments to CFZ in accordance with this Agreement to the extent unrelated to the dispute. To the extent necessary in light of the circumstances, the Contract Term shall be extended by the period of time necessary to resolve any dispute. Such performance by CFZ and payment by ESTABLISHMENT shall not operate to waive or stop either party from pursuing the claim which gave rise to the dispute. If any dispute arises, ESTABLISHMENT and CFZ shall each appoint an executive officer to meet for the purpose of resolving it. If the parties’ executive officers are able to reach an agreement, the dispute will be deemed resolved.

18.4 If after fifteen (15) days from the date the dispute arose these negotiations prove unsuccessful in whole or in part , any and all disputes, claims, differences, disputes or controversies arising out of or in relation to any aspect of this Agreement, its business matter, performance, liquidation, interpretation, validity or any breach thereof, shall be resolved by arbitration in accordance with the bylaws of the International Center for Conciliation and Arbitration of the Costa Rican-American Chamber of Commerce (“CICA”). The parties hereby agree to submit voluntarily and unconditionally to its rules and bylaws and claim knowledge thereof. Disputes shall be resolved by an Arbitration Tribunal composed of three arbitrators; each party shall appoint one arbitrator, and these two arbitrators shall appoint a third arbitrator who will act as president of the Arbitration Tribunal. The Parties hereby agree, that they cannot assign their rights and obligations under this Contract totally or partially without mutual approval however ESTABLISHMENT may assign its rights and delegate its duties hereunder to any entity which is controlled by or under the common control of ESTABLISHMENT , its ultimate parent or any of its affiliates and CFZ may assign its right to compensation under this agreement, for financing purposes. The Guarantee shall survive any such assignment, and remain valid.

18.5 This Contract represents the entire arrangement between the parties concerning the subject matter hereof, and supersedes all written or oral concurrent or prior agreements or understandings with respect thereto. Neither party may claim any amendment, modification or release from any provision hereof by mutual agreement, acknowledgment or acceptance of a purchase order form or otherwise, unless made in writing and signed by authorized representative of both parties. Any conflict between the terms and conditions noted on the Contractor’s proposal and this Contract shall be governed by this Contract.

18.6 In the event that any provision of this Contract is found to be unenforceable under law, the remaining provisions shall continue in full force and effect.

18.7 This Contract shall be governed and the rights and duties created hereunder shall be interpreted and enforced according to the laws of the Republic of Costa Rica, regardless of the domicile of the Parties or the location of the Project.

18.8 This Contract has been made in 2 original copies in English language of which each of the Parties shall receive 1 copy each.

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18.9 The Schedules identified in this Contract are incorporated herein by reference and are an integral part thereof.

18.10 Due to the nature of this Contract, the value for fiscal purposes cannot be estimated.

18.11 Either Party can appear before a Notary Public to file with the original copies kept by a Notary, without the presence of the other Party, at its own cost.

18.12 Confidentiality: Each of CFZ and ESTABLISHMENT shall keep in confidence all drawings, records, data, books, reports, documents and information, whether technical, commercial or financial in nature, supplied to it by or on behalf of the other party relating to the Project and the Works and shall not disclose the same in any manner otherwise than for the purpose of seeking financial assistance for the Works or for the purpose of performing its obligations hereunder, or as it may necessarily be required to disclose pursuant to the laws or orders of appropriate regulatory authorities or pursuant to any financing to the Project or any other agreement by which it may be bound; provided that nothing in this clause shall limit the parties’ right to use such documents and information in circumstances where the Contract has been terminated.

IN WITNESS WHEREOF , the parties hereto have caused this Contract to be signed by their duly authorized agent(s) the day and year first above written.



/s/ Juan Jose Chacón
Name: Juan Jose Chacón
Date and Place:	San Jose, February 11, 2016
By: Establishment Labs S.A.
Tenant



/s/ Álvaro Carballo Pinto			/s/ André Garnier Kruse
Álvaro Carballo Pinto			André Garnier Kruse
Date and Place:			Date and Place:
By/Zona Franca Coyol, S.A.

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Schedules

Schedule One
Notarial Statements
a) ESTABLISHMENT
b) CFZ

Schedule Two
Location Plan

Schedule Three

Bill of Exchange Guarantee

Schedule Four

Preliminary Master Schedule

Schedule Five
Change Notice

Schedule Six
Form of Change Order

Schedule Seven

Subcontractor’s Termination Form

Schedule Eight
Scope Manual

Schedule Nine
Insurance Description

Schedule Ten
Preliminary Budget

Schedule Eleven
Budget Cash Flow

Exhibit 10.15

LEASE AGREEMENT

Entered into at the city of San José, on the 7 ^th day of the month of August of the year 2015, the "Effective Date" between:

ZONA FRANCA COYOL, S. A. , corporate identification card number three- one hundred one-four hundred and twenty thousand five hundred twelve, (the "Landlord"), registered in the Mercantile Section of the Public Registry under book five hundred sixty, entry ten thousand three hundred and seventy nine, consecutive one, hereon represented by Álvaro Carballo Pinto, personal identity card number one - five hundred and thirty six - six hundred and fifty five, and Huber André Garnier Kruse, personal identity card number one- four hundred sixteen- one thousand three hundred forty four, and, acting jointly and with sufficient authority for the execution of this lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book five hundred and sixty five, entry eleven thousand five hundred and ninety two, consecutive one, as certified in Exhibit One.

for the one part and for the other,

Establishments Labs, S.A. , corporate identification card number three- one hundred one- three hundred and sixty nine thousand three hundred and thirty seven (the "Tenant"), registered in the Mercantile Section of the Public Registry under book five hundred seventy four, entry sixty six thousand three hundred and seventy nine, consecutive one, hereon represented by Juan José Chacón, with personal identity card number one – eight hundred twenty two- cero cero six, with sufficient authority for the execution of this lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book two thousand and nine, entry two hundred twenty six thousand seven hundred and forty eight, consecutive one, as certified in Exhibit One.

Whereas

1. Landlord is the registered owner of a property (the "Property"), located in the "Condominio Horizontal Industrial Comercial con Fincas Filiales Primarias Individualizadas (FFPI) Zona Franca Coyol" (the "Condominium" or "Zona Franca Coyol"), condominium identity number 3‑109- 533883, a condominium registered in the Costa Rican Public Registry, Province of Alajuela, Property Number M‑2640- 000, filial lot number twenty six (26), hereinafter the "Property", registered in the Public Registry Property of Alajuela, Property Number 68517- F- 000.

2. The Condominio Horizontal Industrial Comercial con Fincas Filiales Primarias Individualizadas (FFPI) Zona Franca Coyol, "Zona Franca Coyol", is a Free Trade Zone. The Condominium and Park Administrator is the Landlord, or any other dully appointed as its replacement.

3. Landlord will facilitate a manufacturing cold shell building ready for delivery on the Property in Zona Franca Coyol no later than November 30 ^th 2015, known as Multitenant twenty-six

26, and it shall lease to the Tenant the Premises, as described below. Such delivery shall be effective if lease agreement is executed no later than August 7 ^th , 2015; if lease agreement execution date is delayed, then final delivery date will be delayed on the same amount of days.

4. Tenant shall have the following purchase options from the effective delivery date of the premises of this Lease Agreement in which to decide if it will execute such options under the following conditions:


i)	Purchase Option No.1: Valid only during month twelve (12) of the "Lease Agreement" under the following conditions:


•	Fixed amount equivalent to US$3,495,000.00


•	Fixed price amount of US$3,495,000.00 already includes a credit equivalent to US$112,000.00 regarding ground works performed at Lot 11, and a credit equivalent to US$118,000.00 regarding 12-month lease payment.


ii)	Purchase Option No. 2: Valid only between day one (1) of month thirteen (13) and last day of month twenty four (24) of the Lease Agreement under the following conditions:


•	Alternative A): "Price Match" offer in case of a third party buyer (investment fund or similar) is interested in property, Landlord grants the opportunity for Tenant to match de price offer.


•	Alternative B): If no formal interest is shown from third party buyer (investment fund or similar) to buy the property from Landlord, then Landlord grants Tenant the option to purchase the property under the following scheme: the total sum equivalent to the following twelve months of rent divided between an 8% cap. rate.


iii)	Tenant acknowledges and agrees that in order to execute any purchase agreement of the premises, Landlord must constitute a sub-condominium, which requires at least eight months for approval from governmental and municipal authorities. As a result any purchase notice shall be communicated to Landlord with at least eight months in advance in order to create the subcondominium.


iv)	All legal fees and transfer taxes related to property transfer will be paid on equal parts by both parties, nonetheless, any purchase option execution and/or public deed shall be done through a Public Notary defined by Landlord. The Notary Public may be determined by any financial institution procuring the finance for the purchase by Tenant, if they so require.

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Now therefore in consideration of the mutual considerations and promises herein made, and in consideration of the representations, warranties, and covenants herein contained, the Parties have agreed to execute this lease agreement (hereinafter referred to as the "Lease Agreement"):

Section One: Of the Leased Real Estate or Premises


1.00	Leased Real Estate or Premises

Landlord shall deliver and lease to Tenant, no later than November 30 ^th 2015 after Lease Agreement Execution, a Cold Shell Manufacturing Building within Zona Franca Coyol, as shown in Exhibit Two and as described in Exhibit Three, and it shall lease Tenant an area of two thousand five hundred and ninety two (2,592.00) square meters (approximately 27,900.00 square feet), hereinafter the "Premises".

Landlord shall deliver the Premises to Tenant in accordance with the Landlord's "Shell Building Scope of Work" attached hereto as Exhibit Three.


1.01	Permitted Use

The Premises will be used only for the purpose of installation and operation of a manufacturing facility and warehouse for manufacturing, marketing and commercialization of medical devices and related products.

The Tenant shall not alter the stated use of the Premises without the express written authorization of the Landlord. In accordance with the Lease Agreement, Tenant shall at all times comply with all the applicable national, municipal and other governmental regulations in the carrying out and execution of its activities, including without limitation, Health Ministry regulations, Free Zone regime, environmental (i.e. SETENA) and customs regulations. Tenant shall also comply with any Condominium regulations in effect, as attached hereto as Exhibit Four, or any future regulations or resolutions approved in accordance with Condominium by-laws.

Lessee shall not use the Premises for any illegal activities such as, but not limited to: sports-booking or gambling activities, manufacture of arms or parts thereof, or tobacco products. These prohibitions will extend to any and all successors or assigns, as well as any prohibition stated in the Costa Rican Free Zone Regime Law.


1.02	Premises Conditions

Landlord shall deliver the Premises to Tenant on November 30 ^th 2015 upon the Execution of this Lease Agreement, premises delivery is subject to the execution of this Lease Agreement no later than August 7 ^th , 2015. Any delay on the Lease Agreement execution will impact on the same amount of days the delivery of the premises.

Tenant understands and accepts without objections, the contents of Exhibit Three, and hereby acknowledges and accepts that any changes in the scope and contents of Exhibit Three may result in a change in the Date of Delivery as defined in Section 2.02 below. In case of any extension in the

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Date of Delivery caused by Tenant, the Tenant will have to begin to pay Rent on the Rent Commencement Date as established in Section 2.00.


1.03	Tenant Construction and/or Improvements to the Premises after delivery to Tenant by Landlord.

Tenant may request changes to the Premises, subject to Landlord's written and prior approval, by providing written request to Landlord, hereinafter referred to as the "Change Notice". Landlord shall have ten (10) business days after the receipt of any Change Notice, to approve or reject totally or partially the changes requested, if such changes result in an impact to project budget and/or schedule then parties shall approve new budget and/or schedule in writing.

Tenant may execute the changes directly, in which case, construction permits must be submitted to Landlord before the start of construction works. Also Tenant can request Landlord to execute the works in which case Landlord will provide a change order form including an estimation of the cost and time of delivery of the changes requested by Tenant (Hereinafter referred to as "Change Order"). Costs will be estimated based upon the total direct construction costs of performing the changes, plus an additional fee of thirteen percent (13%). This fee covers only the administrative costs incurred by Landlord, as well as the design, inspection and construction management of the change order scope of work. Tenant will have five (5) business days to accept or reject the proposal given by the Landlord. Costs due to Change Notices, Change Orders and its resulting works shall be paid by in full by Tenant concurrently with the acceptance by Tenant of such Change Order. Any works resulting from an approved Change Order shall be carried out by Landlord or a subcontractor selected by Landlord to carry out the specific changes requested by Tenant through the Change Notice. Landlord shall not perform the changes as per the Change Order, until the Change Order has been accepted by Tenant, in accordance to the terms agreed in such Change Order. The Parties will agree a time schedule for the completion of the Change Order; however delays due to the agreed terms of the Change Order will be considered Tenant's Delay. Changes to the premises made either by Tenant or through a Change Order shall have no impact on the Commencement Date as defined herein or on the term of this Lease Agreement, unless both Parties agree otherwise in writing.

Upon termination due to any cause of this Lease Agreement any works associated to a Change Notice and Change Order shall remain at the Premises; Landlord shall not pay any price nor reimburse any costs associated with the works derived from a Change Notice and a Change Order.

Tenant will be responsible for obtaining the appropriate permits as required by any applicable authority, including without limitation SETENA and PROCOMER, for Tenant's Work (defined as any work performed under Tenant's direct responsibility by its employees or subcontractors). Landlord will cooperate with Tenant diligently in the application of all such construction permits for Tenant's Work. For these purposes, Landlord shall execute all documents and forms and provide informational documents that are required by public authorities from the owner of the Property in order to obtain any arid all required permits. The costs for all permits for Tenant's Work will be Tenant's responsibility.

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1.04	Parking

In addition to any other facility specifically included in this Lease Agreement, the Premises include eighteen (18) parking spaces and one (1) truck dock, located in the perimeter of the Premises, outlined by road demarcations according to the country's and Zona Franca Coyol standards; additional spaces can be rented at the then current monthly rate for parking spaces in Zona Franca Coyol determined by Landlord, and subject to availability. The Tenant will be responsible for assigning as many parking spaces as he deems necessary within the eighteen (18) parking spaces assigned to it, for use by its VISITORS and required by Law 7600.


1.05	Condominium Common areas.

The Tenant can make use of Coyol Free Zone's common areas according to the regulations and specifications included in the Condominium By-laws in its current form, and including any subsequent amendments. The current form of these regulations has been enclosed as an integral part of this Agreement as Exhibit Four, however since all common areas shall be subject to the exclusive management and control of the Landlord, Landlord reserves the right to modify, alter or enlarge common areas, or their use, within the Condominium By-laws, to its sole discretion provided Tenant's rights as per this Lease are not materially affected.


1.06	Special systems, equipment and additional constructions to Premises

Once Building has been delivered to Tenant, Tenant may request at its own expense, the installation of certain special systems and equipment in the Premises in accordance with the Condominium By-laws.

If Tenant decides to carry out any additional works in the Premises, that will not damage or alter the property, it may do so, provided it has submitted to the Landlord before commencing any such activities, all the required construction permits. Landlord will cooperate with Tenant in the application of all such permits. Works in the Premises that will become affixed to it, or change it permanently, or cause damage to it are not accepted, unless Landlord has provided Tenant written consent that cannot be unreasonably denied or withheld and the permits indicated above have been provided. Furthermore, Tenant shall be responsible to cover any costs associated with obtaining such permits, including but not limited to any applicable taxes.

If Tenant wishes to remove any of the additional systems and/or equipment installed in the Premises after the Building has been delivered to Tenant, Tenant shall perform all necessary works, at its own expense and as per Coyol Free Zone instructions and approval, to return the premises to the conditions in which they were received by Tenant as per Exhibit Three. All costs related to Tenant's equipment removal and repair of Premises shall be paid by Tenant.

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Building Automated Fire Protection System will be installed within the premises by Landlord at an additional cost of fifty eight thousand seven hundred and sixty nine dollars with seventy two cents ($58,769.72), which will be paid by Tenant to Landlord under the following to options:

i) Single payment at Rent Commencement Date for the total amount of fifty eight thousand seven hundred and sixty nine dollars with seventy-two cents ($58,769.72).

ii) Landlord will finance the installation of such system at a 10% annual rate for a period of ten years, if Tenant decides to move forward with this option it shall pay a monthly installment equivalent to seven hundred and seventy-seven dollars (US$777.00) during ten years. Payment must be done at the same time as the monthly rent payment. If an anticipated termination of the Lease Agreement on behalf of the Tenant shall occur, then Tenant shall pay to Landlord the outstanding balance at the moment of such anticipated termination.


1.07	Building, Systems and Equipment guarantee

Landlord shall complete the Premises (and any improvements thereto) in accordance with the plans or the description of improvements attached as Exhibit Three, attached hereto. All necessary construction shall be "Substantially Completed," ready for use and occupancy by Tenant, subject to extension for delays due to Force Majure, Acts of God or any other excusable delay as per the terms of this Lease Agreement. Landlord represents and warrants that all construction shall be done in a good and workmanlike manner. The Premises will be as of the date delivered to Tenant in good working order and condition, including without limitation, the Cold Shell Building and plumbing system are brand new, the roof free of leaks and that they have been built and/or installed as per Construction Code, Equipment and Systems Manufacturer instructions and all applicable laws of Costa Rica; as a result the Premises, its systems and equipment are covered by the guarantee terms established in the applicable Costa Rican laws.

The work which Landlord is required to perform shall be deemed "Substantially Completed" or "Substantially Complete" when it has been completed to a degree that no portion thereof remaining incomplete is so material that it would prevent Tenant from occupying the Premises and conducting its business therein (as per contractual building specifications agreed by parties), nor would it prevent the Premises from being lawfully occupied. At the time Landlord's work is Substantially Completed, a representative of Landlord and a representative of Tenant will perform a walk-through inspection of the Premises and will prepare a punch list if one is necessary of minor items remaining to be furnished, repaired or replaced. The representatives of the parties preparing the punch list will both sign the punch list, and Landlord will cause work on all items listed on the punch list to be performed within twenty (20) days after the Rent Commencement Date (as defined in Clause 2.0 below).

Parties have agreed to exclude from "Substantial Completion" scope of work the concrete floor of the Cold Shell Building due to construction strategy; as a result a total of US$104,000.00 will be credited in favor of the Tenant into the Improvements Construction Management Agreement to be executed among parties.

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Section Two: of the Rent and Lease Term


2.00	Rent

The base monthly rent (the 'Rent') payable on the Rent Commencement Date shall be of ten dollars and eighty-five cents (US$10.85), legal tender of the United States of America, per leased square meter, for a total of twenty eight thousand one hundred and twenty three dollars with twenty cents (US$28,123.20). The rent amount is net of any current or future applicable taxes during the term of the lease, any future applicable taxes will be under Tenant's responsibility.

All Rent and other fees indicated herein shall be payable, within the first five (5) days of each month, at the rate indicated herein for the first year of the Lease Term. Starting with the end of the 12 ^th month following the Rent Commencement Date, until expiration of the Lease, any payments to Landlord shall increase by five per cent (5%) from each anniversary of the Rent Commencement Date and until the expiration of this Lease Agreement, using as basis for such increase the amount effective the previous year.

The parties have agreed that Tenant will be exempt of rent payment for the duration of the construction period of the Cold Shell Building. Parties have agreed that the "Rent Commencement Date" will be the date that Landlord delivers and Tenant accepts a "Substantially Completed" Cold Shell Building and Improvements (provided CMA is executed between Tenant and Landlord) to Tenant; all other fees and costs derived from this Lease Agreement shall be paid by Tenant to Landlord taking into consideration the Rent Commencement Date as starting point (i.e. no grace period granted to Tenant).

Furthermore, starting on the Rent Commencement Date, Tenant shall pay the following fees:

a) A monthly service fee of thirty two cents of dollar (US$0.32), legal tender of the United States of America, per leased square meter of construction area for a total monthly service fee of eight hundred twenty nine dollars and forty four cents (US$ 829.44) in accordance with Exhibit Six of this Lease Agreement, as of the Rent Commencement Date, monthly service fee yearly increase shall not exceed five percent (5%).

b) Tenant will also pay all condominium fees, including ordinary and extraordinary fees as provided by the Condominium General Assembly. Current Ordinary Condominium monthly fee has been established at the current rate of US$0.614 per [eased square meter of construction area for a total ordinary monthly fee of one thousand five hundred and ninety one dollars and forty nine cents (US$1,591.49), legal tender of the United States of America. The monthly ordinary fee is subject to changes established by the Condominium Owners General Assembly; Tenant must pay the current-at-the-time ordinary condominium fee established by the Condominium Owners General Assembly and Landlord shall not indemnify Tenant in any form as a result of these increases. If such fee surpasses US$0.614 per leased square meter provided herein, it shall be increased equally.

c) Tenant will also pay any extraordinary condominium monthly fee as provided by the Condominium Owner's General Assembly at the rate established per leased square meter of

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construction area. Tenant must pay any increases in this extraordinary condominium fee established by the Condominium Owners General Assembly and Landlord shall not indemnify Tenant in any form as a result of these increases.

The Condominium fee includes the following services:

i) Free Zone Perimeter security twenty four hours a day, all year round, including a) Access Control, b) Video Cameras at the vehicle and pedestrian access and its related equipment maintenance, and c) Perimeter Security.

ii) Common Area Maintenance – CAM: a) cleaning of streets and Condominium common areas such as bus stops, sidewalks and common parking areas; b) maintenance of common gardens and green common areas (includes water fees only for these areas); c) Maintenance of original building's landscaping and green areas (any modifications or special requirements must be paid by the Tenant); d) access to wastewater treatment plant usage as per Wastewater Treatment Plant Usage Regulations (Exhibit Five); e) maintenance of sewer, potable and storm water pipes; f) general maintenance of infrastructure (sewer system, fiber optics and potable water system); h) Coordination service for exclusive bus transportation for the employees of the park.

The Condominium fee does not include the following services:

i) Any costs of utilities or any other installations or services for the Premises utilities, not included in the additional monthly service fee as per Exhibit Six, including, without limitation, electricity, telecommunications and water, which shall be paid by Tenant in accordance with applicable fees, and usage shall be determined by the meters specifically installed for such purpose by the carriers of these services, or installed by Landlord, if necessary. Tenant acknowledges that third parties provide utilities and telecommunication services; as a result Landlord is not liable for any consequences on Tenant's operations or activities due to any interruption in such services.

ii) Condominium fee does not include any cost of repair or replacement of any of the items or systems listed above when damage is derived or caused by Tenant, its employees, subcontractors or third parties hired by Tenant and Tenant will be responsible for all such related costs of repair and/or replacement of any damaged items or systems.

iii) Water consumption for Premises green areas is not included in Condominium Fee, Tenant shall be responsible for cost of its own water consumption including Premises irrigation system.

iv) Electronic Access ID cards for its employees. The original cost for each ID card is estimated at eight (8.00) dollars, legal tender of the United States of America, per card. All repositions of electronic access ID cards will be charged at twenty (20.00) dollars, legal tender of the United States of America, per card.

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Garbage collection fee is not included in the Condominium fee; as a result garbage collection service has been established at the following monthly rate: US$30,00 for each five (5) cubic meter garbage container rent and US$30,00 for each garbage collection per container. Since Tenant premises are located on a Multitenant Building, all building users share garbage collection, as a result Tenant shall pay a prorated sum (based on premises area) of such amount on a monthly basis to Landlord on the same day of the rent payment. Condominium Owners General Assembly establishes garbage collection fee based on external contractors, as a result fees are subject to change at least once a year.

All payments derived from this Lease Agreement shall be made on the first five (5) days of the month, and in their full-stipulated amount, without any deductions. If a value added, sales tax, service tax, or any new tax where to be applied to any of such payments during the term of this Lease Agreement or applicable extensions, Tenant shall be obligated to increase the amount paid in order to cover such taxes, so Landlord will continue to receive its current rent net of value added taxes or any other similar government mandated charge.

All payments shall be made in cash, check from a bank of the Costa Rican national banking system, or electronic transfer to the Landlord's account. The validity of any form of payment different than cash remains subject to its approval and final credit in favor of Landlord. In case of wire transfers, the Tenant shall notify in writing to the Landlord, the date in which the transfer was executed, and such payment shall be deemed made on the date on which the transfer is credited by the Landlord's bank. The wire transfer information is attached hereto as Exhibit seven. All applicable transfer fees or bank charges must be paid by the Tenant. For purposes of this Agreement, the Tenant's address shall be the address in effect where payments should be made. In the event that the beginning or end of the term of this Lease is not the first of a month, rent shall be prorated such that Tenant shall only pay the portion of the rent allocated to the portion of the month the Premises are occupied by the Tenant.

Tenant shall be responsible to include under monthly fees payment any ordinary monthly fee increase and extraordinary monthly fee established by the Condominium Owner's General Assembly for year 2015 and beyond.

The totality of the monetary obligations contained in this section shall be considered part of Tenant's basic obligation to pay rent, in accordance with articles twenty five and sixty four of the General Urban and Suburban Lease Law in effect in Costa Rica.


2.01	Term of the Lease

The term of the lease shall be ten (10) years (the 'Lease Term'), commencing on the Rent Commencement Date. Tenant shall provide written notice to Landlord within one hundred and eighty (180) days before Lease Term expiration if it wishes to extend the lease for two years under consistent terms. The term may thereafter only be renewed by mutual written agreement of both parties.

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Parties hereby expressly waive the automatic renewal provided in article 71 of the Costa Rican Leases and Subleases Act (Ley General de Arrendamientos Urbanos y Suburbanos).


2.02	Date of Delivery and Legal Effect of the Agreement

The Landlord will deliver a Substantially Completed (as defined in Clause 1.07 above) Cold Shell Building to Tenant no later than November 30 ^th , 2015 provided the execution date of this Lease Agreement takes place before August 7 ^th , 2015. If delivery of Cold Shell Building to Tenant by Landlord is delayed more than three months after the original delivery date, Tenant shall have the right to terminate the Lease Agreement. If parties agree to execute the CMA for Cold Shell Building improvements (within two weeks of Lease Agreement execution) then Date of Delivery shall be deemed as the date when Cold Shell Building and Improvements is delivered to Tenant. Such delivery shall occur as per the master schedule delivery date agreed on the Improvements CMA Agreement.

Notwithstanding anything to the contrary in this Lease, Tenant's acceptance of the Premises shall not be deemed a waiver of Tenant's right to have defects in the Premises repaired at Landlord's sole expense. Tenant shall give notice to Landlord whenever any such defects become reasonably apparent, and Landlord will use its best efforts to repair such defects within twenty (20) days after receipt of written notice from Tenant; unless otherwise agreed among parties.

The rights and obligations of Tenant to enter the Premises shall be effective upon the Tennant's acceptance of the Delivery of the Premises. Legal effects regarding the use and enjoyment rights, as well as Tenant's rights and obligations as park tenants shall commence as of the execution of this Lease Agreement.


2.03	Delays not Attributable to the Tenant

In accordance with Article 705 of Costa Rican Civil Code, the Tenant guarantees and acknowledges that it will not file any lawsuits or claims to recover additional amounts from the Landlord originated in a failure to deliver the Premises in a timely manner for causes not attributable to the Landlord, its contractors, agents or employees. Tenant accepts that it shall not file a claim against the Landlord or attempt to collect any losses, damages, penalties, expenses, disbursements or amounts, including but not limited to, legal fees or expenses, request a sum for damages or losses, if due to Force Majeure, acts of God, or other causes not attributable to the Landlord, if it's not possible to deliver the property on the date convened herein.


2.04	Security Deposit

Tenant will provide Landlord a security deposit through a local bank guarantee, letter of credit or cash deposit, equivalent to the amount of thirty thousand three hundred and fifteen dollars (US$ 30,544.13), an amount equivalent to one (1) month's rent at the moment of execution of this Lease Agreement. After the Cold Shell Building is Substantially Completed, or, in the event the Improvements CMA is executed between the Tenant and Landlord, after the Cold Shell Building Improvements are Substantially Completed, Tenant will provide Landlord the security deposit

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mentioned above in cash if such security deposit was provided to Landlord through a local bank guarantee at the execution of this Lease Agreement. Such security deposit shall serve as security for this Lease Agreement, and such amount shall be retained by Landlord as a security deposit for the purposes described in this Agreement (the "Deposit"). The Deposit shall serve as a guarantee to cover the payment of outstanding services, repairs and any other obligation derived from this Agreement and contractually or legally owed by Tenant, to the Landlord's satisfaction. The Landlord shall have the right, but not the obligation, to use the Deposit to settle due outstanding rent payments. Tenant authorizes Landlord to use the Deposit to cover the expenses of obtaining construction permits for additional construction works requested by Tenant, provided such permits are not included in either the Rent or the Service or Condominium Fee. If all or part of the Deposit were used by the Landlord for any of the aforementioned items, the Tenant shall have an obligation to reinstate the used amount within five (5) calendar days following notice of its use by the Landlord, unless such use is made upon termination of the lease, in which case the remnant, if any, shall be returned by the Landlord to the Tenant in the thirty (30) calendar days following the date on which this Agreement is terminated, provided Tenant presented evidence satisfactory to the Landlord, that all utilities bills corresponding to the Tenant are fully paid. The Deposit shall not bear any interest for the benefit of the Tenant.

The security deposit shall be properly deposited in Landlords bank account in order to have this Lease Agreement effective.

Section Three: Tenant's Rights and Obligations


3.00	Restrictions of the Premises

The Tenant :

a) shall not modify the purpose of the Premises without prior authorization of the Landlord:

b) shall not carry out within the Premises, any type of activity that produces unreasonable or illegal noises, smells or materially disturbing activities to other occupants of Coyol Free Zone or other neighbors of the area where the Premises are located;

c) accepts that the activities performed in the Premises shall not produce emanations that can adversely affect the environment or people's health, and that the execution of such activities shall at all times comply with the corresponding local and national regulations;

d) shall not use the Premises for the storage of flammable or dangerous substances, materials or chemicals unless such substances, materials or chemicals are used in their

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manufacturing operations or are stored according to any and all applicable safety standards, Condominium Regulations and applicable law. In other cases, the Tenant must communicate in writing such circumstance to the Landlord, including a list describing such items. The substances, materials, or chemicals should be properly stored in accordance with the applicable laws, regulations, and any other safety provisions.

e) Sewage Treatment Plant . The Condominium has a residual waste water disposal plant which is designed to be used by all the Condominium Tenants. However, in order for the Tenant to use the facilities of such plant, it must abide by the conditions and requirements regarding the types of water that may be disposed of into the plant (Exhibit Five). Any violation of such conditions and requirements by the Tenant endangers the environment and the status of the Condominium general population and will therefore inhibit the Tenant to continue using the facilities, as well as to force it to pay any and all amounts required to fix, clean or recalibrate the plant back to its normal conditions as established in such Exhibit Five; this use of the sewage treatment plant is included in the Condominium Fees as established in section 2.00 of this agreement. Any damage caused directly or indirectly by Tenant, its employees, subcontractors or third parties to Sewer System originated by inadequate disposal of items such as but not limited to: gloves, personal ID badges, cell phones, head covers, booties, paper towels, tools or any other item related to Tenants activities within the Premises, will be paid by Tenant.


3.01	Coyol Free Zone Regulation

The Tenant shall respect at all times Coyol Free Zone's Internal Regulations, and the Condominium Bylaws, in its current text and its amendments. Said regulations, which the Tenant recognizes and accepts, are hereby attached to this Agreement as Exhibit Three.


3.02	Repairs and improvements

The Landlord shall be obligated to maintain, at its own expense, the Premises in general, including but not limited to, the exterior structural elements, exterior pluvial, and sewage water systems, as well as pay for all other maintenance fees or repairs derived from the normal wear and tear of the exterior of the Premises, including roof and parking spaces, or any other repair or maintenance of the Premises not caused directly or indirectly by the actions of Tenant or Tenant's subcontractors. Maintenance of existing equipment, as well as procurement of spare parts and replacements within the Premises shall be Tenant's sole responsibility, such maintenance shall be performed in an optimal way to operate and preserve the equipment, by Tenant or third parties approved by Landlord; a biannual report must be presented by Tenant to Landlord on all maintenance activities performed on existing equipment within the premises. The Landlord shall cooperate with Tenant to enforce all such guarantees with respect to the Premises which will reduce Tenant's maintenance obligations, and shall not be obligated to maintain at its expense the interior and improvements of the Premises in general, even if such maintenance could be considered as necessary because of the normal wear and tear of the inside of the building, unless otherwise stated in the Lease. The Tenant shall bear the cost of any other repair such as broken glasses, burnt light bulbs, gaskets and, generally, any service accessory or accessories incorporated to the Premises. Any damages or repairs caused or generated by the Tenant's negligence or willful misconduct shall

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run at the Tenant's expense, as well as all of the secondary elements added to the Premises by the Tenant. Notwithstanding the foregoing, the Tenant shall not, without the prior written consent of the Landlord which shall not be unreasonably withheld or delayed, make changes or adjustments to the Premises, even if related to indoor or outdoor maintenance works. It shall not be necessary to obtain prior consent from the Landlord to make indoor changes, adjustments or maintenance works whenever these do not affect the Premises' structure or are not permanently affixed to the same. The Landlord shall respond to any request for approval of changes or adjustments to the Premises within ten (10) calendar days of its receipt of such request. If authorization is received, all improvements made by Tenant, shall be for the benefit of the Landlord, without giving rise to the Tenant to request a deduction in the rent or an economic compensation for these upon termination of the lease's term. Except that Tenant shall have the right to remove: (i) its trade fixtures and business equipment, and (ii) any other equipment installed by Tenant in or about the Premises, whether or not affixed to the building. If such changes, adjustments or improvements may cause the Premises to suffer any damage Tenant has two options: (i) leave the improvements to the benefit of Landlord or (ii) repair Premises of any such damages immediately, at its sole cost and expense. In case Landlord has consent to an improvement of the Premises and provided such improvements increase the market value of the Premises, increase in payment of land tax, due to such increase in market value, shall be compensated by Tenant to Landlord through an increase in the monthly rate payment.


3.03	Responsibility for damages

The Tenant shall be (i) liable for any damage or loss incurred to or suffered by the Premises and equipment, which is caused by or attributable to its employee's, officer's and/or agents', or by third parties' or client's that visit or use the Premises and shall be (ii) responsible for the damages caused, by any of the aforementioned individuals, to common areas of the Coyol Free Zone.

Any form of damage caused by the Tenant, or any of the aforementioned individuals in this clause, shall be repaired by the Tenant, at its own expense, without the right to demand from the Landlord a reimbursement or cost deduction from the lease.

Repairs shall be initiated within a term no greater than eight (8) calendar days, except in cases of emergency, whereby they should be fixed immediately, allowing the Tenant to hire the workers it deems suitable. Prior to making the repairs, and except in cases of emergency, Tenant shall have the approval in writing of the Landlord with regards to quality and work to be performed, such approval shall not be unreasonably withheld. In such cases, the Landlord must respond within the following twenty-four hours following the receipt of a written communication by the Tenant. Should the Landlord not respond within the aforementioned time frame, the authorization will not be deemed granted, but the eight (8) day period will not begin until the day after an affirmative response is rendered by the Landlord. If plans for repair works have not been initiated in the aforementioned term, the Landlord shall provide written notice to the Tenant of said noncompliance and it shall provide to the Tenant a cure period of eight calendar days ("Cure Period") to initiate the repairs. If the Tenant does not initiate the repairs within the Cure Period, the Landlord may request the termination of the Agreement due to non-fulfillment and/or is fully authorized to deduct from the Deposit the necessary amount for repairs, and perform them on behalf of the Tenant.

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By virtue of this clause, the Tenant's liability is comprehensive and includes any violation acts to the legal system, caused by Tenant's activities in or use of the Premises, whether by its employees, officers and/or agents or by third parties or clients that visit or use the Premises, may these be civil, labor, environmental, health-related or any other sector, even when these acts are not subjected to an economic compensation.


3.04	Accidents

Except to the extent resulting from negligence or willful misconduct of one party's employees, contractors, agents of invitees, as the case may be, such party does not assume civil, penal, labor, or any other type of responsibility, for damages or losses incurred to the other party or third parties; notwithstanding the foregoing, in no event shall the Tenant or Landlord be liable for business losses or indirect damages, motivated or as a consequence of accidents caused by the other party, its agents, contractors, employees or invitees, as well as due to force majeure, during the effective term of this lease agreement and its possible extensions, except for those consequential damages by Tenant, related to Free Trade Zone matters that economically affect the Landlord.


3.05	Subleasing and Assignment of Rights

The Tenant may sublease or assign this Lease Agreement, or the rights derived from it, obtaining the Landlord's prior and written consent, to its affiliates, subsidiaries, or branches, provided that i) the Tenant demonstrates the existing relationship; and ii) the assignee or subtenant accepts to be bound by this Lease Agreement. Tenant shall remain jointly and severally liable against Landlord for all obligations in this Lease, not limited to monetary terms and conditions, and any already provided guarantees provided for the original Tenant, shall remain in favor of new tenant until the Termination Date of this Lease Agreement. Otherwise, the Tenant may not sublease the Premises, nor fully or partially assign this Lease Agreement without the prior written consent of Landlord.

Landlord may assign this Lease Agreement, or the rights derived from it totally or partially to a third party without the Tenant's prior or posterior consent or approval, provided that: (i) it gives notice to Tenant of such assignment; and (ii) no such assignment shall affect or modify Tenant's rights and obligations under this Lease Agreement.


3.06	Acquisition of Permits

The Tenant shall be responsible to process and acquire all those permits necessary for its operation, in addition to the performance of activities carried out within the Premises, such as, but not limited to, those permits and authorizations necessary for operating under a free zone regime. In the event that the Landlord authorizes any renovations or improvements required by Tenant on the property, the Tenant shall assume the costs, exclusively, for the permits, authorizations and other necessary acts for their execution, including any increases in payment of land taxes, due to Tenant's improvements. The Landlord shall cooperate with the Tenant in the acquisition of the corresponding permits or authorizations whenever its assistance is required for such purpose, and shall maintain all taxes and permits paid and up to date.

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3.07	Signage

The Tenant shall not place, or allow the placement of signs or notices of any type, in any exterior area of the building or common areas of the Coyol Free Zone, other than the clearly designated sites by the Landlord for these purposes, and shall provide proper maintenance to such signs, so that they are in perfect condition always. Moreover, the Tenant shall comply with the signage specifications included in the Condominium Bylaws or other applicable documents to the Tenant by virtue of the present agreement.


3.08	Notice of failures or accidents to the Landlord

Except to the extent resulting from negligence, hidden defects or willful misconduct of the Landlord as the case may be, the Landlord does not assume civil, penal, labor, or any other type of responsibility, for damages or losses incurred to Tenant or third parties. Notwithstanding the foregoing, in no event shall the Landlord be liable for losses, motivated or as a consequence of accidents caused to it due to the Tenant's responsibility, fraud or fault, as well as due to force majeure, during the effective term of this lease agreement and its possible extensions.


3.09	Compliance with the laws and applicable regulations

Unless otherwise established in this Lease, both parties shall comply with applicable laws at its own cost and expense, and execute, whenever the case, the provisions of any laws, ordinances, rules, orders, acts, regulations, and legal requirements in effect applicable to the respective party regarding the Premises and the activities that Tenant will perform in the Premises. In particular, but not limited to, both parties shall comply with the corresponding and applicable provisions of the Law of the Free Zone Regime and its regulations, as well as the Customs Law and its regulations. There shall be no liability under this Lease against Landlord for consequential damages, including but not limited to loss of profits.


3.10	Prohibition of Common Areas Obstruction

The obstruction of common areas of the Coyol Free Zone with equipment, vehicles, machinery, raw material or any other goods owned by the Tenant or his/her contractors, employees, dependents or visitors, or any other person related with him/her, is expressly prohibited. The Tenant must always supervise that common areas are free from obstructions caused by any of the persons mentioned in this clause. Particularly, the parking of vehicles owned by the Tenant's personnel or visitors in the main streets of the Coyol Free Zone is expressly prohibited. The Tenant accepts to pay a twenty five dollar fine per incident for parking and/or obstruction violations of these provisions, plus the cost of the obstruction removal resulting from the non-compliance with this provision. The amount corresponding to the fine shall be charged with the Rent corresponding to the next month.


3.11	Prohibition of Transit Areas Obstruction

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Sidewalks, entrances, passageways, elevators, stairs, lobbies and other common transit areas may not be obstructed, used or occupied differently for the entrance or exit of machinery, material, equipment, vehicles or persons, depending on the case, related with the activities developed by the Tenant. The Tenant must guarantee the compliance with this obligation on the part of his/her representatives, contractors, employees, dependents, visitors, and other related personnel, however noncompliance will generate the fine provided in Section 3.10 above.


3.12	Transfer of Material, Machinery, or Heavy Equipment

The Tenant may not move any equipment, goods or heavy machinery in and outside the building without the suitable means to avoid damaging the constructions located in the Premises, and it must be done in coordination with the Landlord as established in the Condominium Bylaws. Landlord shall not unreasonably delay or deny such movements required by Tenant. Any damage resulting from the movement of the goods mentioned in this clause must be repaired by the Tenant pursuant to the terms established in clauses 3.03 of the present Agreement.


3.13	Other commitments

Tenant shall: a) commit to the Condominium By-laws, and Park Regulations as available at Landlord, and it shall remain a beneficiary of the Free Trade Zone Regime at all times, and keep all requirements to qualify as such in order and current, as long as its role as beneficiary is required by law in order for Landlord to obtain and maintain benefits as Park Administrator; b) Upon termination of the Lease Agreement, Tenant may remove any and all Tenant improvements at Tenant's expense, and will retain ownership of same, provided any damages to the Premises due to such removal, are repaired by Tenant, subject to Section 3.02. Tenant improvements not removed by Tenant will become the property of Landlord. Tenant agrees to pay for the removal and disposal of any Tenant improvements that Landlord does not wish to keep, at Tenants sole cost and expense. Upon Termination, Landlord will inform Tenant in writing of the cost of such works and Tenant will then have a term of seven calendar days to respond, in writing, if it agrees Landlord makes such repairs, or if it wishes to make them itself. Failure to respond shall be deemed and acceptance of the performance of the works by Landlord. If Landlord performs the works after Tenant's acceptance, Tenant shall reimburse Landlord all costs and expenses of such works in the term of ten (10) working days after works have been performed; and c) Allow the Landlord and / or PROCOMER to inspect and visit the Premises during normal business hours as well as to inspect any and all materials, merchandise, and assets in order to fulfill their control responsibility; provided, however, three (3) days' notice is provided to Tenant.

Section Four: of the Landlord's Rights and Obligations


4.01	Payment of Taxes

The Landlord shall pay all applicable municipal and real estate taxes for the Premises, and all taxes required for the correct operation of the Coyol Free Zone. The Tenant shall pay all applicable taxes for its own activities to be carried on the Premises during the term of this Lease Agreement,

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and any increase to the municipal and real estate taxes derived from any and all improvements by the Tenant or on behalf of Tenant.


4.02	Inspection Right

The Landlord reserves the right to visit the Premises any moment, provided that they inform the Tenant at least seventy two (72) hours in advance. Inspections referred in this clause must be done during Tenant's working hours, through its officers or third parties hired to that effect. Exceptionally, with prior authorization by the Tenant, inspections may be carried out off the regular working hours. Landlord shall comply with Tenant's confidentiality requirements, security precautions and health and safety requirements during any such entry.


4.03	Ownership of the Goods Left in the Real Estate

After fifteen calendar days of the last day Tenant pays to rent according to Section 5.01, or after the termination date of the present Agreement, for any cause imputable or not to the Tenant, or in case of eviction for non-compliance with the payment, whatever happened last, if Tenant has not vacated and delivered the Premises back to Landlord, Tenant shall pay Rent for such fifteen calendar days at a rate that shall be the current applicable Rent multiplied by 1.5, and Tenant may continue to pay such Rent until it vacates such Premises, for a maximum term of thirty calendar days since the termination date. After such thirty calendar day term, the Premises shall be deemed vacated, and any goods owned by the Tenant found inside the Premises or in the common areas of the Coyol Free Zone shall be considered abandoned by the Tenant. Therefore, the Landlord may take possession of the same. The Tenant waives any right to seek any compensation resulting from such circumstance.


4.04	Showing of Facilities

Prior to the termination of the Lease Agreement or any extension, the Landlord shall have the right to show the Premises to people interested in leasing or purchasing it, during the last six months of the term in effect. The visits to show the Premises must be scheduled by the Landlord within Tenant's working hours, and shall only require a prior verbal communication to the Tenant. In case any such showing does involve any third party that Tenant demonstrates to Landlord is, might be or might cooperate with a competitor of the Tenant, Tenant can require Landlord and/or any third party to sign a confidentiality form prior to such showing. Tenant shall be in no obligation of showing or explaining any such third party any part of its processes or operations or the purpose of any equipment found within the premises. If any visit of Landlord may interfere with Tenant's production process, Tenant may reschedule such visit for a time when no interference would be caused within the next five (5) calendar days.


4.05	Entry Right on the part of the Landlord to Repair Damages

The Landlord, its employees or contractors, shall have the right to enter the Premises in order to make repairs that might correspond to it, in accordance with this Agreement and the legislation in effect. Nevertheless, the Landlord must previously coordinate with the Tenant the time in which such repairs shall take place, trying as far as possible, and pursuant to the particularities of the repair,

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that its execution must be done on the less prejudicial moment for the normal functioning of the Tenant's activities.


4.06	Right of Sale of the Real Estate

Tenant shall have the following purchase options from the effective delivery date of the premises of this Lease Agreement in which to decide if it will execute such options under the following conditions:

i) Purchase Option No.1: Valid only during month twelve (12) of the "Lease Agreement" under the following conditions:


•	Fixed amount equivalent to US$3,495,000.00


•	Fixed price amount of US$3,495,000.00 already includes a credit equivalent to US$112,000.00 regarding ground works performed at Lot 11, and a credit equivalent to US$118,000.00 regarding 12-month lease payment.

ii) Purchase Option No.2: Valid only between day one (1) of month thirteen (13) and last day of month twenty four (24) of the Lease Agreement under the following conditions:


•	Alternative A): "Price Match" offer in case of a third party buyer (investment fund or similar) is interested in property, Landlord grants the opportunity for Tenant to match de price offer.


•	Alternative B): If no formal interest is shown from third party buyer (investment fund or similar) to buy the property from Landlord, then Landlord grants Tenant the option to purchase the property under the following scheme: the total sum equivalent to the following twelve months of rent divided between an 8% cap. rate.

Subject to the provisions an limitations of this Section 4.06 and the Purchase Options established within this contract, the Landlord shall have the right to sell the Premises to any third party without prior or posterior consent or approval of the Tenant during the term of the Lease Agreement and the Lease Agreement will remain valid and in force as established in article 75 of the Costa Rican Leases and Subleases Act, provided that: (i) no sale shall affect or modify Tenant's rights and obligations under this Lease, (ii) Tenant shall have no obligations to subordinate this Lease to the interest of any mortgage, deed of trust, or collateral assignment to any third party that becomes the new owner of the Premises, and (iii) Landlord gives notice to Tenant of such sale once the public deed related to that sale has been executed.


4.07	Release of liability in case of accidents

The Tenant releases the Landlord from any responsibility for any accidents resulting from electricity, flood, gas or any other phenomena resulting or not from the Premises usage, unless such

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were caused by the negligence or willful misconduct of the Landlord or hidden defects of the Premises. Tenant shall indemnify, defend, protect and hold harmless Landlord from all damages, liabilities, claims, judgments, actions, attorneys' fees, consultants' fees, costs and expenses arising from the negligence or willful misconduct of Tenant or its agents, contractors, employees or invitees, or the breach of Tenant's obligations or representations under this Lease.


4.08	Release of liability in case of robbery or theft

The Tenant discharges the Landlord from any responsibility for robbery or theft in the Premises, unless the same was caused by negligence or imprudence, as defined under the Civil Code of the Republic of Costa Rica, on the part of the Landlord or the security company contracted by the Landlord and could not have been reasonably prevented by the security company.


4.09	Non waiver of rights

The fact that one party does not require compliance with any of the terms and conditions herein established, may not be considered as a waiver to the rights and actions granted by means of the present Agreement or the legislation applicable to the case.


4.10	Insurance

Landlord shall have in place insurance policies for Premises and related equipment described in Exhibit Three; Tenant may contract, at its own expense, additional insurance policies in connection to Tenant's owned or leased equipment and improvements on Premises performed as per Tenant's request.

All costs related to insurance policies derived from events caused by Tenant or attributable directly or indirectly to Tenant, its employees, visitors or subcontractors shall be paid in full by Tenant.

Section Five: Termination of the Agreement


5.00	Moment of Termination

The Tenant shall remain obligated to pay Rent, as well as any other monetary obligations, and to comply with any terms and conditions of this Lease Agreement, until it has returned the Premises to Landlord, even if it has previously vacated the same. The Premises shall be clean when delivered, with swept floors. Return of possession will be deemed to occur when the Tenant returns all keys to the Premises and/or other parts of the Park if applicable.


5.01	Termination for convenience in advance on the part of the Tenant

If prior to the delivery of the Premises, or at any time prior to the termination of the agreed term of this Lease Agreement, the Tenant wishes to terminate the Lease Agreement, it must provide prior written notice to the Landlord nine (9) months in advance of the expected termination date, and shall pay Landlord the equivalent sum of twelve months of rent as penalty for early termination.

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Additionally, Tenant shall continue to pay rent until a new Tenant occupies the premises, twelve months elapse, or the Lease Term minus twelve months is reached, whatever happens first. Landlord will not return the security deposit to Tenant in case of anticipated termination of the Lease Agreement.

Tenant shall be free to negotiate the price of any improvements made to the building by Tenant with the new tenant under clause 3.02 terms and as long as Tenant is paying rent (building being occupied or not). Once payments from Tenant to Landlord have ceased, Tenant's right to negotiate improvements with new tenant will be deemed expired.

Parties agree to waive early termination fees and/or penalties applicable to the Tenant if Tenant decides to relocate its operation into a stand-alone building or a "Quick Start Building" owned at the time of relocation by Landlord or any of its subsidiaries or related companies.


5.02	Events of default by Tenant and termination of agreement by Landlord.

Landlord may terminate the Lease Agreement without the need of a Cure Period due to: a) upon Rent Commencement Date, non-compliance by Tenant in respect to all obligations of the Free Trade Zone Regime, including having all permits and authorizations current, and if it is not a beneficiary of the Free Trade Zone Regime; provided the non-compliance of such obligations may economically, materially and adversely affect Landlord. Otherwise the thirty calendar day Extended Cure Period established below shall apply; b) In case the due payment of Rent and Service Fee is not made within seven (7) days after receipt of notice from Landlord. Tenant shall pay compensation as indicated in Section 5.01 above, without prejudice of further indemnities. Tenant may inform Landlord of any reason(s) for delay(s) in payment, and Landlord reserves the right to accept or refuse such late payment in good faith. In case the Landlord does not receive payment within the time set forth above, Landlord will be entitled to terminate the Lease Agreement with responsibility for Tenant, and Landlord will have the right to be compensated in accordance with Section 5.01 above

Landlord may also terminate the Lease Agreement after the Cure Period, as defined below, due to other cause expressly authorized by the legislation in effect ("Events of Default"). Once the Landlord detects an Event of Default, it will communicate so in writing to the Tenant.

Except as otherwise established above, Tenant will have seven (7) calendar days ("Cure Period") subsequent to the receipt of the communication to remedy any of the following defaults, provided such defaults are Tenant's fault, and are not justified reasonably: a) Failure to comply with restrictions of use of the Premises as per the Lease Agreement and Condominium By-laws; b) Failure to comply with the responsibility for damages to the Premises and Condominium by Tenant (including its employees, officers and/or agents, or by third parties or clients that visit or use the Premises); c) Failure to comply with obtainment and maintenance of all construction and operation permits in order, c) Material non- compliance with all applicable laws and regulations, and with the Other Commitments in Section 3.13 above. Non material events of default shall be cured according to the next paragraph.

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Tenant will have thirty (30) calendar days ("Extended Cure Period") if it fails to comply with any other obligations provided in the Lease Agreement, not specifically referred to in the foregoing paragraph, subsequent to the receipt of a communication to remedy the situation causing such non-compliance.

If the Tenant does not amend the situation that originated the communication during the Extended Cure Period or the Cure Period provided, or gives a satisfactory response to Landlord, at least requesting an extension of the Extended Cure Period or the Cure Period, or if such response is unreasonable, Landlord will be entitled to terminate the Lease Agreement with responsibility for Tenant, and Landlord will have the right to be compensated in accordance with Section 5.01 above.


5.03	Events of default by Landlord and termination in advance on the part of the Tenant

Non-compliance on the part of Landlord with the obligations established in the Lease Agreement or any other cause expressly authorized by the legislation in effect ("Events of Default") will be considered a breach. Once the Tenant detects an Event of Default, it will communicate so in writing to Landlord. Landlord will have thirty (30) calendar days ("Cure Period"), subsequent to the receipt of a communication to remedy the situation causing such non-compliance.

If the Event of Default makes the Premises materially unusable to Tenant for its intended purpose, Landlord shall have seven (7) calendar days ("a Cure Period") subsequent to the receipt of the communication to remedy the Event of Default. If the Event of Default is not corrected after the Cure Period, or gives a satisfactory response to Tenant, at least requesting an extension of the Cure Period, or if such response is unreasonable, Tenant will be entitled to take all actions established in the Leases and Subleases Law of Costa Rica (Ley General de Arrendamientos Urbanos y Suburbanos), including the cure of such default itself at Landlord's expense, if applicable. In that case, Landlord will reimburse Tenant for all costs and expenses so incurred by Tenant within thirty (30) calendar days after Tenant delivers to Landlord all invoices correspondent to such costs, unless both parties agree that payment is made by means of deduction of the total amount owed for such costs from next monthly rent payment thereafter due under this Lease, and if such payment is not enough, by deducting from the following months until the complete amount owed and its interest has been credited to the Tenant. If Landlord does not agree with the amount charged by Tenant, it will be resolved as per Section 7.01 below

Section Six. Final and Miscellaneous Provision


6.00	Communications and Notices

Any notice that the Parties are required to make in accordance with this Agreement, shall be made in writing by means of a personal delivery or any other written means, in which the remission and reception date, are irrefutably recorded, and sent to the following addresses and during office hours. Notices shall be deemed delivered on reception date.

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a) to the Landlord:	At the administrative offices of Carlos Wong, at the administrative offices of Coyol Free Zone, located in Coyol Free Zone administrative building.
b) To the Tenant:	To the attention of Luis Gutierrez at Tenant's Offices in Coyol Free Zone.


6.01	Governing Law and Dispute Resolution

This Lease Agreement shall be interpreted and governed by the laws of the Republic of Costa Rica.

Any and all disputes, claims, differences, disputes or controversies arising out of or in relation to any aspect of this Lease Agreement, its business matter, performance, liquidation, interpretation, validity or any breach thereof, shall be resolved by the Ley de Proceso Monitorio Arrendaticio of Costa Rica. All other matters related to this Lease Agreement shall be hereby irrevocably submitted to the jurisdiction of Costa Rican Courts. Additionally, if the matter in dispute is not included in such law, parties shall resolve the issue by arbitration in accordance with the bylaws of the International Center for Conciliation and Arbitration of the Costa Rican-American Chamber of Commerce ("CICA"), arbitration shall take place in San Jose, Costa Rica at the International Center for Conciliation and Arbitration of the Costa Rican-American Chamber of Commerce ("CICA"). The parties hereby agree to submit voluntarily and unconditionally to its rules and aforementioned bylaws and claim knowledge thereof. Any such arbitration shall be conducted in the Spanish language. The arbitration tribunal shall be composed of three arbitrators; each party shall appoint one arbitrator, and these two arbitrators shall appoint a third arbitrator who will act as president of the arbitration tribunal. The foregoing agreement to arbitrate is specifically enforceable and the award rendered by the Arbitrators is final and binding on the parties to this Agreement and the judgment may be entered upon any arbitration award. By virtue of the above, parties expressly waive the use of the jurisdiction of Costa Rican Courts, with the exception established above.

Any matters that cannot be subject to arbitration under Costa Rican Law shall be hereby irrevocably submitted to the jurisdiction of Costa Rican Courts.


6.02	Amendments to the Agreement

Any agreed modifications to the present Agreement must be done in writing and signed by the Parties. This clause shall be of special application for anything related with the lease price and its form of payment; therefore, no modification may be alleged, unless the previous procedure is followed.


6.03	Estimation

The present Agreement is estimated for tax purposes in the sum of three million six hundred and sixty-five thousand two hundred and ninety five dollars with sixty cents (US$3,665,295.60) legal currency of the United States.


6.04	Recordation.

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Subsequent to execution, any party may at its sole discretion and expense, register this Lease and all Exhibits thereto in the National Public Registry of Costa Rica.


6.05	Vested Rights

The Tenant recognizes that this Agreement shall not create any goodwill, or right of use or other intangible right, by virtue of which the eventual increase in the commercial value of the real estate shall be recognized for its use or occupation, and that in case such rights ever arise in accordance with any applicable legal regulation or commercial practice, Tenant hereby assigns such right to the Landlord in the amount of one dollar, legal currency of the United States of America. The Tenant recognizes that this provision is essential on the part of the Landlord to enter into the present Agreement.


6.06	Headings

The titles used as headings for each clause and chapter of this Agreement are introduced to ease it's reading and shall not be considered as part of the text thereof, to interpret its contents.


6.07	Incorporation of Exhibits

The Exhibits identified in this Agreement are incorporated herein by reference and made a part hereof.


6.08	Survival

All indemnities contained in any section of this Agreement shall survive the expiration or other termination of this Agreement with respect to acts or events occurring or alleged to occur during the term of this Agreement and are expressly made for the benefit of, and shall be enforceable by any or all of the indemnified Parties.


6.09	Severability

If any of the provisions of this Lease shall contravene or be invalid under the laws of the country, province, municipal, state or jurisdiction where it is applied, such contravention or invalidity shall not invalidate the Lease or any other portions thereof and the remainder of this Lease or the application thereof to other persons or circumstances shall not be affected thereby.


6.10	Counterparts

This Agreement may be executed in counterparts, each of which when executed and delivered shall be deemed an original. Such counterparts shall together (as well as separately) constitute one and the same instrument.


6.11	Confidentiality

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confidential nature relating to the business or the assets of Tenant or Landlord, or any of their respective affiliates or related companies that is not public information known by either of the parties prior to the date of the Letter of intent or this Lease. Neither party will disclose Confidential Information of the other party except disclosure to its (or its affiliates) respective directors, principals, officers, employees, advisors, agents, lenders and consultants to the extent necessary to perform its obligations under this Lease Agreement or as otherwise required by law, by court order, or by obligations imposed on the disclosing party pursuant to any listing agreement with any national securities exchange.


6.12	Arbitration

Any and all disputes, claims, differences, disputes or controversies arising out of or in relation to any aspect of this Agreement, its business matter, performance, liquidation, interpretation, validity or any breach thereof, shall be resolved by arbitration in accordance with the bylaws of the International Center for Conciliation and Arbitration of the Costa Rican-American Chamber of Commerce ("CICA"). The parties hereby agree to submit voluntarily and unconditionally to its rules and bylaws and claim knowledge thereof. Disputes shall be resolved by an Arbitration Tribunal composed of three arbitrators; Each party shall appoint one arbitrator, and these two arbitrators shall appoint a third arbitrator who will act as president of the Arbitration Tribunal. The Parties hereby agree, that they cannot assign their rights and obligations under this Contract totally or partially without mutual approval however Tenant may assign its rights and delegate its duties hereunder to any entity which is controlled by or under the common control of Tenant, its ultimate parent or any of its affiliates and Landlord may assign its right to compensation under this agreement, for financing purposes. The Guarantee shall survive any such assignment, and remain valid.

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first above written.



/s/ Juan José Chacón
Name: Juan José Chacón

Date and Place:	August 15, 2015, San Jose, Costa Rica

By: Establishment Labs S.A.
Tenant



/s/ Álvaro Carballo Pinto			/s/ André Garnier Kruse
Álvaro Carballo Pinto			André Garnier Kruse

Date and Place:			Date and Place:


By: Zona Franca Coyol S. A.
Landlord

LIST OF EXHIBITS



Exhibit One:		Certifications of Legal Representation.

Exhibit Two:		Location at the Master Plan of Premises and Layout.

Exhibit Three:		Cold Shell Building Description

Exhibit Four:		a) Condominium By-laws and b) Park Regulations.

Exhibit Five:		Usage regulation of the Sewage Treatment Plant.

Exhibit Six:		Additional Monthly Service Fee.

Exhibit Seven:		Wire Transfer Information.

Exhibit Eight:		LOI dated February 23rd , 2015

Exhibit Nine:		Letter of Credit

EXHIBIT 1

Certificates of Legal Representation

EXHIBIT 2

Location at the Master Plan of Premises and Layout

EXHIBIT 3

Cold Shell Building Description

EXHIBIT 4

Condominium By-laws and Park Regulations

EXHIBIT 5

Usage regulation of the Sewage Treatment Plant

EXHIBIT 6

Additional Monthly Service Fee

EXHIBIT 7

Wire Transfer Information

EXHIBIT 8

LOI dated February 23rd, 2015

EXHIBIT 9

Letter of Credit

Exhibit 10.16

LEASE AGREEMENT

Entered into at the city of San José, on the 1 ^st day of the month of November of the year 2009, the "Effective Date" between:

ZONA FRANCA COYOL, S. A. , corporate identification card number three- one hundred one-four hundred and twenty thousand five hundred twelve, (the "Landlord"), registered in the Mercantile Section of the Public Registry under book five hundred sixty, entry ten thousand three hundred and seventy eight, consecutive one hereon represented by Huber André Garnier Kruse, personal identity card number one- four hundred sixteen- one thousand three hundred forty four, and Álvaro Carballo Pinto, personal identity card number one - five hundred and thirty six - six hundred and fifty five, acting jointly and with sufficient authority for the execution of this lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book five hundred and sixty five, entry eleven thousand five hundred and ninety two, consecutive one.

for the one part and for the other,

ESTABLISHMENT BIOTECH S. A. corporate id 3-101-366337, corporate identification number three- one hundred one- three hundred and sixty six thousand three hundred and thirty seven, (the "Tenant"), registered in Mercantile Section of the Public Registry under book five hundred seventy four, entry sixty six thousand three hundred and seventy nine, represented by Juan José Chacón Quirós, personal identity card number one – eight hundred twenty two – cero cero six, acting with sufficient authority for the execution of this lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book two thousand and nine, entry two hundred twenty six thousand seven hundred and forty eight - one.

Whereas

1. Landlord is the registered owner of a property (the "Property"), located in the "Condominio Horizontal Industrial Comercial con Fincas Filiales Primarias Individualizadas (FFPI) Zona Franca Coyol" (the "Condominium" or "Coyol Free Zone"), condominium identity number 3‑109- 533883, a condominium registered in the Costa Rican Public Registry, Province of Alajuela, Property Number M‑2640- 000, filial lot number fourteen, registered in the Public Registry Property of Alajuela, Property Number 2- 68505-F- 000.

2. The Condominium is a Free Trade Zone, with Zona Franca Coyol, S. A. as Condominium administrator.

3. ZFC will build a manufacturing building in the Property in Zona Franca Coyol, identified as multitenant, and it shall lease Biotech a manufacturing area of seven hundred and twenty (720) square meters (approximately 7750.08 square feet) inside said building, hereinafter the "Leased Real Estate".

Now therefore in consideration of the mutual considerations, covenants and promises herein made, and in consideration of the representations, warranties, and covenants herein contained, the Parties have agreed to execute this lease agreement (hereinafter referred to as the "Lease Agreement"):

Section One: Of the Leased Real Estate

1.00 Leased Real Estate

The Landlord rents out to the Tenant, who accepts the Leased Real Estate, a portion of a manufacturing building identified as Multitenant Building, located in a section of Condominium identified as filial lot number fourteen, that shall be delivered by Landlord to Tenant in accordance with the "Landlord's Shell Building Scope of Work" attached hereto as Exhibit One.

1.01 Permitted Use

The Leased Real Estate shall be used by the Tenant for the design, manufacture, storage, sales and distribution of medical devices components and related products under the Free Trade Zone Regime. Tenant shall not use the Leased Real Estate for sports-booking or gambling activities, manufacture of arms or parts thereof, or tobacco products. These prohibitions will extend to any and all successors or assigns.

The Tenant shall not alter the stated use of the Leased Real Estate without the express written authorization of the Landlord. In accordance with the Agreement, Tenant shall at all times comply with all the applicable national, municipal and other governmental regulations in the carrying out and execution of its activities, including without limitation, Health Ministry regulations, Free Zone regime and customs regulations. Tenant shall also comply with any Condominium regulations in effect, as attached hereto as Exhibit Two, or any future regulations or resolutions approved in accordance with Condominium bylaws.

1.02 Leased Real Estate Conditions

1.02.01 The Tenant shall receive the Leased Real Estate according to the conditions of this clause and with the conditions and characteristics described in the "Landlord's Shell Building Scope of Work" attached hereto as Exhibit One, the contents of which the Tenant understands and accepts without objections in its entirety.

1.02.02 Tenant understands and accepts without objections, the contents of Exhibit One, and hereby acknowledges and accepts that any changes in the scope and contents of Exhibit One may result in a change in the Date of Delivery as defined in Section 2.02 below. In case of any extension in the. Date of Delivery caused by Tenant, the Tenant will have to begin to pay Rent on the Rent Commencement Date as established in Section 2.00.

1.02.03 Tenant may request changes to Exhibit One, subject to Landlord's written approval, by providing written request to Landlord, the " Change Order ". Landlord shall, have ten (10) business days after the receipt of any Change Order, to approve or reject changes requested

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totally or partially, and if it approves the Change, establish an estimation of the increase in cost and time of delivery of the Leased Real Estate, as corresponding. Increases in cost will be estimated based upon the total of indirect (design and inspection insurance construction permits and quality control plus utilities) and direct construction costs of performing the Changes, plus an additional fee of five percent (5%) of such cost. This fee covers only the administrative costs incurred by Landlord. Tenant will have five (5) business days to accept or reject the proposal given by the Landlord. Delays in the completion of Landlord's work, and/or the Date of Delivery due to Change Orders shall be considered a Tenant Delay.

1.03 Tenant Construction

Upon delivery by Landlord of the Leased Real Estate, Tenant will be able to perform within the Leased Real Estate additional construction and improvement activities, the " Tenant's Work ", necessary for its occupation. Tenant shall obtain all required construction permits for Tenant's Work at its sole cost and expense, including but not limited to any and all applicable fees and taxes. Landlord may allow that Tenant enters the Leased Real Estate before the Date of Delivery personally or through its subcontractors, subject to Landlord's rules and regulations, so that it may advance in Tenant's Work. All Tenant's Work shall be subject to Landlord's approval before its performance, which approval shall not be unreasonably withheld. Delays in the Date of Delivery due to Tenant's fault, shall be the responsibility of Tenant, and will not generate penalties to Landlord. Tenant will be responsible for obtaining the appropriate permits as required by any applicable authority, including SETENA and PROCOMER, for its work and operations.

1.04 Additional Facilities

In addition to any other facility specifically included in this lease agreement, the Leased Real Estate shall comprise: (a) Parking.- The Leased Real Estate includes four (4) parking spaces located in the perimeter of the Multitenant Building, outlined by road demarcations according to the country's standards and to the Plans and Specifications that are an, integral part of the present Agreement and which have been enclosed as Exhibit One; If additional parking spaces are required by Tenant, the Landlord, subject to availability, may assign such additional spaces in a parking area that is convenient for the Landlord, and will charge a fee for every additional parking. The Tenant, will be responsible for assigning as many parking spaces as he deems necessary within the four (4) parking spaces assigned to it, for use by its VISITORS. Landlord will not be responsible for providing parking spaces for such VISITORS; (b) Common areas.-The Tenant can make use of Coyol Free Zone's common areas according to the regulations and specifications included in the Condominium By-laws in its current form, and including any subsequent amendments. The current form of these regulations has been enclosed as an integral part of this Agreement as Exhibit Two, however since all common areas shall be subject to the exclusive management and control of the Landlord, Landlord reserves the right to modify, alter or enlarge common areas, or their use, within the Condominium By-laws, to its sole discretion; (c) Sewage Treatment Plant.- The Tenant shall make use of the sewage treatment plant located in Coyol Free Zone, according to the usage regulation included as Exhibit Three.

1.05 Special systems, equipment and additional constructions

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The Tenant may request, at its own expense, the installation of certain special systems and equipment in the Leased Real Estate in accordance with the Condominium By-laws.

If Tenant decides to carry out any additional works in the Leased Real Estate, that will not damage or alter the property, it may do so, provided it has submitted to the Landlord before commencing any such activities, all the required construction permits. Landlord will cooperate with Tenant in the application of all such permits. Works in the Leased Real Estate that will become affixed to it, or change it permanently, or cause damage to it are not accepted, unless Landlord has provided Tenant written consent, and the permits indicated above have been provided. Furthermore, Tenant shall be responsible to cover any costs associated with obtaining such permits, including but not limited to any applicable taxes.

Section Two: of the Rent and Lease Term

2.00 Rent

The monthly rent to be paid for the Leased Real Estate (the " Rent ") by the Tenant shall be six thousand one hundred and twenty dollars (US$6,120.00) Legal currency of the United States per month, at a rate of eight dollars and fifty cents (US$8.50) per square meter of the of constructed building (excluding parking areas). The Tenant shall begin paying Rent on November 1 ^st , 2009, the "Rent Commencement Date". Rent Commencement Date is not subject to the Date of Delivery. The monthly Rent in each period shall be paid in advance, on the first calendar day of each month.

Furthermore, Tenant shall pay the following:

a) A monthly service fee in accordance with the Service Agreement, attached hereto as Exhibit Four, that the Tenant will enter with the Landlord simultaneously to the execution of this Lease Agreement with effect from the Rent Commencement Date, at a rate of twenty five cents of dollar (US$0,25) per leased square meter and is comprehensive of the following services:

i) Exterior maintenance of building,

ii) Building (cold shell & office) insurance and property taxes for the cold shell building.

iii) On site fully equipped customs office.

iv) Parking areas maintenance.

All Rent and Service Charges indicated herein (including Rent for parking spaces), shall be payable at the rate indicated herein for the first year of the Lease Term. Thereafter, until expiration of the Lease, any payments to Landlord shall increase by five per cent (5%) from each anniversary of the Rent Commencement Date and until the expiration of this Lease Agreement, using as basis for such increase the amount effective the previous year.

b) Tenant will also pay all condominium fees, at the fee of fifty cents of dollar (US$0.50) per leased square meter of construction area. The fee is subject to change if it is so decided

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by the Condominium Owners General Assembly. The Condominium fee covers the following services:

i) Free Zone Perimeter security twenty four hours a day, all year round.

ii) Common Area Maintenance — CAM: cleaning of streets and Condominium common areas, maintenance of common gardens and green common areas (includes Condominium common areas water fees), access to wastewater treatment plant usage, Garbage collection by means of a shared three point five cubic meter (3,5 m3) dumpster, maintenance of sewer, potable and storm water pipes, general maintenance of infrastructure.

c) Any costs of utilities or any other installations or services for the Leased Real Estate's. Utilities shall be paid by Tenant in accordance with applicable fees, and usage shall be determined by the meters specifically installed for such purpose by the carriers of these services, or installed by Landlord, if necessary.

d) Additionally, Tenant will pay the following reimbursable direct expenses, or its corresponding pro-rata portion for the multitenant building:

i) Utilities fees.

ii) Leased Real Estate's green areas maintenance, irrigation and replanting.

ZFC has encouraged the availability of the following optional services provided by authorized suppliers at the Park, costs provided upon request:

• Medical & Dental Services.


•	Specialized Recruitment services, meeting rooms & temporary offices.


•	Construction Management Services.


•	Banking offices & ATM's.

All payments can be made in cash, check, or electronic transfer to the Landlord's account. The validity of any form of payment different than cash, remains subject to its approval and final credit in favor of Landlord. In case of wire transfers, the Tenant shall notify in writing to the Landlord, the date in which the transfer was executed, and such payment shall be deemed made on the date on which the transfer is credited by the Landlord's bank. All applicable transfer fees or bank charges must be paid by the Tenant. For purposes of this Agreement, the Landlord's address shall be the address in effect where payments should be made. In the event that the beginning or end of the term of this Lease is not the first of a month, rent shall be prorated such that Tenant shall only pay the portion of the rent allocated to the portion of the month the Leased Real Estate is occupied by the Tenant.

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Tenant shall make payments referenced above on the first day of the month, and in their full stipulated amount, without any deductions. If the Tenant is or shall become obligated to make any deductions or to retain any amount, originated in a value added or sales tax, or any other circumstance that would reduce the amount to be received by the Landlord, the Tenant shall be obligated to increase any payments to be made to the Landlord up to their full original amount.

The totality of the monetary obligations contained herein this section shall be considered part of Tenant's basic obligation to pay rent, in accordance with articles twenty five and, sixty four of the General Urban and Suburban Lease Law in effect in Costa Rica.

2.01 Term of the Lease

The term of the lease shall be effective as of the date of execution of the lease and until October 31 ^st , 2010 (the 'Lease Term'), commencing on the Date of execution of the Lease. An automatic six month extension under the same terms will be available at Tenant's option, subject to a notice accepting the automatic extension by Tenant to Landlord, at least ninety (90) calendar days prior to the termination of the current Lease Term, with additional extensions of the term, if any, by mutual written agreement of both parties.

2.02 Date of Delivery and Legal Effect of the Agreement

The Landlord shall deliver the Leased Real Estate on or before November 1 ^st , 2009 (the "Date of Delivery"). For all purposes of this Agreement, the Date of Delivery shall be deemed to have occurred five (5) business days following a written communication to Tenant, notifying the Substantial Completion of the Leased Real Estate. Substantial Completion shall be understood as having completed the "Landlord's Shell Building Scope of Work" attached hereto as Exhibit One, in more than ninety-five (95%) percent, (the "Substantial Completion). Forty eight (48) hours following the reception of the report of inspections, Tenant shall present Landlord a written acceptance or opposition of the delivery of the Leased Real Estate.

At the Date of Delivery primary sanitary, electrical, and potable water accesses at connection points must have been completed and shall be in good order and operating condition.

Landlord and Tenant shall agree in writing on or before the Date of Delivery, on a list of pending works (hereinafter the "Punch List"). The Punch List shall specify the civil, architectural, mechanical and electrical items that are incomplete which, in the aggregate, are minor in character and do not materially interfere with Tenant's future works in the Leased Real Estate, in accordance with the provisions of this Lease.

Punch List items works that have not been completed on the Date of Delivery shall be completed by Landlord within thirty (30) calendar days following the Date of Delivery, unless otherwise stated.

Notwithstanding anything to the contrary in this Lease, Tenant's acceptance of the Leased Real Estate shall not be deemed a waiver of Tenant's right to have defects in the Leased Real Estate

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repaired at Landlord's sole expense. Tenant shall give notice to Landlord whenever any such defects become reasonably apparent, and Landlord shall repair such defects as soon as practicable.

In the event that there is a dispute on the Substantial Completion report triggering the Date of Delivery, both the Tenant and the Landlord agree to submit such dispute to an Engineers and Architects Board Arbitration process, in accordance with 'the procedural rules of such institution. The arbitration procedure shall not last more than thirty days and shall determine whether the Leased Real Estate complies with the plans and specifications detailed herein, and both parties will abide by this decision, however the arbitration process will not interfere with the Rent Commencement Date. If the Arbitration process determines that the works are not in compliance, the Lease Real Estate shall not be deemed as delivered, and the Landlord must initiate within five (5) days any additional work required to complete the Leased Real Estate. In such case Landlord shall also return to the Tenant any Rent paid since the supposed Date of Delivery, however, if the Arbitration Process determines that the works are in compliance, Landlord shall keep all Rent previously paid by Tenant. The fact that the Arbitration process has determined that the Leased Real Estate complies with the specifications does not preclude Tenant's right to present claims based on hidden defects in the Leased Real Estate.

The rights and obligations of Landlord with regards to the construction of the Leased Real Estate, and the rights and obligations of Tenant to enter the Leased Real Estate on the Date of Delivery, shall be effective upon the execution of this Agreement. Legal effects regarding the use and enjoyment rights, as well as Tenant's obligations to pay rent and any other rights and obligations as park tenants, shall commence as of the Date of Delivery of the Leased Real Estate.

Landlord shall notify Tenant in writing of any delays on the schedule caused by the Tenant or its contractors, in which case the agreed Date of Delivery shall be extended one day for every day of Tenant's delay. If due to changes in the scope of Exhibit One requested by Tenant, or for causes attributable to the Tenant there is a delay in the delivery of the Leased Real Estate (hereinafter a "Tenant Delay"), the Tenant shall begin to pay Rent (as defined in section 2.00 hereof), on the original projected Rent Commencement Date. Notwithstanding the foregoing, the payment of service fees agreed on clause 2.00 hereof, shall commence as of the Date of Delivery (as defined in this section 2.02).

Parties hereby acknowledge that Landlord shall not be responsible for delays in obtaining permits or in beginning or completing any works, due to the lack of such permits, when it has diligently requested them according to local customary practice, and has not obtained them due to delays by the authority or entity in charge of such permits, in which case, the Date of Delivery shall be adjusted in the same term of the delay.

2.03 Delays not Attributable to the Tenant

If the delivery of the Leased Real Estate does not take place on or before the expected Delivery Date, and such Delay is not due to a Tenant Delay, the Landlord shall acknowledge in favor of the Tenant a Fine, as a fixed and sole compensation for damages or losses, that shall be equivalent to the amount of one day's Rent, per day of delay.

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The relevant fine shall be deducted by applying a twelfth of the amount in each month of this Lease Agreement to complete twelve months of deductions to cover for such penalties. In accordance with Article 705 of Costa Rican Civil Code, the Tenant guarantees and acknowledges that it will not file any lawsuits or claims to recover additional amounts from the Landlord originated in a failure to deliver the Leased Real Estate in a timely manner for causes attributable to the Landlord, its contractors, agents or employees. Furthermore, Tenant will hold the Landlord harmless after having received the compensation provided for in accordance with this section. Additionally, Tenant accepts that it shall not file a claim against the Landlord or attempt to collect any losses, damages, penalties, expenses, disbursements or amounts, including but not limited to, legal fees or expenses, request a sum for damages or losses, if due to Force Majeure, acts of God, or other causes not attributable to the Landlord, if is not possible to deliver the property on the date convened herein.

2.04 Security Deposit

With the execution of this Lease Agreement, the Landlord has received from the Tenant, six thousand one hundred and twenty dollars (US$6,120.00) an amount equivalent to one month's rent. Such security deposit shall serve as security for this Agreement, and such amount shall be retained by Landlord as a security deposit for the purposes described in this Agreement (the "Deposit"). The Deposit shall serve as a guarantee to cover the payment of outstanding services, repairs and any other obligation derived from this Agreement, to the Landlord's satisfaction. The Landlord shall have the right, but not the obligation, to use the Deposit to settle outstanding rent payments. Tenant authorizes Landlord to use the Deposit to cover the expenses of obtaining construction permits for additional construction works requested by Tenant. If all or part of the Deposit were used by the Landlord for any of the aforementioned items, the Tenant shall have an obligation to reinstate the used amount within five (5) calendar days following notice of its use by the Landlord, unless such use is made upon termination of the lease, in which case the remnant, if any, shall be returned by the Landlord to the Tenant in the sixty (60) calendar days following the date on which this Agreement is terminated, and prior verification that all utilities bills corresponding to the Tenant are fully paid. The Deposit shall not bear any interest for the benefit of the Tenant.

2.05 Bank Guaranty

With the execution of this Lease Agreement, the Landlord has received from the Tenant, a Bank Guaranty issued by the National Bank of Paris, for the sum in Euros equivalent to two hundred and fifty thousand dollars, at the exchange rate of the issuance date of the guaranty, which shall serve as a guaranty for the compliance of Tenant's obligations under the Lease Agreement, as well as a guaranty for the compliance of Tenant's obligations under an independent lease agreement between the parties for the lease of a manufacturing area of two thousand five hundred and twenty (2520) square meters (approximately 27,125 square feet). The Bank Guarantee shall remain valid from the date of execution of the first of any of these leases, and until one month after the termination of the last one, and shall survive any assignment, as well as any other lease of Tenant with Landlord.

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above. Landlord will also withhold the Bank Guaranty until any further unpaid obligations of Tenant to Landlord under the Lease Agreement or other lease agreements signed among the parties, including utilities, are dully paid. If after thirty (30) days of giving notice to Tenant of any outstanding obligations these are not paid, Landlord shall execute the Bank Guaranty for the amount owed.

Section Three: Tenant's Rights and Obligations

3.00 Restrictions of the Leased Real Estate

The Tenant:

a) shall not modify the purpose of the Leased Real Estate without prior authorization of the Landlord:

b) shall not carry out within the Leased Real Estate, any type of activity that produces noises, smells or disturbing activities to other occupants of Coyol Free Zone or other neighbors of the area where the Leased Real Estate is located, beyond what is customarily expected form a medical devices production plant;

c) accepts that the activities performed in the Leased Real Estate shall not produce emanations that can adversely affect the environment or people's health, and that the execution of such activities shall at all times comply with the corresponding local and national regulations;

d) shall not use the Leased Real Estate for the storage of flammable or dangerous substances, materials or chemicals unless such substances, materials or chemicals are used in their manufacturing operations. In these cases, the Tenant must communicate in writing such circumstance to the Landlord, including a list describing such items. The substances, materials, or chemicals should be properly stored in accordance with the applicable laws, regulations, and any other safety provisions.

3.01 Coyol Free Zone Regulation

3.02 Repairs and improvements

The Landlord shall be obligated to maintain, at its expense, the Leased Real Estate in general, including but not limited to, the exterior structural elements, exterior pluvial, and sewage water systems, as well as pay for all other maintenance fees or repairs derived from the normal wear and tear of the exterior of the Leased Real Estate. The Landlord shall cooperate with Tenant to enforce all such guarantees with respect to the Leased Real Estate which will reduce Tenant's maintenance obligations, but shall not be obligated to maintain at is expense the interior of the Leased Real Estate in general, even if such maintenance could be considered as necessary because of the normal wear

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and tear of the building. The Tenant shall bear the cost of any other repair such as broken glasses, burnt light bulbs, gaskets and, generally, any service accessory or accessories incorporated to the Leased Real Estate. Any damages or repairs caused, or generated by the Tenant's negligence or willful misconduct shall run at the Tenant's expense, as well as all of the secondary elements added to the Leased Real Estate by the Tenant. Notwithstanding the foregoing, the Tenant shall not, without the prior written consent of the Landlord which shall not be unreasonably withheld or delayed, make changes or adjustments to the Leased Real Estate, even if related to indoor or outdoor maintenance works. It shall not be necessary to obtain prior consent from the Landlord to make indoor changes, adjustments or maintenance works whenever these do not affect the Leased Real Estate's structure or are permanently affixed to the same. If authorization is received, all investments, non-removable improvements or the removals that once removed may cause damage to the Leased Real Estate, shall be for the benefit of the Landlord, without giving rise to the Tenant to request a deduction in the rent or an economic compensation for these upon termination of the lease's term.

3.03 Responsibility for damages

The Tenant shall be liable for any damage or loss incurred to or suffered by the Leased Real Estate, which is caused by or attributable to its employees, officers and/or agents, or by third parties or clients that visit or use the Leased Real Estate. Furthermore, it shall be responsible for the damages caused, by any of the aforementioned individuals, to common areas of the Coyol Free Zone.

Repairs shall be initiated within a term no greater than eight (8) calendar days, except in cases of emergency, whereby they should be fixed immediately, allowing the Tenant to hire the workers it deems suitable. Prior to making the repairs, it shall have the approval in writing of the Landlord with regards to quality and work to be performed. In such cases, the Landlord must respond within the following twenty-four hours following the receipt of a written communication by the Tenant. Should the Landlord not respond within the aforementioned time frame, the authorization will not be deemed granted, but the eight (8) day period will not begin until the day after an affirmative response is rendered by the Landlord. If plans for repair works have not been initiated in the aforementioned term, the Landlord shall provide written notice to, the Tenant of said noncompliance and it shall provide to the Tenant a cure period of eight calendar days ("Cure Period") to initiate the repairs. If the Tenant does not initiate the repairs within the Cure Period, the Landlord may request the termination of the Agreement due to non-fulfillment and/or is fully authorized to deduct from the Deposit the necessary amount for repairs, and perform them on behalf of the Tenant.

By virtue of this clause, the Tenant's liability is comprehensive and includes any violation acts to the legal system, caused by Tenant's activities in or use of the Leased Real Estate, whether by its employees, officers and/or agents or by third parties or clients that visit or use the Leased Real

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Estate, may these be civil, labor, environmental, health-related or any other sector, even when these acts are not subjected to an economic compensation.

3.04 Accidents

Except to the extent resulting from negligence or willful misconduct of the Landlord's employees, agents of invitees, as the case may be, the Landlord does not assume civil, penal, labor, or any other type of responsibility, for damages or losses incurred to the Tenant or third parties. Notwithstanding the foregoing, in no event shall the Tenant or Landlord be liable for business losses, motivated or as a consequence of accidents caused by the other party, its agents, contractors, employees or invitees, or resulting from fraud or fault of such other party, as well as due to force majeure, during the effective term of this lease agreement and its possible extensions.

3.05 Subleasing and Assignment of Rights

Tenant shall have the right to sublet all or part of the facility with prior approval of the proposed tenant by Landlord, which shall not be unreasonably withheld, provided the new Tenant is able to provide a Bank Guaranty satisfactory to Landlord, otherwise, Tenant shall remain jointly and severally liable against Landlord for all obligations in this Lease, not limited to monetary terms and conditions, and any already provided guarantees provided for the original Tenant, shall remain in favor of new tenant until the Termination Date of this Agreement. Otherwise, the Tenant may not sublease the Leased Real Estate, nor fully or partially assign this contract.

3.06 Acquisition of Permits

The Tenant shall be responsible to process and acquire all those permits necessary for its operation, in addition to the performance of activities carried out within the Leased Real Estate, such as, but not limited to, those permits and authorizations necessary for operating under a free zone regime. In the event that the Landlord authorizes any renovations or improvements on the property, the Tenant shall assume the costs, exclusively, for the permits, authorizations and other necessary acts for their execution. The Landlord shall cooperate with the Tenant in the acquisition of the corresponding permits or authorizations whenever its assistance is required for such purpose.

3.07 Signage

3.08 Notice of failures or accidents to the Landlord

Except to the extent resulting from negligence or willful misconduct of the Landlord as the case may be, the Landlord does not assume civil, penal, labor, or any other type of responsibility, for

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damages or losses incurred to Tenant or third parties. Notwithstanding the foregoing, in no event shall the Landlord be liable for losses, motivated or as a consequence of accidents caused to it due to the. Tenant's responsibility, fraud or fault, as well as due to force majeure, during the effective term of this lease agreement and its possible extensions.

3.09 Compliance with the laws and applicable regulations

Tenant shall comply with, at its own cost and expense, and execute, whenever the case, the provisions of any laws, ordinances, rules, orders, acts, regulations, and legal requirements in effect applicable to the Tenant regarding the Leased Real Estate and the activities that Tenant will perform in the Leased Real Estate. In particular, but not limited to, it shall comply with the corresponding and applicable provisions of the Law of the Free Zone Regime and its regulations, as well as the Customs Law and its regulations. The Tenant shall exclusively bear all expenses resulting from the compliance with any legal regulations in effect. There shall be no liability under this Lease against Landlord for consequential damages, including but not limited to loss of profits.

3.10 Prohibition of Common Areas Obstruction

3.11 Prohibition of Transit Areas Obstruction

3.12 Transfer of Material, Machinery, or Heavy Equipment

The Tenant may not move any equipment, goods or heavy machinery in and outside the building without the suitable means to avoid damaging the constructions located in the Leased Real Estate. Any damage resulting from the movement of the goods mentioned in this clause must be repaired by the Tenant pursuant to the terms established in clauses 3.03 of the present Agreement,

3.13 Other commitments

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The Tenant shall, (a) Commit to the Condominium By-laws, and it shall remain a beneficiary of the Free Trade Zone Regime at all times, and keep all requirements to qualify as such in order and current. Finally, Tenant shall execute a Service Agreement with Landlord. (b) Upon termination of the Lease Agreement, Tenant may only remove that which is allowed by law. Tenant improvements not removed by Tenant will become the property of Landlord. Tenant agrees to pay for the removal and disposal of any tenant improvements that Landlord does not wish to keep.

4.00 Section Four: of the Landlord's Rights and Obligations

4.01 Payment of Taxes

The Landlord shall pay all applicable municipal and real estate taxes for the Leased Real Estate as well as all taxes required for the correct operation of the Coyol Free Zone. The Tenant shall pay all applicable taxes for its own activities to be carried on the Leased Real Estate, during the term this Agreement.

4.02 Inspection Right

The Landlord reserves the right to visit the Leased Real Estate at any moment, provided that they inform the Tenant at least twenty-four (24) hours in advance. Inspections referred in this clause must be done during Tenant's working hours, through its officers or third parties hired to that effect. Exceptionally, with prior authorization by the Tenant, inspections may be carried out off the regular working hours. Landlord shall comply with Tenant's security precautions and health and safety requirements during any such entry.

4.03 Ownership of the Goods Left in the Real Estate

After ten working days of the termination date of the present Agreement, for any cause imputable or not to the Tenant, or in case of eviction for noncompliance with the payment, any goods owned by the Tenant found inside the Leased Real Estate or in the common areas of the Coyol Free Zone shall be considered abandoned by the Tenant, with the exclusion of the goods described herein below. Therefore, the Landlord may take possession of the same. The Tenant waives any right to seek any compensation resulting from such circumstance.

Tenant will fabricate medical-standard clean room facilities inside the Leased Real State to accommodate its manufacturing operations. After the termination of the present agreement, said facilities may be useful to some other future tenant, and for that reason Landlord will make its best efforts to find a tenant that is interest in buying the facility from Tenant in order to lease the Leased Real Estate. If after three months of the termination of this Agreement no new tenant has been found interested in the facilities, Tenant will demolish the facilities within an eight-day period, returning the facilities to its original condition. Landlord shall guarantee complete access to Tenant in order to accomplish the demolition task.

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If Landlord finds a new tenant within the three-month period, but which is not interested in the facilities, it shall give notice to Tenant. Tenant shall proceed with the demolition within an eight-day period, returning the facilities to its original condition.

Landlord may agree at any time after the termination of this Agreement to buy the facilities from Tenant.

4.04 Showing of Facilities

Prior to the termination of the Agreement or any extension, the Landlord shall have the right to show the Leased Real Estate to people _, interested in leasing or purchasing it, during the last six months of the term in effect. The visits to show the Leased Real Estate must be scheduled by the Landlord within Tenant's working hours, and shall only require a prior verbal communication to the Tenant. Landlord shall comply with Tenant's security precautions and health and safety requirements during any such entry.

4.05 Entry Right on the part of the Landlord to Repair Damages

The Landlord, its employees or contractors, shall have the right to enter the Leased Real Estate in order to make repairs that might correspond to it, in accordance with this Agreement and the legislation in effect. Nevertheless, the Landlord must previously coordinate with the Tenant the time in which such repairs shall take place, trying as far as possible, and pursuant to the particularities of the repair, that its execution must be done on the less prejudicial moment for the normal functioning of the Tenant's activities.

4.06 Right of Sale of the Real Estate

The Landlord shall have the right to sell the Leased Real Estate to any third party during the term the Agreement.

4.07 Release of liability in case of accidents

The Tenant releases the Landlord from any responsibility for any accidents resulting from electricity, flood, gas or any other phenomena resulting or not from the Leased Real Estate usage, unless such were, caused by the gross negligence or willful misconduct of the Landlord. Tenant shall indemnify, defend, protect and hold harmless Landlord from all damages, liabilities, claims, judgments, actions, attorneys' fees, consultants' fees, costs and expenses arising from the negligence or willful misconduct of Tenant or its agents, contractors, employees or invitees, or the breach of Tenant's obligations or representations under this Lease.

4.08 Release of liability in case of robbery or theft

The Tenant discharges the Landlord from any responsibility for robbery or theft in the Leased Real Estate, unless the same was caused by negligence or imprudence, as defined under the Civil Code of the Republic of Costa Rica, on the part of the Landlord or the security company contracted by the Landlord.

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4.09 Non waiver of rights

The fact that the Landlord does not require compliance with any of the terms and conditions herein established, may not be considered as a waiver to the rights and actions granted by means of the present Agreement or the legislation applicable to the case.

4.10 Insurance

The Tenant shall have an All Risk insurance to protect the goods of his/her property inside the offices. The Landlord, on the other hand, shall have All Risk insurance that includes the coverage against earthquake, fire, and any other damage resulting from nature to protect the Leased Real Estate up to a cold shell. Both, the Landlord as well as the Tenant, shall maintain their insurance at replacement values.. Neither the Landlord, nor the Tenant shall cover the deductibles of the other party, in case of loss. In no event shall Landlord be responsible to Tenant for consequential damages or losses.

Section Five: Termination of the Agreement

5.00 Moment of Termination

The Tenant shall remain obligated to pay Rent, as well as any other monetary obligations, and to comply with any terms and conditions of this Agreement, until it has returned the Leased Real Estate to Landlord, even if it has previously vacated the same. The Leased Real Estate shall be clean when delivered, with swept floors.

5.01 Termination in advance on the part of the Tenant

If prior to the delivery of the Leased Real Estate, or at any time prior to the termination of the agreed term of this Agreement, the Tenant wishes to terminate the Agreement, it must provide prior written notice to the Landlord six (6) months in advance of the expected termination date. As compensation for the termination in advance of the Agreement, Tenant shall pay Landlord the totality of the monthly rental fees (total Rent).

5.02 Events of default by Tenant and termination of agreement by Landlord.

Landlord may terminate the Lease Agreement without the need of a Cure Period due to: a) non-compliance by Tenant in respect to all obligations of the Free Trade Zone Regime, and if it is not a beneficiary of the Free Trade Zone Regime; b) In case the payment of Rent and Service Fee is obtained from the execution of the Bank Guaranty according to Section 2.05 above and Tenant does not reissue or reinstates the Bank Guaranty to its full original value, within ten (10) business days after payment is made by the issuing bank; and Tenant shall pay compensation for the early termination as indicated in Section 5.03 below, without prejudice of further indemnities.

Landlord may also terminate the Lease Agreement after the Cure Period, as defined below, due to non-compliance on the part of the Tenant with the obligations established in the Lease

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Agreement or any other cause expressly authorized by the legislation in effect ("Events of Default"). Once the Landlord detects an Event of Default, it will communicate so in writing to the Tenant.

Tenant will have seven (7) calendar days ("Cure Period") subsequent to the receipt of the communication to remedy any of the following defaults: a) Failure to comply with restrictions of use of the Leased Real Estate as per the Lease Agreement and Condominium By-laws; b) Failure to comply with the responsibility for damages to the Leased Real Estate and Condominium by Tenant (including its employees, officers and/or agents, or by third parties or clients that visit or use the Leased Real Estate); c)Failure to comply with obtainment and maintenance of all construction and operation permits in order, c) Non- compliance with all applicable laws and regulations, and d) noncompliance with the Other Commitments in Section 3.13 above, expect the obligation to, remain a beneficiary of the free trade zone regime that will have no Cure Period.

Tenant will have thirty (30) calendar days ("Cure Period") if it fails to comply with any other obligations provided in the Lease Agreement, not specifically referred to in the foregoing paragraph, subsequent to the receipt of a communication to remedy the situation causing such non-compliance.

If the Tenant does not amend the situation that originated the communication during the Cure Periods provided, or gives a satisfactory response to Landlord, at least requesting an extension of the Cure Period, or if such response is unreasonable, Landlord will be entitled to terminate, the Lease Agreement with responsibility for Tenant, and Landlord will have the right to be compensated in accordance with Section 5.02 above.

5.03 Events of default by Landlord and termination in advance on the part of the Tenant

Non-compliance on the part of Landlord with the obligations established in the Lease Agreement or any other cause expressly authorized by the legislation in effect ("Events of Default") will be considered a breach. Once the Tenant detects an Event of Default, it will communicate so in writing to Landlord. Tenant will have thirty (30) calendar days ("Cure Period"), subsequent to the receipt of a communication to remedy the situation causing such non-compliance.

If the Event of Default makes the Leased Real Estate materially unusable to Tenant for its intended purpose, Landlord shall have seven (7) calendar days ("Cure Period") subsequent to the receipt of the communication to remedy the Event of Default. If the Event of Default is not corrected after the Cure Period, or gives a satisfactory response to Tenant, at least requesting an extension of the Cure Period, or if such response is unreasonable, Tenant will be entitled to take all actions established in the Lease Law of Costa Rica (Ley General de Arrendamientos Urbanos y Suburbanos), including the cure of such default itself at Landlord's expense, if applicable.

Section Six. Final and Miscellaneous Provision

6.00 Communications and Notices

Any notice that the Parties are required to make in accordance with this Agreement, shall be made in writing by means of a personal delivery or any other written means, in which the remission

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and reception date are irrefutably recorded, and sent to the following addresses and during office hours. Notices shall be deemed delivered on reception date.



a) to the Landlord:	At the administrative offices of Coyol Free Zone, located in Coyol Free Zone administrative building. Fax number (506) 2434 2407. Copy to ANS, to the attention of Catalina Soto, fax number (506) 2201-8850.
b) To the Tenant:	Feinzaig, Scharf & van der Putten, Torre Mercedes Building, Paseo Colon, San Jose. Fax number 2295 6644. Addressed to Luis Gutierrez.

6.01 Governing Law and Dispute Resolution

This Agreement shall be interpreted and governed by the laws of the Republic of Costa Rica.

6.02 Amendments to the Agreement

6.03 Estimation

The present Agreement is estimated for tax purposes in the sum of seventy three thousand four hundred and forty dollars (US$73,440.00) legal currency of the United States.

6.04 Recordation.

Subsequent to execution, any party may at its sole discretion and expense, register this Lease and all Exhibits thereto in the National Public Registry of Costa Rica.

6.05 Vested Rights

The Tenant recognizes that this Agreement shall not create any right of use or other intangible right, by virtue of which the eventual increase in the commercial value of the real estate shall be recognized for its use or occupation, and that in case such rights ever arise in accordance

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with any applicable legal regulation or commercial practice, Tenant hereby assigns such right to the Landlord in the amount of one dollar, legal currency of the United States of America. The Tenant recognizes that this provision is essential on the part of the Landlord to enter into the present Agreement.

6.06 Headings

The titles used as headings for each clause and chapter of this Agreement are introduced to ease its reading and shall not be considered as part of the text thereof, to interpret its contents.

6.07 Incorporation of Exhibits

The Exhibits identified in this Agreement are incorporated herein by reference and made a part hereof.

6.08 Survival

6.09 Severability

6.10 Counterparts

6.11 Confidentiality

Landlord and Tenant each agree to respect and preserve the confidentiality of all "Confidential Information" received from the other. "Confidential Information" means (i) the existence and contents of this Lease Agreement, and (ii) any information of a proprietary or confidential nature relating to the business or the assets of Tenant or Landlord, or any of their respective affiliates or related companies that is not public information known by either of the parties prior to the date of this Letter of Intent or the Lease. Neither party will disclose Confidential Information of the other party except disclosure to its (or its affiliates) respective directors, principals, officers, employees, advisors, agents, lenders and consultants to the extent necessary to perform its obligations under this Lease Agreement or as otherwise required by law, by court order,

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or by obligations imposed on the disclosing party pursuant to any listing agreement with any national securities exchange.

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first above written.

(SIGNATURE PAGE FOLLOWS)



/s/ Juan José Chacón Quirós
Juan José Chacón Quirós

Date and Place:	San Jose, CR, 07/11/2009

By: Establishment Biotech S.A.
Tenant



/s/ André Garnier Kruse		/s/ Álvaro Carballo Pinto
André Garnier Kruse		Álvaro Carballo Pinto

Date and Place:	20 Nov, SJ, CR	Date and Place:	20 Nov, SJ, CR

By/ Zona Franca Coyol S. A.
Landlord

LIST OF EXHIBITS


Exhibit One :	Shell Building Scope of Work.


Exhibit Two :	a) Condominium By-laws and b) Park Regulations


Exhibit Three :	Usage regulation of the Sewage Treatment Plant.


Exhibit Four :	Service Agreement

Exhibit One : Shell Building Scope of Work

Exhibit Two : a) Condominium By-laws and b) Park Regulations

Exhibit Three : Usage regulation of the Sewage Treatment Plan

FIRST AMENDMENT TO LEASE AGREEMENT

Entered into at the city of San Jose, on the twenty second day of the month of October of the year 2010, between:

ZONA FRANCA COYOL, S. A. , corporate identification card number three- one hundred one-four hundred and twenty thousand five hundred twelve, (the "Landlord"), registered in the Mercantile Section of the Public Registry under book five hundred sixty, entry ten thousand three hundred and seventy eight, consecutive one, hereon represented by Huber André Garnier Kruse, personal identity card number one- four hundred sixteen- one thousand three hundred forty four, and Álvaro Carballo Pinto, personal identity card number one - five hundred and thirty six - six hundred and fifty five, acting jointly and with sufficient authority for the execution of this lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book five hundred and sixty five, entry eleven thousand five hundred and ninety two, consecutive one.

for the one part and for the other,

ESTABLISHMENT LABS S. A. corporate identification number three- one hundred one- three hundred and sixty six thousand three hundred and thirty seven, (the "Tenant"), registered in Mercantile Section of the Public Registry under book five hundred seventy four, entry sixty six thousand three hundred and seventy nine, represented by Juan José Chacón Quirós, personal identity card number one - eight hundred twenty two - zero zero six, and François-Xavier Badoit, with French passport number zero three TH eight three three five eight, acting jointly with sufficient authority for the execution of this lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book two thousand and nine, entry two hundred twenty six thousand seven hundred and forty eight - one.

Whereas

1. A Lease Agreement was executed on November 1 ^st , 2009, by and between Zona Franca Coyol S.A as Landorld, and Establishment Labs S. A. (previously "Establishment Biotech S.A.") as Tenant, hereinafter the "Lease Agreement". All capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Lease Agreement.

2. Parties want to extend the term of the Lease Agreement.

Now therefore in consideration of the mutual promises herein made, and the representations, warranties, and covenants herein contained, and incorporating the above recitals, the Parties have agreed to execute this First Amendment to the Lease Agreement (hereinafter, referred to as the "Amendment")

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FIRST : Parties agree to modify and substitute Section 2.01 of the Lease Agreement, and therefore, froni this day forward it shall read:

" 2.01 Term of the Lease

The term of the lease shall be effective as of the date of execution of the lease and until Octbber 31 ^st , 2013 (the 'Lease Term'), with extensions of the term, if any, by mutual written agreement of both parties. "

SECOND : The execution of this Amendment does not affect the legal effect of any clauses of the Lease, Agreement applicable to Leased Real Estate not specifically referred to in this Amendment. All provisions of the Lease Agreement not specifically referred to in this Amendment shall keep their full validity and effect.

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first above written.



/s/ Juan José Chacón Quirós		/s/ François-Xavier Badoit
Juan José Chacón Quirós		François-Xavier Badoit

By: Establishment Labs S.A.

Tenant



/s/ André Garnier Kruse		/s/ Álvaro Carballo Pinto
André Garnier Kruse		Álvaro Carballo Pinto

By: Zona Franca Coyol S. A.

Landlord

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SECOND AMENDMENT TO LEASE AGREEMENT

Entered into at the city of San José, on the 24 ^th day of the month of September of the year 2012, the "Effective Date" between:

ZONA FRANCA COYOL, S. A ., corporate identification card number three- one hundred one-four hundred and twenty thousand five hundred twelve, (the "Landlord"), registered in the Mercantile Section of the Public Registry under book five hundred sixty, entry ten thousand three hundred and seventy eight, consecutive one, hereon represented by Huber André Garnier Kruse, personal identity card number one- four hundred sixteen- one thousand three hundred forty four, and Álvaro Carballo Pinto, personal identity card number one - five hundred and thirty six - six hundred and fifty five, acting jointly and with sufficient authority for the execution of this lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book five hundred and sixty five, entry eleven thousand five hundred and ninety two, consecutive one.

for the one part and for the other,

ESTABLISHMENT LABS S. A. corporate identification number three- one hundred one- three hundred and sixty six thousand three hundred and thirty seven (before ESTABLISHMENT BIOTECH S. A. ), (the "Tenant"), registered in Mercantile Section of the Public Registry under book five hundred seventy four, entry sixty six thousand three hundred and seventy nine, represented by Juan José Chacón Quirós, personal identity card number one - eight hundred twenty two - cero cero six, acting with sufficient authority for the execution of this lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book two thousand and nine, entry two hundred twenty six thousand seven hundred and forty eight - one.

Whereas

1. A Lease Agreement was executed on November 1 ^st , 2009, by and between Zona Franca Coyol S. A. as Landlord, and Establishment Labs S. A. as Tenant, hereinafter the "Lease Agreement", with a term ending on October 31 ^st , 2010.

2. On July 31 ^st , 2010, Parties agreed to extend the term of the lease until October 31 ^st , 2013.

3. Parties want to further extend the term of the Lease Agreement until October 31 ^st , 2015.

4. Parties wish to substitute the Bank Guaranty with a Corporate Guaranty.

5. Tenant is owing Landlord Rent, Park Services Fees, and parking space rental fees from February 29 ^th , 2012 and until September 30 ^th , 2012, for a total amount of sixty eight thousand and thirteen dollars and ninety five cents (US$68,013.95), hereinafter the "Outstanding Fee", and Parties wish to establish a payment agreement.

6. All capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Lease Agreement.

Now therefore in consideration of the mutual promises herein made, and the representations, warranties, and covenants herein contained, and incorporating the above recitals, the Parties have agreed to execute this Second Amendment to the Lease Agreement (hereinafter, referred to as the "Amendment")

FIRST : Parties agree to modify and substitute Section 2.01 of the Lease Agreement, and therefore, from this day forward it shall read:

" 2.01 Term of the Lease

The term of the lease shall be effective as of the date of execution of the lease and until October 31 ^st , 2015 (the 'Lease Term'). An automatic five year extension under the same terms will be available at Tenant's option, subject to a notice accepting the automatic extension by Tenant to Landlord, at least three (3) months prior to the termination of the current Lease Term, with additional extensions of the term, if any, by mutual written agreement of both parties. "

SECOND : Parties agree to substitute the Bank Guaranty of the Lease, therefore, on this date, Landlord has returned Tenant the Bank Guaranty to Tenants' entire satisfaction, and Tenant has delivered to Landlord a Personal Guaranty by EL's stockholders, as attached hereto, the "Stockholder Guaranty". The new Stockholders Guaranty is included in the Lease as Exhibit Five. By virtue of the above, Parties agree to modify and substitute Section 2.05 of the Lease Agreement, so that from this day forward it shall read:

" 2.05 Stockholders Guaranty

In addition to the Deposit, Tenant has delivered to the Landlord a Guaranty issued personally by the EL Stockholders, attached hereto as Exhibit Five (the "Stockholders Guaranty"). The Stockholders Guaranty shall serve as a guarantee for the compliance of Tenant's obligations under this Lease Agreement and shall remain valid from the date hereof until sixty (60) days after the Termination Date.

Upon termination of the Lease, Landlord will withhold from the Security Deposit any unpaid obligations of Tenant to Landlord under the Lease Agreement, including utilities, and refund to Tenant the balance of the Security Deposit within sixty (60) days, subject to the conditions provided above. Provided the Security Deposit is not sufficient to cover it, Landlord will also withhold the Stockholders Guaranty until any further unpaid and undisputed obligations of Tenant to Landlord under the Lease Agreement or other lease agreements signed among the parties, including utilities, are duly paid. If after thirty (30) days of giving notice to Tenant of any outstanding and undisputed obligations these are not paid, Landlord shall execute the Stockholders Guaranty for the amount owed. In any case

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Tenant shall have the right to receive back any documents related to such Stockholders Guarantee against the payment of an amount equal to the due and disputed payments. "

THIRD : Tenant shall pay Landlord the Outstanding Fee in thirty six (36) equal monthly installments of one thousand eight hundred and eighty ninety dollars and 28/100 (US$1,889.28) plus interest . The Outstanding balance shall generate interest at a fixed annual rate of Libor plus six point five per cent (6.5%) of Outstanding Fee balance, which shall be applied starting on October 31 ^st , 2012.

The monthly payments shall be made by Tenant together with the payments of the regular rental fees, and shall be considered Rent for all legal effects of the agreement, including the guaranty of such payments by means of the Corporate Guaranty.

FOURTH : Parties agree to modify and substitute Section 5.01 of the Lease Agreement, and therefore, from this day forward it shall read:

" 5.01 Termination in advance on the part of the Tenant

If at any time prior to the termination of the agreed term of this Agreement, the Tenant wishes to terminate the Agreement, it must provide prior written notice to the Landlord six (6) months in advance of the expected termination date. As compensation for the termination in advance of the Agreement, Tenant shall pay Landlord the totality of the monthly rental fees (total Rent) owed to complete the entire term of the lease agreement, as well as the entire Outstanding Fee and interest still pending. "

FIFTH : The execution of this Amendment does not affect the legal effect of any clauses of the Lease Agreement applicable to Leased Real Estate not specifically referred to in this Amendment. All provisions of the Lease Agreement not specifically referred to in this Amendment shall keep their full validity and effect.

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first above written.

Juan José Chacón Quirós

By: Establishment Labs S.A.

Tenant



/s/ Juan José Chacón Quirós
Juan José Chacón Quirós

By: Establishment Labs S.A.
Tenant



/s/ André Garnier Kruse		/s/ Álvaro Carballo Pinto
André Garnier Kruse		Álvaro Carballo Pinto

By: Zona Franca Coyol S. A.

Landlord

THIRD AMENDMENT TO LEASE AGREEMENT

Entered into at the city of San José, on the 7th day of the month of August of the year 2015, the "Effective Date" between:

ZONA FRANCA COYOL, S.A. , corporate identification card number three- one hundred one- four hundred and twenty thousand five hundred twelve (the "Landlord"), registered in the Mercantile Section of the Public Registry under book five hundred sixty, entry ten thousand three hundred and seventy nine, consecutive one, hereon represented by Álvaro Carballo Pinto, personal identity card number one - five hundred and thirty six - six hundred and fifty five, and Huber André Garnier Kruse, personal identity card number one- four hundred sixteen- one thousand three hundred forty four, acting jointly and with sufficient authority for the execution of this second amendment to the lease agreement, which legal representation is duly recorded in the Mercantile Section of the Public Registry under book five hundred and sixty five, entry eleven thousand five hundred and ninety two, consecutive one, as certified in Exhibit One.

For the one part and for the other,

Establishments Labs, S.A. , corporate identification card number three- one hundred one- three hundred and sixty nine thousand three hundred and thirty seven (the "Tenant"), registered in the Mercantile Section of the Public Registry under book five hundred seventy four, entry sixty six thousand three hundred and seventy nine, consecutive one, hereon represented by Juan José Chacón Quirós, with personal identity card number one - eight hundred twenty two- zero zero six, with sufficient authority for the execution of this third amendment of the lease agreement which legal representation is duly recorded in the Mercantile Section of the Public Registry under book two thousand and nine, entry two hundred twenty six thousand seven hundred and forty eight, consecutive one, as certified in Exhibit One.

Both, Landlord and Tenant jointly referred as "Parties"

Whereas

1. Whereas a Lease Agreement was executed on November 1 ^st , 2009, between Zona Franca Coyol as Landlord, and Establishment Labs S.A. as Tenant (previously "Establishment Biotec S.A."), for a period of one year ending on October 31 ^st , 2010.

2. Whereas the parties entered into a First Amendment to the Lease Agreement on July 31 ^st , 2010, extending the term of the lease until October 31 ^st , 2013.

3. Whereas the parties entered into a Second Amendment to the Lease Agreement on September 24 ^th , 2012, extending the term of the lease until October 31 ^st , 2015.

4. Whereas to Section 2.01 "Term of the Lease" of the Lease Agreement executed on November 1 ^st , 2009, the parties can extend the "Term of the Lease" by mutual written agreement.

5. Whereas Tenant provided to Landlord, a verbal request to extend the "Term of the Lease" as per section 2.01 "Term of the Lease" of the Lease Agreement.

6. Whereas Tenant as of July 6 ^th , 2015 is owing Landlord Rent, Park Services Fees, and parking space rental fees for a total amount of US$ 15.726,70 (fifteen thousand seven hundred and twenty six dollars with seventy cents), hereinafter the "outstanding fee". Such outstanding fee shall be honored by Tenant as per the Second Amendment terms.

Now, therefore in consideration of the foregoing and the mutual promises herein made, and in consideration of the representations, warranties, and covenants herein contained, the Parties have agreed to execute this Third Amendment to the Lease Agreement (hereinafter referred to as the "Third Amendment"):

2. Parties agree to modify subsection b) and c) of Section 2.00 "Rent", therefore, from this day on, such subsection b) and c) of Section 2.00 "Rent" shall be read as follows:

b) Tenant will also pay all condominium fees, including ordinary and extraordinary fees as provided by the Condominium General Assembly. Current Ordinary Condominium monthly fee has been established at the current rate of US$0.614 per leased square meter of construction area. The monthly ordinary fee is subject to changes established by the Condominium Owners General Assembly; Tenant must pay any increases in this ordinary condominium fee established by the Condominium Owners General Assembly and Landlord shall not indemnify Tenant in any form as a result of these increases. If such fee surpasses US$0.614 per leased square meter provided herein, it shall be increased equally.

c) Tenant will also pay any extraordinary condominium monthly fee as provided by the Condominium Owner's General Assembly at the rate established per leased square meter of construction area. Tenant must pay any increases in this extraordinary condominium fee established by the Condominium Owners General Assembly and Landlord shall not indemnify Tenant in any form as a result of these increases.

The Condominium fee includes the following services:

ii) Common Area Maintenance - CAM: a) cleaning of streets and Condominium common areas such as bus stops, sidewalks and common parking areas; b) maintenance of common gardens and green common areas (includes water fees only for these areas); c) Maintenance of original building's landscaping and green areas (any modifications or special requirements must be paid by the Tenant); d) access to wastewater treatment plant usage as per Wastewater Treatment Plant Usage Regulations; e) maintenance of sewer, potable and storm water pipes; f) general maintenance of infrastructure (sewer system, fiber

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optics and potable water system); h) Coordination service for exclusive bus transportation for the employees of the park.

The Condominium fee does not include the following services:

iii) Water consumption for Premises green areas is not included in Condominium Fee, Tenant shall be responsible for cost of its own water consumption including Premises irrigation system.

Garbage collection fee is not included in the Condominium fee; as a result garbage collection service has been established based on rented area of the Multitenant building by Tenant, which has been deemed as 4,78% of the total area of the Multitenant Building at the following monthly rate: US$30,00 for garbage container rent and US$516,00 for garbage collection service (based on a four week month), for a total of US$546,00 dollars. Tenant shall pay 4,78% of such billed amount on a monthly basis to Landlord on the same day of the rent payment. Garbage collection frequency might vary from month to month based on garbage container usage, as a result the previous amount is not a fixed monthly payment and it is used for reference based on a 4 week month with one collection per week per container. Garbage collection fee is established by Condominium Owners General Assembly and it's a service provided by the Condominium, not by Landlord.

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2. Parties agree to modify Section 2.01 "Term of the Lease", therefore, from this day on, such Section 2.01 "Term of the Lease" shall be read as follows:

a. " 2.01 Term of the Lease "

The term of the lease shall be effective as of the date of execution of the lease and until October 31 ^st , 2018 (the "Lease Term"), commencing on the Date of execution of the Lease. The parties acknowledge that the term of the Lease under the Lease Agreement and the First and Second Amendment will be unified for the additional term of the Lease Agreement. The Lease Agreement Term may be extended, or renewed further by written mutual agreement among the parties.

b. " 7.00 Communications and Notices "

All the notices that the Parties must exchange related to this Lease Agreement, will be sent in written form in which the delivery and receipt date must be clearly stated. The notices must be sent to the following addresses within working hours. The notices will be considered delivered on its date of receipt.


a. Landlord	At the administrative offices of Zona Franca Coyol, located at the administrative building of the Zona Franca Coyol. Fax number: (506) 2434 - 2470. With copy to Federico Castro, Fax number (506) 2201-0412


b. Tenant	At the leased area in Zona Franca Coyol, located at Coyol of Alajuela. Addressed to the Tenant's General Management.

3. The execution of this Third Amendment to the Lease Agreement does not affect the legal effect of any clauses of the Lease Agreement and the First and Second Amendment to the Lease Agreement not specifically referred to in this Amendment. All provisions of the Lease Agreement and the First and Second Amendment to the Lease Agreement not specifically referred to in this Amendment shall keep their full validity and effect.

4. Tenant agrees to provide Landlord with all contractual obligations such as but not limited to: guarantees, security deposit, insurance and others according to the Lease Agreement and the new "Lease Term" agreed among parties; such condition is a requirement for the validity of this Third Amendment.

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IN WITNESS THEREOF, the parties hereby agree to execute this Third Amendment to the Lease Agreement as of the 7th day of the month of August, 2015.



/s/ Juan José Chacón Quirós
Juan José Chacón Quirós

Date and Place:	August 10, 2015

By: Establishment Labs S.A.
Tenant



/s/ Álvaro Carballo Pinto			/s/ André Garnier Kruse
Álvaro Carballo Pinto			André Garnier Kruse

Date and Place:			Date and Place:

By/ Zona Franca Coyol S. A.
Landlord

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Exhibit One

Certificates of Incumbency

Exhibit 10.17

“CRISALIX OFFICIAL PARTNER” PILOT

PROGRAM AGREEMENT

BY AND BETWEEN

CRISALIX SA

AND

ESTABLISHMENT LABS S.A .

In Lausanne, on May 15 ^th , 2016.

1. THE PARTIES


1.1.	On the one part, Crisalix, SA (“Crisalix”), a company duly incorporated under the laws of Switzerland, with registered address at PSE-A, 1015 Lausanne, Switzerland. Crisalix is represented herein by Mr. Fabian Wyss, of legal age and of Swiss nationality, in his capacity as Manager of Crisalix.

1.2.

On the other part, Establishment Labs S.A. (“COP”) a company duly incorporated under the laws of Costa Rica, with registered address at B15, Coyol Free Zone, Alajuela, 20113, Costa Rica. COP is represented by Juan Jose Chacon Quires of legal age and of Costa Rican nationality and holder of ID number 1-0822-0006, in their capacity as CEO. For the purposes of this agreement, Crisalix and COP will be jointly referred to as the “Parties” and, individually, as the “Party”.

2. WHEREAS


1.3.	Crisalix is a company specialized in the advanced research and development of Services for pre-visualizing plastic and aesthetic surgery procedures and, as such, has developed an application called “Crisalix 3D” simulator (which is more fully described on www.crisalix.com/dr ), hereinafter referred to as “Services”,

addressed to the use of qualified physicians or members of the aesthetic, plastic and reconstructive surgical community in the Territory to assist them in showing their patients the outcome of plastic or aesthetic surgery procedures.


1.4.	Crisalix owns and possesses all the information and data relating to the operation of the Services and, likewise, all intellectual property rights whether registered or unregistered over the Services (the “IP Rights”).

1.5.

COP commercializes and provides mainly Motiva implants within the reconstructive and aesthetic surgery market, and represents to hold a market share of 3% of the international markets for breast implant products and, accordingly, has wide experience in this sector and the ability and capacity to fulfill the necessary requirements in order to fulfill the obligations arising from this Agreement (as defined below).

1.6.

The Parties have been engaged in negotiations with regard to, among others, the following: covering from the date hereof until September 1st, 2016, Crisalix appoints COP, subject to the relevant terms and conditions of this Agreement and to applicable regulations, as a “Crisalix Official Partner”, whose role will be to promote and market the Services in the geographical scope set out in clause 3.


1.7.	On the basis of the above recitals, the Parties recognize their mutual capacity to act hereunder and agree to execute this commercial partnership agreement (the “Agreement”), which will be governed by the following.

3. TERRITORY

The terms and conditions of this Agreement refer to COP promoting and marketing the Services in Spain, Italy, Bulgaria, Czech Republic, Turkey, Russia, Mexico, Argentina, Colombia, South Korea, hereinafter referred to as “Territory”. Outside the Territory, COP will not engage in or undertake any activities seeking to market or promote the Services, directly or indirectly, nor will it carry out any commercial transaction relating to the same.


1.8.	Should COP receive any request, solicitation or order for the Services from any third party outside the Territory, it shall promptly inform Crisalix who will be freely entitled to decide the most appropriate conditions to carry out, if at all, any commercial transaction with such third party.

4. PURPOSE

The purpose of this Agreement is, along with any attachments hereto, to set forth a contractual framework through which, in an effort to optimize patient satisfaction levels that ultimately increases COP’s client activity, COP is interested in offering the Services through a ‘Motiva Imagine” Program to its existing or potential clients and covering the related costs of subscription hereinafter referred to as “promoting and marketing”, within the Territory while complying with the provisions laid down in this Agreement. By offering the Services through the ‘Motiva Imagine” Program to its existing or potential clients, the objective is for COP to gain a competitive advantage by increasing patient satisfaction of above mentioned existing and potential clients, and in turn result in the promotion and sales of its own products to (i) maintain and strengthen COP’s client base in the Territory; (ii) maximize the purchase of COP’s products from existing clients; and (iii) build market share by attracting new clients to purchase COP’s products.

5. APPOINTMENT


1.9.	Crisalix appoints COP, which accepts, as a “Crisalix Official Partner” in the Territory until September 31 ^st , 2016 to promote and market the Services in the Territory under the terms and conditions of this Agreement.

6. OFFERINGS


1.10.	COP agrees that the covered costs of subscription to the Services shall be offered as defined in clause 12 (collectively, the “End Users”):


A.	Physicians, clinics, healthcare providers, or other, collectively referred to as “Physicians”, that operate in the Territory and that are COP’s clients as of today on either a regular or sporadic basis in the Territory (the “Existing End Users”);


B.	Any other Physicians or members of the aesthetic, plastic and reconstructive surgical community who are active in the aesthetic field and who are active in the Territory and become a COP’s client whilst this Agreement remains in force (the “Potential End Users”);

7. MARKETING AND PROMOTIONAL ACTIVITIES


1.11.	COP shall undertake all commercially reasonable efforts to promote and market the Services within the Territory, and at a minimum, take such steps as those indicated in the documentation provided by Crisalix to this effect (namely the ‘Crisalix Partner_Marketing Kit’).

1.12.

So as to carry out the contractual agreement and fulfill the relevant objectives, COP shall ensure that all COP employees, agents, representatives or advisors who, who are responsible, directly or indirectly, for promoting and marketing the Services, due to their responsibilities of generally marketing and promoting COP’s regular products, will be fully familiar with Crisalix’ Services and sales strategy, namely through the familiarity with the ‘Crisalix_ Partner_sales training’ document made available to COP by Crisalix. Crisalix can make available its staff to remotely train COP’s staff or contractors for this purpose. If training requires a personal presence COP will be responsible for the costs and expenses incurred.


1.13.	COP shall cooperate in promoting and marketing the Services in the Territory so as to extend its use within the Territory and, in any event, promote the good image and reputation of Crisalix and the Services in the Territory.

8. SPECIFIC EVENTS

In connection with all Specific Events, which include, but are not limited to, events related to congresses of national or local aesthetic societies or associations in the aesthetic, plastic and reconstructive surgical community, which are to take place in the Territory, COP shall carry out any necessary activities and efforts and incur all relevant costs to ensure Crisalix is duly represented by COP, and/or to organize for the presence of at least one Crisalix employee. COP shall take all reasonable measures to promote Crisalix during these Specific Events, such as, but not limited to, through COP’s stand/booth, lectures by participants and key speakers, banners, brochures/flyers, and presentation of Crisalix on TV screens.

9. GENERAL COVENANTS

1.14.

All promotional and marketing activities shall be consistent at all times with the marketing guidelines and policies provided by Crisalix. Likewise, COP shall ensure that any publicity or promotional activity in the market will strictly comply with the regulations applicable to publicity of health-related products in each relevant jurisdiction within the Territory. On top of this, COP shall refrain from advertising and / or offering the Services in a manner that may lead to any End user and/or any third party to confusion about the quality, content, price, use or any other characteristic inherent to the Services.


1.15.	Crisalix reserves the right to intervene in any marketing or promotional activity and propose any change to the same in order to enforce the above-mentioned principles. Any proposal put forward by Crisalix shall be binding vis-a-vis COP.

10. TERM

Agreement will come into effect as from the execution of this Agreement and for a period of 5 months, (unless the contract is terminated beforehand in accordance with its provisions). This Agreement will be reviewed & renewed by or when the Agreement is due to terminate as mentioned above.

11. BREAK-UP RIGHT

Any of the Parties will be entitled to terminate the Agreement early, other than for breach of the other party or other legal or contractual cause for termination, serving a one-month prior written notice to the other Party

12 JOINTLY AGREED QUANTITIES

Agreed quantity to be purchased during the Pilot by COP represents 100 licences:


-	50 Gold including 60 patients per year licenses


-	30 Gold including 100 patients per year licenses


-	20 Platinum licenses

13 FEES AND EXPENSES

Package Deposit


-	A non-refundable amount of 136,175 USD (corresponding to half of the licenses for the LATAM and South Korean market territories as defined in article 3)


-	as well as another 136,175 EUR (corresponding to half of the licenses for the European and Russian market territories as defined in article 3) is paid on the date hereof by wire transfer, with confirmation sent the same day and duly signed by the bank, as an advanced payment for the delivery of the technology or means to create the above mentioned reference codes.

For the sake of clarity, those two amounts are not refundable and, therefore, are independent from the number of subscriptions that COP may cause to be contracted during this Agreement.

14. INITIAL END USER FEE

COP Prices for the initial pilot are based on a following agreement where in case of successful pilot will strive to acquire another 900 licenses during the 12 months following this initial pilot agreement. Yearly license fee (the “Initial End User Fee”) amounting to 2,269 USD for the Gold “60 patients per year” package within LATAM or South Korea, 2,269 EUR for the Gold “60 patients per year” package within Europe and Russia, amounting to 2,919 USD for the Gold “100 patients per year” package within LATAM or South Korea, 2,919 EUR for the Gold “100 patients per year” package within Europe and Russia, amounting to 3,569 USD for the Platinum package within LATAM or South Korea, 3,569 EUR for the Platinum within Europe and Russia for each End User upon subscription to the Services.

15. EXCLUSIVE IN FAVOUR OF CRISALIX

During the term of the Agreement, COP grants an exclusivity in favor of Crisalix to promote and market the Services and, therefore, shall refrain from developing, promoting and marketing, directly or indirectly, any services that, due to their technical characteristics, intrinsic qualities, functionalities or use could potentially replace the use of the Services or compete with them, either directly or through a subsidiary, affiliate, or any other entity in which it is a member of the management body or a director and, in general, in any other indirect way. Excluded from the exclusivity and limitations imposed in this clause are the AX3 products manufactured by a subsidiary of COP, which employ device specific scanning solutions.

16. OBLIGATIONS OF COP

Without prejudice to any other obligation arising from this Agreement:


1.16.	COP represents and warrants, for the purposes of this Agreement and as this may be required by any applicable law, it has all necessary permits and authorizations required by the relevant healthcare and/or administrative authorities of the Territory in order to carry out its activities and to fulfill the obligations arising from this Agreement.


1.17.	COP undertakes to fulfill the obligations arising from this Agreement in accordance with good business practices and under the strict fulfillment of the regulations applicable in the Territory.

COP shall:

A. Submit to Crisalix by the 27 ^th of each calendar month an updated agreed country plan detailing the planned business and achieved business to date.

C. Notify Crisalix immediately if COP becomes aware of any illegal or unauthorized use of the Services or any actual, potential or suspected infringement of Crisalix’ Intellectual Property Rights.

17. INTELLECTUAL PROPERTY RIGHTS

Crisalix declares that the Services, their operation or use does not infringe any third party intellectual property rights and should hold harmless COP or any of the Services licensees in the event of a claim.

COP acknowledges that the Services (and their underlying software and know-how) have been created by Crisalix and that they are of its exclusive property. Furthermore, COP undertakes to refrain from registering, or requesting registration or recognition of any Intellectual Property Rights, hereinafter referred to as “IP Rights”, or any trade names, domain names, brands, logos or any other IP Rights that identify Crisalix or its Services in the Territory or outside of it.

Moreover:

1.18.

Except as expressly provided in this Agreement and for the limited purposes of its execution, this Agreement does not constitute the granting in favor of COP any license over the Services (and their underlying software and know-how) or any property of Crisalix. The fact that the subscription of End Users to the Services is incurred or sold by COP (i.e. paid on their behalf or sold to the surgeon) does not grant COP any license or right over the Services.


1.19.	COP is not authorized to use the trade names, domain names, brands, logos or any other IP Rights that identify Crisalix or its Services, except for when strictly necessary to fulfill the obligations arising from this Agreement, and should this be necessary, express written authorization from Crisalix will be required.

The provisions of this Clause shall survive the termination of this Agreement.

18. LEGAL RELATIONSHIP

The relationship between the Parties arising from this Agreement is a relationship between independent contractors. The Parties acknowledge that this Agreement does not create any type of labor, corporate, agency, or franchise relationship, between the Parties, and neither Party can act or introduce themselves to third parties as if this were the case. Consequently, COP will be exclusively liable towards its clients for any sale of any products or services whether or not they are sold concurrently by incurring the costs of subscription to the Services.

COP undertakes to release, indemnify and hold Crisalix harmless from any claim or liability in connection with any claim against Crisalix in the event of a breach by COP of any of its obligations under this Agreement or with any claim deriving from the business relationship with COP’s clients.

19. TERMINATION

Other than as provided in Clause 10. above, either party may terminate this Agreement in the event of a breach of this Agreement by the other party. In such event, the aggrieved Party shall communicate the dispute to the other Party. Should the breaching Party not cure the breach within ten (10) days following receipt of such communication, the aggrieved Party will be entitled to terminate the Agreement without prejudice to any other right it may be entitled to in accordance with its terms.

In view of the above, Crisalix will also be entitled to terminate this Agreement if

COP does not comply with the payment schedule.


20.	USE OF IP RIGHTS OR KNOW HOW AFTER TERMINATION OF THE AGREEMENT

Once this Agreement is terminated (regardless of the cause), COP will be obliged to:

A. Refrain from using the denomination “Partner” or “Ex-Partner” in relation to Crisalix, and also, in all or in part, solely or jointly with any other distinctive signs, the name, brands, logos or other distinctive signs of Crisalix. Moreover, it will refrain from using any IP Rights, know how or other registered brands or distinctive signs that might create confusion or association with Crisalix, its distinctive signs or its products.

D. Immediately return to Crisalix all the catalogues, circulars, discs, handbooks, databases and, in general, any documentation created, developed or supplied by Crisalix in connection with the Services.

21. CONFIDENTIALITY


1.20.	Unless otherwise stated in this Agreement, all the information communicated by one Party to the other, prior or subsequent to the execution of this Agreement, in connection with its preparation or fulfillment, will be deemed confidential, and will only be used for the purposes of the Agreement (the “Confidential Information”).


1.21.	Other than as it may be required by law or injunction, the Parties will keep the Confidential Information secret and not communicate it to third parties without the prior written consent of the other Party.

1.22.

Other than as it may be required by law or injunction, each Party will endeavor that the Confidential Information is not disclosed to third parties, other than the employees, agents, representatives or advisors who need it in order to guarantee the adequate fulfillment of this Agreement or the fulfillment of their own tasks. All these persons must have expressly undertaken the confidentiality and secrecy obligations prior to being disclosed the Confidential Information.


1.23.	The obligations in this clause will remain in force even after the termination of the Agreement (regardless of its cause).

22. MISCELLANEOUS


1.24.	This Agreement replaces any other prior verbal or written agreement between the Parties regarding the same purpose and clauses of this Agreement.


1.25.	The Parties may not fully or partially assign this Agreement or the rights and obligations that arise from the same to third parties; unless the other Party’s prior consent is obtained. In any event, the assignment will imply that the assignor and the assignee will be jointly and severally liable towards each other for any issue arising from this Agreement.

1.26.

As an exception to the above, Crisalix may freely reorganize its corporate structure in order to optimize its international activities and may therefore assign all its rights and obligations hereunder to any existing or newly created entity, which remains under its shareholding and management control, or is a result of a merger or acquisition. Any such assignment shall be communicated to COP in order to be valid.


1.27.	Notifications between the Parties in connection with this Agreement may be made by post, e-mail or facsimile to the addresses mentioned in the headings of this Agreement. Notifications sent to such addresses will be deemed correct, unless the addressee has previously informed the counterparty of a change of address by certified post.


1.28.	Governing Law and Jurisdiction

This Agreement will be governed by Swiss law without regard to its conflict of law rules.

The Parties expressly waive their right to be heard before any other jurisdiction, and agree that any dispute between them which may directly or indirectly arise from this Agreement, including issues relating to its existence, validity, effectiveness, interpretation, fulfillment or termination, and the validity of this Clause, will be submitted to the jurisdiction of the courts of the city of Lausanne, Switzerland

As an expression of the Parties’ consent to this Agreement and the terms herein, the respective representatives initial each page and affix their signatures below.



Crisalix SA		Establishment Labs S.A.
P.p.		P.p.

/s/ Fabian Wyss		/s/ Juan José Chacón Quirós
Mr. Fabian Wyss		Mr. Juan José Chacón Quirós

THIS PAGE REPLACES THE ONE SIGNED INITIALLY ON 25 ^TH THAT DIDN’T INCLUDE THE CORRECT LIST OF COUNTRIES IN POINT 3 NEITHER THE CLAUSE 3.2

In Lausanne, on May 25 ^th , 2016.


1.	THE PARTIES


1.1	On the one part, Crisalix, SA (“Crisalix”), a company duly incorporated under the laws of Switzerland, with registered address at PSE-A, 1015 Lausanne, Switzerland. Crisalix is represented herein by Mr. Jaime Garcia, of legal age and of Spanish nationality, in his capacity as Manager of Crisalix.

1.2

On the other part, Establishment Labs S.A. (“COP”) a company duly incorporated under the laws of Costa Rica, with registered address at B15, Coyol Free Zone, Alajuela, 20113, Costa Rica COP is represented by Juan José Chacón Quirós of legal age and of Costa Rican nationality and holder of ID number 1-0822-0006, in their capacity as CEO. For the purposes of this agreement, Crisalix and COP will be jointly referred to as the “Parties” and, individually, as the “Party”.


2.	WHEREAS

2.1

Crisalix is a company specialized in the advanced research and development of Services for pre-visualizing plastic and aesthetic surgery procedures and, as such, has developed an application called “Crisalix 3D” simulator (which is more fully described on www.crisalix.com/dr ) hereinafter referred to as “Services”, addressed to the use of qualified physicians or members of the aesthetic, plastic and reconstructive surgical community in the Territory to assist them in showing their patients the outcome of plastic or aesthetic surgery procedures.


2.2	Crisalix owns and possesses all the information and data relating to the operation of the Services and, likewise, all intellectual property rights whether registered or unregistered over the Services (the “IP Rights”).

2.3

COP commercializes and provides mainly Motiva implants within the reconstructive and aesthetic surgery market, and represents to hold a market share of 3% of the the international markets for breast implant products and, accordingly, has wide experience in this sector and the ability and capacity to fulfill the necessary requirements in order to fulfill the obligations arising from this Agreement (as defined below).

2.4

The Parties have been engaged in negotiations with regard to, among others, the following: covering from the date hereof until September 31 ^st , 2016, Crisalix appoints COP, subject to the relevant terms and conditions of this Agreement and to applicable regulations, as a “Crisalix Official Partner”, whose role will be to promote and market the Services in the geographical scope set out in clause 3.


2.5	On the basis of the above recitals, the Parties recognize their mutual capacity to act hereunder and agree to execute this commercial partnership agreement (the “Agreement”), which will be governed by the following.


3.	TERRITORY

The teens and conditions of this Agreement refer to COP promoting and marketing the Services in Sweden, Austria, Finland — Esthonia — Lithuania, Portugal, Lebanon, Spain (Catalunia), Turkey, Russia, Mexico, South Korea and Costa Rica hereinafter referred to as “Territory”. Outside the Territory, COP will not engage in or undertake any activities seeking to market or promote the Services, directly or indirectly, nor will it carry out any commercial transaction relating to the same.


3.1	Should COP receive any request, solicitation or order for the Services from any third party outside the Territory, it shall promptly inform Crisalix who will be freely entitled to decide the most appropriate conditions to carry out, if at all, any commercial transaction with such third party.


3.2	Crisalix understands that during the pilot program it will not create exclusive deals in any territory that does not already have an exclusive arrangement, with a limit date of September 31 ^st , 2016. Both companies will strive to work together towards a comprehensive global deal during the pilot program.


4.	PURPOSE



Rockport Venture Securities		Invoice

Bill To:

Establishement Labs

Coyal Free Zone, 4th Street, Building B-1

Costa Rica

Juan Jose Chacon



Date	Invoice No.	P.O. Number	Terms	Project
04/07/16	474



Item	Description	Quantity	Rate	Amount
Placement Services	Private Placement Services		300,000.00	300,000.00
			Total	$300,000.00

Exhibit 10.18

JOINT INVENTION

(Worldwide Rights)

Attorney Docket No. 00127-0002-00600

ASSIGNMENT

WHEREAS We, the below named inventors, [hereinafter referred to as "Assignors"], have made an invention entitled:

SENSORS FOR IMPLANTABLE MEDICAL DEVICES AND METHODS OF USE THEREOF

for which We executed an application for United States Letters Patent filed in the U.S. Patent and Trademark Office (USPTO) filed concurrently herewith or identified by U.S. Provisional Application No. 62/313,218 filed on March 25, 2016; and

WHEREAS, ESTABLISHMENT LABS SA , a corporation of Costa Rica whose post office address is Coyol Free Zone, 4th St., Building B-15, La Garita, Alajuela 20113, COSTA RICA (hereinafter referred to as "Assignee"), is desirous of securing the entire right, title, and interest in and to this invention in all countries throughout the world, including the entire right, title, and interest in and to the above-referenced U.S. application and the United States Letters Patent to be issued upon this application or any application claiming priority to this application;

NOW THEREFORE, be it known that, for good and valuable consideration the receipt of which from Assignee is hereby acknowledged, We, as Assignors, have sold, assigned, transferred, and set over, and do hereby sell, assign, transfer, and set over unto the Assignee, its lawful successors and assigns, our entire right, title, and interest in and to this invention, the above-referenced U.S. application, and all non-provisional applications, and all divisions, and continuations thereof, and all Letters Patent of the United States which may be granted thereon, and all reissues thereof, and all rights to claim priority on the basis of the above-referenced U.S. application, and all applications for Letters Patent which may hereafter be filed for this invention in any foreign country, and all Letters Patent which may be granted on this invention in any foreign country, and all extensions, renewals, and reissues thereof; and We hereby authorize and request the Commissioner of Patents and Trademarks of the United States and any official of any foreign country whose duty it is to issue patents on applications as described above, to issue all Letters Patent for this invention to Assignee, its successors and assigns, in accordance with the terms of this Assignment;

AND, WE HEREBY covenant that We have the full right to convey the interest assigned by this Assignment, and We have not executed and will not execute any agreement in conflict with this Assignment;

AND, WE HEREBY further covenant and agree that We will, without further consideration, communicate with Assignee, its successors and assigns, any facts known to us respecting this invention, and testify in any legal proceeding, sign all lawful papers when called upon to do so, execute and deliver any and all papers that may be necessary or desirable to perfect the title to this invention in said Assignee, its successors or assigns, execute all non-provisional, divisional, continuation, and reissue applications, make all rightful oaths and generally do everything possible to aid Assignee, its successors and assigns, to obtain and enforce proper patent protection for this invention in the United States and any foreign country, it being understood that any expense incident to the execution of such papers shall be borne by the Assignee, its successors and assigns.

Page 1 of 2

JOINT INVENTION

(Worldwide Rights)

Attorney Docket No. 00127-0002-00600



County of	Hennepin	)	Name:	Randolph Keith GEISSLER
		)	Address:	410 Brockwood Drive
		)		Hudson, WI 54016, USA
State of	Minnesota	)	By:	/s/ Randolph Keith Geissler
			Date:	13 April, 2016

Subscribed and sworn to before me this 13 ^th day of April, 2016.
Randall E. Holscher, Notary Public



County of	)	Name:	Rudy A. MAZZOCCHI
	)	Address:	12168 NW 9 ^th Drive
	)		Coral Springs, FL 33071, USA
State of	)	By:	/s/ Rudy A. Mazzocchi
		Date:	14 September, 2016

Subscribed and sworn to before me this __ day of ________, 20__.
_____________, Notary Public


County of	)	Name:	Juan José Chacón QUIRÓS
	)	Address:	Coyol Free Zone, 4 ^th St., Building B-15
	)		La Garita, Alajuela 20113, COSTA RICA
State of	)	By:
		Date:	14 September, 2016

Subscribed and sworn to before me this __ day of ________, 20__.
_____________, Notary Public

Page 2 of 2

Exhibit 10.19

MANUFACTURING AND SUPPLY AGREEMENT

This Manufacturing and Supply Agreement (this “ Agreement ”) is entered into as of the Effective Date (as defined below) by and between (1) Apollo Endosurgery, Delaware corporation having offices at 1120 S Capital of Texas Highway #300, Austin, TX 78746 (“ APOLLO ”), and (2) Establishment Labs, S.A a corporation organized under the laws of Costa Rica and having a principal place of business at Coyol Free Zone, B15, Alajuela, 20113, Costa Rica (“ ESTABLISHMENT ”). APOLLO and ESTABLISHMENT shall hereinafter be individually referred to as a “ Party ” and collectively as the “ Parties .”

RECITALS


A.	APOLLO is engaged in the research and development, manufacture, distribution and marketing of certain medical devices.


B.	ESTABLISHMENT is engaged in the contract manufacturing and packaging of certain medical device products.


C.	APOLLO desires that ESTABLISHMENT be the manufacturer and supplier of the product(s) outlined on Exhibit A of this Agreement (“Product”) for APOLLO.


D.	APOLLO and ESTABLISHMENT desire to enter into this Agreement governing the supply of the Product upon the terms and conditions contained herein.

AGREEMENT

NOW THEREFORE, in consideration of the covenants contained herein, the above recitals, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:


1.	DEFINITIONS

1.1 “ Affiliates ” of a Party shall mean any corporation or other business entity controlling, controlled by, or under common control with such Party.

1.2 “ Certificate of Conformance ” or “ COC ” shall mean a document prepared by ESTABLISHMENT containing at a minimum: product name, Lot (defined below) number, lot quantity and a statement indicating compliance to all product specifications. Each COC shall be signature approved by ESTABLISHMENT’s Quality Assurance department.

1.3 “ Control ” (including “controlling”, “controlled by” and “under common control with” of any party, corporation, or other business entity) shall mean the direct or indirect ownership of at least fifty percent (50%) of the voting or income interest in such party, corporation, or other business entity, respectively.

1.4 “ Current Good Manufacturing Practices ” (abbreviated “ GMPs ” or “ cGMPs ”) shall mean, a) for any period during the Term during which ESTABLISHMENT has

received FDA certification, the standards established by the United States Food and Drug Administration (the “ FDA ”) for current Good Manufacturing Practices, as specified in FDA 21 C.F.R. §820 Quality Systems Regulations (or its successor provisions); and b) ISO 13485 Medical Devices - Quality Management Systems and other sections so designated by the title “Good Manufacturing Practices”; and c) as applicable to each respective Product to be manufactured and/or supplied by ESTABLISHMENT.

1.5 “ Effective Date ” shall mean December 5, 2014.

1.6 “ Facilities ” shall mean ESTABLISHMENT’s manufacturing facilities at Coyol Free Zone, B15, Alajuela, 20113, Costa Rica.

1.7 “ Lead Time ” shall mean the time period that begins on the day ESTABLISHMENT receives a Purchase Order (defined below) for Product from APOLLO and ends on the day ESTABLISHMENT is required to deliver the Product to APOLLO.

1.8 “ Lot ” shall mean a defined quantity of starting material, packaging material or product processed in one process or series of processes so that it could be expected to be homogeneous.

1.9 “ Product ” shall mean the product(s) to be manufactured and supplied by ESTABLISHMENT to APOLLO under Purchase Order(s) issued under this Agreement and as more specifically detailed in Exhibit A attached hereto.

1.10 “ Purchase Order ” shall mean a written purchase order issued to ESTABLISHMENT by APOLLO for the purchase of Product under this Agreement.

1.11 “ Span of Control ” shall mean all operational activities that are necessary to occur at ESTABLISHMENT and component suppliers, if any, that are related to the procurement and manufacture of the Product.

1.12 “ Specifications ” shall mean the Product specifications provided to ESTABLISHMENT by APOLLO. The Specifications shall include all necessary test protocols, packaging and labeling specifications, bills of materials and other documentation required to describe, control, and assure the quality of the manufacture of the Product.

1.13 “ WIP ” shall mean Work In Progress.


2.	TERM AND TERMINATION

2.1 Term . This Agreement shall commence on the Effective Date and shall be valid for a period of five (5) years with automatic renewal of one year thereafter until terminated by either party with one (1) year written notice prior to the expiration of the initial period or any extension period thereof.

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2.2 Termination .

(a) Either Party may terminate this Agreement (i) for material breach upon one hundred and twenty (120) days written notice specifying the nature of the breach, if such breach has not been substantially cured within the one hundred twenty (120) day period, or (ii) if the other Party shall formally declare bankruptcy, insolvency, reorganization, liquidation, or receivership; or is named in an action for bankruptcy, insolvency, reorganization, liquidation, or receivership proceedings, and fails to remove itself from such proceedings within ten (90) days from the date of institution of such proceedings.

(b) In the event this Agreement is terminated for reasons other than material breach by ESTABLISHMENT, APOLLO shall pay ESTABLISHMENT for all work, material purchases, WIP and finished goods performed pursuant to any unfinished Purchase Order(s) prior to such termination in addition to reparation charges outlined on Exhibit A of this Agreement.

(c) In the event this Agreement is terminated for any reason, ESTABLISHMENT shall promptly cease performing any work not necessary for the orderly close out of the affected Purchase Order(s) or for the fulfillment of regulatory requirements.

(d) Within thirty (30) days following the termination of this Agreement, and upon receiving payment for any outstanding invoices for previously fulfilled Purchase Orders, ESTABLISHMENT shall deliver to APOLLO all data and materials provided by APOLLO to ESTABLISHMENT for the manufacturing and supply activities under the impacted Purchase Order(s). Within this same timeframe APOLLO shall provide ESTABLISHMENT any reasonable compensation relative to work, materials, and WIP purchased specifically to support APOLLO’s Product. Termination of this Agreement, for any reason, shall not release either Party from liability which at said time has already incurred, nor affect in any way the survival of any rights, duties or obligations of either Party which are expressly stated elsewhere in this Agreement to survive termination. Without limiting the generality of the foregoing, the Parties agree that Sections 2.2 and Articles 6, 7, 8, 9, and 10 shall survive termination of this Agreement for any reason.


3.	MANUFACTURE AND SUPPLY OF PRODUCT

3.1 Performance Standards . ESTABLISHMENT shall manufacture the Product in accordance with the Specifications of this Agreement, and shall comply with all quality system requirement communicated by Apollo from time to time, ISO 13485:2012 and any applicable cGMPs and all other applicable local, United States or European regulations or laws in connection with the manufacture, testing, packaging, labeling, shipping, and handling of the Product.

(a) ESTABLISHMENT shall be responsible for normal and daily maintenance of all consigned equipment provided by APOLLO, as described in Exhibit C. APOLLO will be responsible for all other repair and/or replacement costs relating to loaned or consigned equipment due to normal wear and use. Unless otherwise agreed upon in writing, at

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APOLLO’s sole discretion, this equipment will be insured by APOLLO while located in ESTABLISHMENT’s manufacturing plants.

3.2 ESTABLISHMENT Representations . ESTABLISHMENT makes the following representations to APOLLO:

(a) ESTABLISHMENT is duly organized, validly existing and in good standing under the laws of Costa Rica. ESTABLISHMENT has all requisite power and authority to own, operate and lease its properties and to carry on its business as now conducted. ESTABLISHMENT has full corporate power and authority to execute, deliver and perform this Agreement; all corporate actions of ESTABLISHMENT necessary for such execution, delivery and performance have been duly taken; and this Agreement is a valid and binding obligation of ESTABLISHMENT.

ESTABLISHMENT shall perform all manufacturing, storage, handling, and testing of the Product(s) at the Facilities. ESTABLISHMENT warrants that the Facilities have been periodically inspected by its Notified Body’s representatives and auditors and/or any other required government agency and are in good standing with said governmental agencies, are fully compliant with ISO 13485:2012 and that all employees working on the Product whose responsibilities involve work which must be performed under ISO 13485:2012 standards have been properly trained in the requirements of those standards. ESTABLISHMENT additionally warrants that the Facilities hold all necessary licenses and permits from applicable local, national, and European regulatory bodies, required for the manufacture and testing of the Product and that all such licenses and permits are in full force and effect.

(b) ESTABLISHMENT shall comply with all applicable export and import control laws and regulations.

3.3 Suppliers . Except as otherwise agreed upon in writing ESTABLISHMENT assumes the responsibility for interacting with all chemical, component and packaging suppliers as required to deliver the Product in accordance with the applicable Purchase Order, including the Specifications, and this Agreement. Payment to the suppliers shall be handled directly by ESTABLISHMENT unless otherwise agreed upon in writing by APOLLO. ESTABLISHMENT shall not change its raw material, component or packaging materials without the prior written consent of APOLLO, which consent shall not be unreasonably withheld. With respect to the supply of the silicone raw materials for the shell and sheath product components, APOLLO shall acquire materials from a third party supplier and arrange for delivery to ESTABLISHMENT and ESTABLISHMENT shall be responsible for inspecting said components to ensure that they meet chemical, component and packaging specifications.


4.	PRICING AND PAYMENT; Fixtures and Tooling

4.1 Product Prices . Pricing for the Product ordered per the terms of this Agreement is set forth in Exhibit A attached hereto. Any penalty for failure to purchase a designated quantity of product for a defined period, if any, shall be clearly described in Exhibit A

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or in a written amendment. Any future modification to pricing shall be mutually agreed upon and may be captured in a revised Exhibit A or a written amendment signed by both Parties.

4.2 Payment Terms . Unless otherwise agreed to by ESTABLISHMENT in writing, ESTABLISHMENT shall invoice APOLLO for Product ordered at the time of shipment and APOLLO shall pay each invoice within thirty (30) days from date of invoice. Each invoice shall set forth, in U.S. Dollars, the applicable price for the shipment properly determined in accordance with the provisions of this Agreement. If APOLLO disputes any portion of an invoice received from ESTABLISHMENT the Parties shall use good faith efforts to reconcile the disputed amounts as soon as practicable. Invoices should be sent to the physical and email addresses as specified in writing by APOLLO in the applicable Purchase Order.

4.3 Fixtures and Tooling . In addition, Apollo will pay as set forth in Exhibit A for certain fixtures and tooling to be set forth in Exhibit C , and Apollo will maintain all right, title and interest in and to such fixtures and tooling. During the Term, fixtures and tooling will be identified to Apollo and will be subject to the requirements for ESTABLISHMENT to maintain set forth as part of the Services in Exhibit A . The parties will amend Exhibit C from time to time in writing to set forth an accurate list of such fixtures and tooling. With respect to all tooling and fixtures purchased by Apollo in connection with the manufacture and supply of Product and provision of Services hereunder and listed on Exhibit C (which, in accordance with this Agreement, Apollo shall retain all right, title and interest in and to), for so long as ESTABLISHMENT maintains possession of such tooling and fixtures, Establishment will retain, maintain and use such fixtures and tooling in the ordinary course of business (normal wear and tear excepted) consistent with its handling of other tooling and fixtures and will use such tooling and fixtures only for manufacturing and supply of Product and provision of Services to APOLLO as provided in this Agreement.


5.	FORECASTS, PURCHASE ORDERS AND DELIVERY

5.1 Forecasts . APOLLO shall provide ESTABLISHMENT on a monthly basis a twelve (12) month rolling forecast to allow for visibility into expected future demands. APOLLO shall deliver to ESTABLISHMENT a forecast for anticipated monthly deliveries of Product to APOLLO over the subsequent four (4) calendar quarters (the “ Forecast ”). The Forecast is to be used by the Parties for planning purposes and is not a commitment by APOLLO to purchase the quantities of Products specified in such Forecast, except as described below.

The quantities of Product forecasted for the initial three (3) months of each updated rolling Forecast shall represent a binding obligation of Apollo to purchase from ESTABLISHMENT, and of ESTABLISHMENT to manufacture and supply to APOLLO, such quantities of Product. ESTABLISHMENT shall, at all times during the Term, maintain an inventory of raw materials and components sufficient to manufacture the binding obligations.

5.2 Orders . APOLLO shall routinely provide ESTABLISHMENT Purchase Orders for Product demands. All Product ordered by APOLLO shall be in the form of a firm written Purchase Order. Each Purchase Order shall contain at a minimum, the following information: description of the Product and quantity ordered, price, freight carrier information,

- 5 -

payment terms, delivery date, and Purchase Order number for billing purposes. The Parties shall cooperate to establish appropriate lead times for orders; requested delivery dates shall provide sufficient lead times for the products ordered.

5.3 Delivery . Unless expressly provided otherwise in the applicable Purchase Order, shipping to APOLLO for the Product shall be Ex Works - ESTABLISHMENT (Incoterms 2010). The Product will be packaged and shipped per the Specifications and using a shipper and insurance coverage approved by APOLLO. In the event that any delivery of the Product is anticipated to be late, ESTABLISHMENT will promptly notify APOLLO of the circumstances for the delay and, upon request, ESTABLISHMENT will take reasonable steps to minimize the delay. At the request of APOLLO, ESTABLISHMENT will provide a written corrective action for the result of delays caused by events under the Span of Control of ESTABLISHMENT.

5.4 Acceptance, Rejection, and Claims . APOLLO may inspect any or all shipments of Product to insure all specifications are met including proper labeling, packaging and count within thirty (30) business days of APOLLO’s receipt of each shipment; however, any such inspection shall not relieve ESTABLISHMENT of any obligations or warranties under this Agreement. APOLLO has the right to reject, via written notification to ESTABLISHMENT within this thirty (30) day period, any or all of a shipment of Product that fails to satisfy any warranty in this Agreement and may reject all of a given Lot of Product if a statistical sample does not meet the Specifications. Upon confirmation of defective condition by ESTABLISHMENT and issuance of a return material authorization (“RMA”) number, APOLLO shall be entitled to the immediate return and replacement, free of charge, of any Product supplied by ESTABLISHMENT in breach of any warranty under this Agreement.

5.5 Spoilage Due to Change or Obsolescence . APOLLO shall be responsible for any printed packaging components, purchased raw materials, work in progress or finished Product which becomes obsolete as a result of a specification or drawing change so long as the purchased raw materials did not exceed three months of APOLLO’s forecast requirements and, upon Apollo’s request, such raw materials, work in progress and finished Product are transferred to APOLLO


6.	WARRANTIES

6.1 Product Warranty . ESTABLISHMENT warrants that all Product supplied under this Agreement shall, when it leaves ESTABLISHMENT’s possession and control, conform with the Specifications and shall be free from defects in materials and workmanship. ESTABLISHMENT further warrants that the Product shall be manufactured in accordance with applicable ISO 13485:2012 standards and with all applicable laws and regulations.

6.2 Debarment . ESTABLISHMENT represents, warrants and covenants that no person or entity that will be involved in the performance of ESTABLISHMENT’s obligations under this Agreement is under investigation by the FDA or other Regulatory Authority for debarment or is presently debarred by the FDA or other Regulatory Authority. In addition, ESTABLISHMENT represents and warrants that it has not engaged in any conduct or activity that could lead to any such debarment actions. If during the Term, ESTABLISHMENT or any

- 6 -

person or entity that will be involved in the performance of ESTABLISHMENT’s obligations under this Agreement (i) comes under investigation by the FDA for a debarment action, (ii) is debarred, or (iii) engages in any conduct or activity that could lead to debarment, ESTABLISHMENT shall notify APOLLO immediately after gaining knowledge of the situation.

6.3 Intellectual Property . ESTABLISHMENT represents, warrants and covenants to APOLLO that ESTABLISHMENT will not, in the course of performing obligations hereunder, infringe or misappropriate any intellectual property of any other person. APOLLO represents, warrants and covenants to ESTABLISHMENT that by complying with its obligations under this agreement APOLLO will not knowingly direct ESTABLISHMENT to incur any violation, infraction or misappropriation of any intellectual property of any other party.

6.4 Training . ESTABLISHMENT represents, warrants and covenants to APOLLO that all of its employees and personnel that will be performing any work in connection with this Agreement will have the appropriate training and skill necessary to perform their job functions.

6.5 No Conflicts . ESTABLISHMENT represents, warrants and covenants that it shall not enter into any agreement or arrangement with any other entity that would prevent or in any way negatively interfere with ESTABLISHMENT’s ability to perform it obligations hereunder.


7.	REGULATORY AND QUALITY

7.1 Compliance . ESTABLISHMENT agrees that its work under this Agreement will be conducted in compliance with all applicable laws, rules and regulations, and with the standard of care customary in the industry. If requested by APOLLO, ESTABLISHMENT shall provide APOLLO with a certificate evidencing its accreditation by the appropriate accrediting body. Such accreditation shall remain in force during the term of this Agreement. ESTABLISHMENT agrees that all Product shipments to APOLLO shall be in accordance with APOLLO’s instructions governing the shipment, labeling, and packaging of the Product.

7.2 Quality Control . Establishment shall maintain and follow a quality control and testing program consistent with the Product Specifications, ISO 13485:2012, Applicable Laws and quality system requirements communicated in writing by APOLLO from time to time (the “ Quality Control Procedures ”). All Product supplied to APOLLO hereunder shall be manufactured in compliance with ISO 13485:2012 and all other applicable requirements of Regulatory Authorities, and in compliance with all other Applicable Laws (collectively, “ Regulatory Standards ”). At all times the Products shall be manufactured in an ISO Class 7 Clean Room, unless otherwise set forth in an amendment to this Agreement or the Exhibits hereto signed by both Parties.

7.3 Records . Establishment shall keep complete, accurate and authentic accounts, notes, data and records pertaining to the manufacture, processing, testing, storage, and distribution of the Product, including without limitation master production and control records, in

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material compliance with applicable Regulatory Standards. Establishment shall use commercially reasonable efforts to maintain and store such records in a manner to prevent loss, theft or deterioration. Establishment shall retain such records for five (5) years following the date of manufacture, or such longer period of time if consistent with Regulatory Standards, and shall make available to Apollo copies of such records; and upon the expiration of such period, Establishment shall contact Apollo and give Apollo the option to have such quality control documentation transferred to Apollo or destroyed. Unless this Agreement is terminated by Apollo due to a Triggering Event, in which case APOLLO shall bear the following costs: (i) ESTABLISHMENT may charge APOLLO for ESTABLISHMENT actual, documented, reasonable labor expenses incurred by ESTABLISHMENT for transfer or destruction of such documents and (ii) in the event of transfer of documents all freight costs shall be borne by APOLLO.

7.4 Product Complaints/Reports . The parties expect that APOLLO shall receive any complaint, claim or adverse reaction report regarding the Product. However (and except as otherwise noted below) in the event that ESTABLISHMENT receives any complaint, claim or adverse reaction report regarding any Product, including, but not limited to, notices from a competent Regulatory Authority regarding any regulatory non-compliance of a Product, upon notice, ESTABLISHMENT shall within a reasonable time frame provide APOLLO with all information related to such complaint, report, or notice and such additional information regarding the Product as may be reasonably requested. ESTABLISHMENT shall provide as much information as it has, to allow APOLLO comply with the competent Regulatory Authority requirements for complaint handling. If Product contains a defect which could or did cause death or serious bodily injury, ESTABLISHMENT shall immediately provide APOLLO with a complete description of all relevant details known to ESTABLISHMENT concerning any such incident, including but not limited to, a description of any defect and such other information which may be necessary to report to the competent Regulatory Authority or any Ministry of Health. APOLLO is responsible for filing any/all MDR Reports as required by the competent Regulatory Authority.

7.5 Recalls . APOLLO shall have the right to reasonably declare any recall of, or field corrective action to, any Product supplied to APOLLO under this Agreement. ESTABLISHMENT agrees to cooperate with APOLLO in connection with any such recall inasmuch as related to its concern in the Product.

7.6 Government Inquiries . Without limiting the generality of Section 7.2, ESTABLISHMENT shall use its best efforts to:

(a) Respond fully and accurately to all inquiries directed to it by the competent Regulatory Authority or any government agency or regulatory body with respect to the manufacture and testing of the Product.

(b) Assist APOLLO in responding to inquiries directed to APOLLO by any competent Regulatory Authority or any government agency or regulatory body with respect to the manufacture and testing of the Product.

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7.7 Inspection of Manufacturing Facilities .

(a) ESTABLISHMENT shall permit APOLLO and its agents, during business hours and upon notice to ESTABLISHMENT, to inspect the Facilities where the Product is manufactured, handled, stored or tested, as well as all processes relating to the manufacture, handling, storage, or testing of the Product, as well as all test records regarding the Product.

7.8 ESTABLISHMENT warrants and agrees that it will correct within a reasonable amount of time from the date of notification, all deficiencies and/or non-conformances found during an APOLLO or any competent Regulatory Authority (regulatory body or agency) audit; and that it will take reasonable steps to correct such deficiencies and/or non-conformances or issue an approved plan, including a timetable, to correct all deficiencies and/or non-conformances within a reasonable time period.

7.9 Control Testing . ESTABLISHMENT shall perform quality control testing in accordance with the Specifications for release of each Lot of Product to APOLLO. Quality control testing shall include testing associated with the production of the Product, including, but not limited to, incoming component and raw material testing, in process testing, and final release testing as agreed upon from time to time between APOLLO and ESTABLISHMENT.

7.10 Specifications and Change Control .

(a) The Specifications may not be changed without prior written approval by APOLLO.

(b) ESTABLISHMENT shall not make any changes to the manufacturing process, Facilities, or equipment used in the manufacture that affects the form, fit or function of the Product without APOLLO’s prior written approval.

(c) APOLLO shall use commercially reasonable efforts to provide ESTABLISHMENT with sufficient written notice of any instructions or requirements of a government regulatory agency that may require a change of the Specifications. ESTABLISHMENT shall immediately notify APOLLO if any such changes in the Specifications shall render ESTABLISHMENT unable to supply the Product in accordance with the terms and conditions of this Agreement or if they would cause a delay in supply of the Product.

7.11 Technical Assistance . ESTABLISHMENT shall provide APOLLO with certain technical support regarding the Product as reasonably requested by APOLLO, including, but not limited to, analytical test methods, manufacturing process development, and validation support. If there are charges associated with these services, a separate quote will be provided to APOLLO.

7.12 Quality Agreement . ESTABLISHMENT and APOLLO shall execute a written Quality Agreement between the Parties (the “ Regulatory Agreement ”). Upon execution, the Quality Agreement shall be attached hereto as Exhibit B and shall be incorporated

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herein. The Quality Agreement may be updated from time to time upon the mutual written agreement of the Parties. ESTABLISHMENTs agrees to comply with any reasonable requirements of APOLLO’s quality system.


8.	INDEMNIFICATION, LIMITATION OF LIABILITY AND INSURANCE

8.1 Indemnification by APOLLO . APOLLO agrees to indemnify, defend and hold harmless ESTABLISHMENT, its officers, agents, and employees from any and all liability, loss (including reasonable attorneys’ fees) or damage they may suffer as the result of claims, demands, costs or judgments against them arising out of the negligence, recklessness or willful misconduct on the part of APOLLO, its officers, agents, employees, contractors or consultants in connection with this Agreement.

8.2 Indemnification by ESTABLISHMENT . ESTABLISHMENT agrees to indemnify, defend and hold harmless APOLLO, its officers, agents, and employees from any and all liability, loss (including reasonable attorneys’ fees), or damage they may suffer as the result of claims, demands, costs or judgments against them arising out of:

(a) a failure by ESTABLISHMENT, its officers, agents, employees, contractors or consultants to adhere to the terms of a Purchase Order or written instructions received from APOLLO in accordance with this agreement;

(b) negligence, recklessness or willful misconduct on the part of ESTABLISHMENT, its officers, agents, employees, contractors or consultants; or

(c) a breach of any applicable local law or regulation or of this Agreement by ESTABLISHMENT, its officers, agents, employees, contractors or consultants in relation to the execution of this agreement.

8.3 General Conditions of Indemnification . Each Party’s agreement to indemnify, defend and hold the other harmless is conditioned on the indemnified Party (i) providing written notice to the indemnifying Party of any claim, demand or action arising out of the indemnified activities within thirty (30) days after the indemnified Party has knowledge of such claim, demand or action; (ii) permitting the indemnifying Party to assume full responsibility to investigate, prepare for and defend against any such claim or demand; (iii) assisting the indemnifying Party, at the indemnifying Party’s reasonable expense, in the investigation of, preparation for and defense of any such claim or demand; and (iv) not compromising or settling such claim or demand without the indemnifying Party’s written consent; provided, however, that the failure of the indemnified Party to undertake any of the foregoing actions shall not relieve the indemnifying Party of any obligation it may have under this Article 8, except to the extent that the indemnifying Party’s ability to fulfill such obligation has been materially prejudiced thereby.

8.4 Limitation of Liability . EXCEPT FOR BREACHES OR VIOLATIONS OF ARTICLE 9, OR INDEMNITY LIABILITIES ARISING UNDER THIS ARTICLE 8, OR CASES OF GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY CONSEQUENTIAL, INDIRECT,

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SPECIAL, INCIDENTAL OR PUNITIVE DAMAGES INCLUDING LOSS OF USE, REVENUES OR PROFITS, INTERRUPTION OF BUSINESS OR CLAIMS AGAINST EITHER PARTY OR ITS CUSTOMERS BY ANY THIRD PARTY, WHETHER SUCH CLAIM IS BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR OTHERWISE, EVEN IF THE PARTY IS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

8.5 Insurance . ESTABLISHMENT, at its sole cost and expense, will maintain appropriate insurance including, but not limited to, Commercial General Liability Insurance with premises, operations coverage including Person Injury/Property Damage coverage, with limits of not less than $1,000,000 per occurrence. As of January 1, 2015, such insurance shall also have annual aggregate limits not less than $2,000,000. Evidence of insurance indicating such coverage will be delivered to APOLLO upon request. The evidence will (a) indicate that the policy will not change or terminate without at least fifteen (15) days prior written notice to APOLLO, (b) APOLLO shall be listed as an additional insured on the commercial general liability policy.


9.	CONFIDENTIALITY

9.1 Confidential Information . For purposes of this Agreement, “ Confidential Information ” shall mean all information relating to the subject matter of this Agreement (i) identified in written or oral format by the disclosing Party as confidential, trade secret or proprietary information and, if disclosed orally, summarized in written format within thirty (30) days of disclosure, or (ii) the receiving Party knows or has reason to know is confidential, trade secret or proprietary information of the disclosing Party. Notwithstanding the foregoing, “Confidential Information” shall not include any information which the receiving Party can show: (i) is now or subsequently becomes legally and publicly available without breach of this Agreement by the receiving Party, (ii) was rightfully in the possession of the receiving Party without any obligation of confidentiality prior to receiving it from the disclosing Party, (iii) was rightfully obtained by the receiving Party from a source other than the disclosing Party without any obligation of confidentiality, or (iv) was developed by or for the receiving Party independently and without reference to such information as shown by documentary evidence.

9.2 Nondisclosure . Each Party agrees not to use the Confidential Information of the other Party for any purpose, including trading in the financial instruments of the other Party, except in its performance under this Agreement. In addition, the receiving Party shall treat and protect such Confidential Information in the same manner as it treats its own information of like character, but with not less than reasonable care. The receiving Party agrees to take appropriate measures by instruction and/or written agreement prior to disclosure of Confidential Information to its employees and contractors to prevent unauthorized use or disclosure. Confidential Information may be disclosed to the extent necessary to comply with an order of an administrative agency or court of competent jurisdiction provided, however, that the Party so required to disclose Confidential Information shall provide prior written notice thereof to the other Party in sufficient time to enable that Party to seek a protective order or otherwise prevent such disclosure. The receiving Party’s confidentiality obligations under this Article 9 shall

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survive the termination of this Agreement, and shall remain binding on the Parties hereto until the earlier of a) the Confidential Information falls within one of the exceptions stated in Section 9.1 and b) five (5) years from the expiration or termination of the Agreement. Previously executed non-disclosure agreements between the Parties will remain in effect in conjunction with The Agreement until the termination dates specified in those agreements and any Confidential Information shall also be considered to be Confidential Information hereunder. Disclosure of Confidential Information under this Agreement will create no license, right, interest, or ownership in any such information in a receiving Party.


10.	GENERAL PROVISIONS

10.1 Relationship Between the Parties . In fulfilling its obligations pursuant to this Agreement, each Party shall be acting as an independent contractor. Neither Party is granted any right or authority to assume or to create any obligation or responsibility, express or implied, on behalf of or in the name of the other Party.

10.2 Nonexclusivity . Nothing in this Agreement shall limit or restrict Apollo from establishing a second source for the manufacture of the Products.

10.3 No Third Party Beneficiaries . This Agreement is neither expressly nor impliedly made for the benefit of any party other than those executing it.

10.4 Severability . If, for any reason, any part of this Agreement or any Purchase Order is adjudicated invalid, unenforceable or illegal by a court of competent jurisdiction, such provision will be changed and interpreted to accomplish the objectives of such provision to the greatest extent possible under applicable law and the remaining provisions of this Agreement or Purchase Order (as the case may be) will continue in full force and effect.

10.5 Notices . Any notice to be given under this Agreement must be in writing and delivered either in person, by any method of mail (postage prepaid) requiring return receipt, or by overnight courier, to the Party to be notified at its address(es) given below, or at any address such Party has previously designated by prior written notice to the other. Notice shall be presumptively deemed to be sufficiently given for all purposes upon the earlier of: (a) the date of actual receipt; (b) if mailed, three (3) calendar days after the date of postmark; or (c) if delivered by overnight courier, the next business day the overnight courier regularly makes deliveries.

If to ESTABLISHMENT:

Establishment Labs S.A.

Coyol Free Zone, B15, Alajuela

20113, Costa Rica

Attention: Luis Gutierrez. General Counsel

If to APOLLO:

Apollo Endosurgery, Inc.

1120 S. Capital of Texas Hwy, Suite 300

Austin, TX 78746

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Attn: Brian Szymczak, Legal Dept.

10.6 Force Majeure . Each Party shall be excused from liability for the failure or delay in performance of any obligation under this Agreement by reason of any event beyond such Party’s reasonable control, including, but not limited to, Acts of God, other natural forces or war. Such excuse from liability shall be effective only to the extent and duration of the event(s) causing the failure or delay in performance and provided that the Party seeking relief has not caused such event(s) to occur. Notice of a Party’s failure or delay in performance due to force majeure must be given to the other Party within three (3) calendar days after its occurrence. All delivery dates under this Agreement that have been affected by force majeure shall be tolled for the duration of such force majeure.

10.7 Legal Fees . The prevailing Party in any litigation between the Parties relating to this Agreement may be awarded some or all of its reasonable attorneys’ fees and court costs if the Court (in its reasonable discretion) finds that a non-prevailing party has not acted in good faith in the pursuit or defense of a claim hereunder, in addition to any other relief that it may be awarded.

10.8 Governing Law and Venue . Notwithstanding its place of execution or performance, this Agreement shall be governed by and construed in accordance with the laws of the State of Texas, irrespective of its laws regarding choice or conflict of laws. Any dispute arising under or relating to this Agreement shall be submitted for resolution to a state or federal court of competent jurisdiction in Austin, Texas, and the Parties hereby agree to submit to the jurisdiction and venue of such court.

10.9 Assignment . This Agreement is binding upon and inures to the benefit of the Parties to it, and to their successors and assigns. Neither Party shall have the right to assign this Agreement or any of its rights or obligations hereunder without the prior written consent of the other Party; provided, however, APOLLO may assign the Agreement to and may, without the prior consent of ESTABLISHMENT, assign all of its rights under this Agreement to (i) a parent or subsidiary of Apollo, (ii) a purchaser of all or substantially all the Apollo assets related to this Agreement, or (iii) a third party acquiring control of Apollo through a merger, acquisition, sale of assets or other corporate reorganization.

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IN WITNESS WHEREOF , the Parties hereto have executed this Agreement as of the Effective Date.



ESTABLISHMENT LABS, SA		Apollo Endosurgery, Inc.
By:	/s/ Juan Jose Chacon	By:	/s/ Todd Newton
Name:	Juan Jose Chacon	Name:	Todd Newton
Title:	CEO	Title:	CEO

EXHIBIT A

Product & Price Listing

[Intentionally Omitted]

Exhibit B

Regulatory Agreement

Establishment Labs

Apollo BIB Balloon and Sheath Testing & Inspection Proposal


1.	Manufacturing facility capabilities:


•	ISO Class 7 (ISO 14644-1:1999) - Certified clean room.


•	ISO 13485:2003 and ISO 9001:2008 Certified facility.


•	RDC#16:2013 Brazilian GMPs Approved facility.


•	SAP inventory levels remote consultation interface. Optional.


2.	Certificate of raw material conformance as per specification for all supplier lots of silicone dispersions, valve ring, slit valve and silicone adhesive:


•	Incoming inspection testing, as applicable:


◦	Appearance, viscosity, Shore A durometer value, tear strength, refractive index, supplier certificate review, tack free time, tensile strength, and elongation.


◦	Verification of Slit Valve functionality at incoming receiving.


•	Pre-process testing and statistical analysis report to comply with mechanical properties of the shell:


◦	Shell thickness lot analysis.


◦	Shell elongation and break force.


◦	Tensile set.


◦	Lot viscosity and devol time process parameters definition.


3.	Certificate of product conformance per lot, including:


•	Reference to Apollo/EL specifications drawing or Material Standard Specification.


•	EL Product Lot Number.


•	QTY description per lot.


•	Product Part Number and Description.


•	Raw Materials description with related documents including:


◦	Part number and supplier lot number.


◦	Supplier product certificates.


•	In process product testing controls, including:


◦	100% shell and Sheath thickness report.


◦	100% shell and Sheath visual inspection.


◦	100% assembly visual inspection.


◦	Sampling testing for shell elongation and break force.


◦	Sampling testing for patch-joint.


◦	Sampling testing tensile strength.


◦	100% leak test inspection of the balloon assembly.


•	DHR Review and QA approvals.


•	Other as required.


4.	Process engineering:


•	Manufacturing procedures engineering change orders managing and execution.


•	Process parameters improvement and DMR’s updating, if applicable.


•	Process data analysis.


•	Process Control Plans that identify Procedures, tooling, critical process controls, inspection requirements, inspection frequency, and inspection equipment.


5.	Digital back-up at Establishment Labs in accordance with Quality Standards of:


•	Raw material incoming inspection reports.


•	Pre-process testing reports.


•	DHRs for every lot number.


•	Lot processing parameters.


•	Clean room monitoring.


•	Equipment maintenance and calibration records.


•	Tensile tester testing raw data.


6.	Validations:


•	All processes that cannot be verified need to be validated.


7.	Quality System:


•	Must be updated to allow business as a contract manufacturer.


•	For Apollo product, updates should include but not limited to: customer related processes, customer audits, feedback, monitoring and measurement of product, management review, and analysis of non-conforming product.

Exhibit C

Fixtures and Tooling

Exhibit 10.20

ESTABLISHMENT LABS S.A.

AND

THE HOSPITAL GROUP

SUPPLY AGREEMENT

Supply Agreement

The following Supply Agreement is entered
BY AND BETWEEN :

ESTABLISHMENT LABS S.A. , a corporation organized under the laws of Costa Rica, having its registered office located in Zona Franca Coyol, Costa Rica, with company ID number 3-101-366337, (Hereinafter referred to as “ESTABLISHMENT”)

Represented by Juan Jose Chacan Quiros, CEO;

AND

THE PURCHASER, as defined in the previous Data Sheet

Hereinafter individually or collectively referred to as the “Parties”.

WITNESSETH

1. WHEREAS ESTABLISHMENT has developed and manufactures a range of mammary implants and related products under the trademark MOTIVA IMPLANT MATRIX ^® .

2. WHEREAS THE PURCHASER is willing to purchase MOTIVA IMPLANT MATRIX ^® products brand to be used in its facilities (as defined below – see article 1.15), all on the terms and under the conditions set forth below.

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

ARTICLE I - DEFINITIONS

As used in this Agreement, the singular shall include the plural and the plural shall include the singular, wherever so required by fact or context. Titles used in the articles hereof shall be only for the sake of convenience and shall not be regarded as a part of this Agreement. Exhibit means any exhibit to this Agreement, each of them being made an integral part hereof. As used in and for the sole purpose of this Agreement, and unless otherwise provided, the following terms shall have the meaning set forth below:

1.1 “ Affiliate ” shall mean any corporation or other business entity controlled by, controlling or under common control with a Party to this Agreement. For this purpose “control” shall mean (i) direct or indirect beneficial ownership of fifty percent (50%) or more of the voting stock, or (ii) a fifty percent (50%) or more interest in the income of such corporation or other business entity or (iii) direct or indirect power to direct or cause the direction of the management and policies by any means whatsoever.

1.2 “ Agreement ” shall mean the present purchase agreement.

1.3 “ Calendar Year ” means each twelve-month period starting on 1 January and ending 31 December.

1.4 “ Commercial Year ” shall mean each twelve (12) months’ period starting on the date of this agreement and ending on its anniversary.

1.5 “ Effective Date ” shall mean the date of signature of the Agreement.

1.6 “ Minimum Net Purchases ” shall mean the minimum Net Purchases (as hereinafter defined) EXW value (EDC) of Products as per ICC Incoterms (2000 Edition) that THE PURCHASER commits to attain each Commercial Year with ESTABLISHMENT, as indicated in Article 9 hereof.

1.7 “ Net Purchases ” shall mean the actual selling prices charged by ESTABLISHMENT to THE PURCHASER in bona fide, as per invoices covering the sales less all rebates, returns, trade and cash discounts and all taxes.

1.8 “ Product(s) ” shall collectively mean the MOTIVA IMPLANT MATRIX ^® range of breast implants and related products, conceived, developed and marketed by ESTABLISHMENT listed in EXHIBIT I (A). This shall also include any new MOTIVA IMPLANT MATRIX ^® product(s) that ESTABLISHMENT will decide to launch in the Territory;

1.9 “ Product(s) Price(s) ” shall mean the EXW EDC (Incoterms 2000) prices of Products, supplied by ESTABLISHMENT to THE PURCHASER, as determined from time to time in accordance with article 11.2 herein.

1.10 “ Physicians ” shall mean exclusively the physicians working in the PURCHASER’s facilities.

1.11 “ Quality Agreement ” means the document relating to the medical devices of the brand MOTIVA IMPLANT MATRIX ^® set out in EXHIBIT IV hereto.

1.12 “ Third Party ” means any party other than THE PURCHASER, ESTABLISHMENT or their respective Affiliates.

ARTICLE 2 – SUBJECT MATTER OF THE AGREEMENT

2.1 ESTABLISHMENT hereby grants THE PURCHASER which in turn accepts, the right to import, store into its warehouse sites located in the addresses indicated in the Data Sheet, promote, and employ the Products under the Trademarks through the Physicians in its facilities.

2.2 Subject to prior agreement between the Parties, with respect to specific commercial terms (such as Minimum Net Purchases, invoices and prices), this Agreement may be extended by an amendment to cover any new MOTIVA IMPLANT MATRIX ^® product launched by ESTABLISHMENT.

2.3 In consideration of the rights hereby granted, THE PURCHASER agrees to perform and be responsible for all operations of import, returns, traceability, and in general all operations relating to maintaining availability and the offering of the Products to the Physicians

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working at its facilities, in accordance with the terms and conditions of this Agreement and all medical rules and laws which may apply.

2.4 ESTABLISHMENT undertakes to meet THE PURCHASER’s requirements for the Products and to sell the Products to THE PURCHASER at the prices hereto agreed.

2.5 ESTABLISHMENT shall be entitled to:

2.5.1 Invoice THE PURCHASER upon shipment of the Products.

2.5.2 At any time and at its discretion, without the consent of THE PURCHASER, to make any change or introduce any modification, new presentation, enhancement or improvement to any of the Products; and/or introduce new additional or replacement Products; and such alteration in the products shall become Products for the purposes of this Agreement;

2.5.3 Whether or not requested by THE PURCHASER, at its sole discretion assist THE PURCHASER in promoting the sales of the Products.

2.6 THE PURCHASER undertakes and agrees with ESTABLISHMENT at all times during the term of this Agreement:

2.6.1 to pay in full and in Pounds (GBP) each invoice issued by ESTABLISHMENT within the term granted as indicated in the Data Sheet from the date of the invoice thereafter.

2.6.2 to use its best endeavors to promote the use of the Products by its patients and Physicians and any line extensions or new products within the range to ESTABLISHMENT’S satisfaction.

2.6.3 to employ or engage a sufficient number of suitably qualified personnel to ensure the proper fulfillment of THE PURCHASER’s obligations under this Agreement;

2.6.4 to maintain an inventory of the Products at levels which are appropriate and adequate to meet the demand;

2.6.5 to keep all stocks of the Products which it holds in conditions appropriate for their storage and to provide security for the Products all at its own cost and according to this Agreement;

2.6.6 to inform ESTABLISHMENT immediately of any change in its organization or method of doing business which may affect the performance of THE PURCHASER’s duties in this Agreement;

2.6.7 not to use or make reference to or authorize others to use or make reference to, ESTABLISHMENT’s name, emblems or symbols in relation to the Products in any

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manner whatsoever, save where approved by ESTABLISHMENT in the case of packaging requirements;

2.6.8 to fully and effectively indemnify ESTABLISHMENT for each breach by THE PURCHASER of any of the provision of this Agreement.

ARTICLE 3 –TERM

3.1 This Agreement will become effective as of the Effective Date and unless otherwise prematurely terminated as provided herein, shall remain in full force and effect for a term of three (3) Commercial Years, i.e. until the Final Date indicated in the Data Sheet.

3.2 Thereafter, unless otherwise terminated by any Party giving the other six (6) months’ prior notice before any expiry, this Agreement will be renewed for successive periods of three (3) Commercial Years.

ARTICLE 4 –TRADEMARKS

4.1 The Products will be exclusively marketed under the Trademarks. In addition, all packaging and documents will bear ESTABLISHMENT logo.

4.2 THE PURCHASER acknowledges the exclusive right, title and interest of ESTABLISHMENT or its Affiliate(s) in and to the Trademarks and to ESTABLISHMENT logo and will not do or cause to be done any act or thing contesting or, in any way, impairing or tending to impair any part of said right, title and interest, for the duration of this Agreement and after its expiry.

Furthermore, THE PURCHASER agrees not to register or acquire domain names which they know are identical or confusingly similar to the Trademark and/or the Logo or which include all or part of said Trademark and/or Logo for the duration of the Agreement and after its expiry.

4.3 THE PURCHASER shall notify ESTABLISHMENT promptly of any infringement of the Trademarks and ESTABLISHMENT logo and of any unfair competition coming to its attention. THE PURCHASER will not take any action either amicable or legal, and will let ESTABLISHMENT take any action suitable in its judgment providing that, at ESTABLISHMENT’s request, THE PURCHASER shall collaborate in said amicable or legal action taken by ESTABLISHMENT or its representative.

ARTICLE 5 –COMMERCIAL AND MARKETING POLICY

5.1 During the last semester of each Commercial Year, ESTABLISHMENT and THE PURCHASER will meet at mutually convenient time and place in order to define jointly the commercial and marketing and merchandising policy to be applied for the next Commercial Year, said policy shall take into consideration ESTABLISHMENT’s international strategy for such Products including ESTABLISHMENT’s international merchandising introduction strategy.

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5.2 THE PURCHASER agrees to employ the Products only through its clinics and qualified Physicians.

ARTICLE 6 –SALES PROMOTION AND ADVERTISING

6.1 As described hereinafter, every Commercial Year, THE PURCHASER will devote thereto an overall Budget as previously informed to ESTABLISHMENT for each Commercial Year.

6.2 The policy regarding media advertising and sales promotion will be mutually agreed each Commercial Year.

Regarding the merchandising policy, Products introduction should be performed by THE PURCHASER in accordance with ESTABLISHMENT’s merchandising recommendations as approved in the marketing plan.

6.3 In order to inform THE PURCHASER, ESTABLISHMENT may provide THE PURCHASER with samples of advertising material used in other territories. THE PURCHASER undertakes not to create and use any promotion material in whatever form and aid (such as internet) without ESTABLISHMENT’s prior written consent.

ARTICLE 7 –MINIMUM NET PURCHASES, SHIPMENTS AND PRICES

7.1 For the duration of this Agreement, THE PURCHASER agrees to achieve each Commercial Year the Minimum Net Purchases as indicated in the Data Sheet. The Minimum Net Purchases indicated for each year shall be divided by four to control progress during each quarter.

7.2 In case of non compliance during any Commercial Year, or during any quarter of such year, with any of the Minimum Net Purchases figures as indicated above, ESTABLISHMENT may increase or stop offering the special prices contained in the Agreement, and begin using the regular list prices for Europe for the Products, as indicated in 12.6 below.

7.3 In any Commercial Year of this Agreement, to the extent that THE PURCHASER’s non-compliance with the Minimum Net Purchases figures referred to above is due to ESTABLISHMENT’s failure to supply THE PURCHASER with Products on time and in full, such lost sales shall be included in any event in the calculation of the Minimum Net Purchases to be achieved in that Commercial Year by THE PURCHASER.

For the purposes of clarification, ESTABLISHMENT shall be entitled to deliver to PURCHASER plus or minus twenty per cent (20%) of all quantities of Products ordered by THE PURCHASER and account shall be taken of this fact in determining if ESTABLISHMENT has supplied THE PURCHASER with Product on time and in full in any given Commercial Year.

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ARTICLE 8 –PRICES AND SHIPMENTS

8.1 For the term of this Agreement, ESTABLISHMENT agrees to have THE PURCHASER supplied with, and THE PURCHASER agrees to buy from ESTABLISHMENT most of its requirements of the Products.

8.2

8.2.1 The Products will be supplied by ESTABLISHMENT, EXW EDC as per ICC Incoterms (2000 Edition) at the prices as indicated in EXHIBIT I hereto.

8.2.2 The Products Prices shall be maintained during the year of the Execution Date of this Agreement. Thereafter, said Products Prices shall be revised once every calendar year after mutual consultation, with variations being effective every January 1 ^st .

Market conditions, prices of the raw material as well as volume of business between the Parties shall be taken into account in establishing the Products Prices. Should on November 30 ^th at the latest no agreement be reached between the Parties hereto with respect to the level of said price increase, the prices of the Products will be increased only up to five per cent (5%).

8.2.3 Once the Products are delivered, THE PURCHASER undertakes to store them in its warehouses located as indicated in the Data Sheet, which warehouses complies with the storage conditions of the Products as described in the Exhibits.

8.3

8.3.1 Each invoice will be sent by ESTABLISHMENT to THE PURCHASER and will be paid by THE PURCHASER by bank transfer in Pounds within the term indicated in the Data Sheet from the date of the invoice, with a credit limit as indicated in the Data Sheet (hereinafter referred to as the “Authorized Facility”) unless otherwise agreed to in writing by the parties.

THE PURCHASER acknowledges and agrees that, during the term of the Agreement, the amount of the Authorized Facility, or the term granted for such credit, could be modified by ESTABLISHMENT, depending on the PURCHASER’s payment record or current market conditions.

8.3.2 In the event that THE PURCHASER desires to place an order of Products for an amount exceeding the Authorized Facility, THE PURCHASER shall obtain ESTABLISHMENT’s prior consent. In case of refusal, THE PURCHASER shall secure said new order providing ESTABLISHMENT with:


-	either a guaranty or bond in a form acceptable to ESTABLISHMENT, said guaranty to be maintained until the order concerned is fully paid;

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-	or a bank guarantee or letter of credit opened by a local first class bank confirmed by a first class bank acceptable to ESTABLISHMENT, said guaranty to be maintained until the order concerned is fully paid;


-	or prepayment of the order or the excess

8.4

8.4.1 Within ten (10) days from date of receipt, THE PURCHASER shall conduct a visual inspection of the Products delivered by ESTABLISHMENT for damage, defects or shortage. After such ten (10) days, if no notice to ESTABLISHMENT is made regarding damages, defects or shortage, the Products will be considered accepted by THE PURCHASER, provided however that in the event of latent defects of the Product not reasonably detected in connection with the visual inspection, THE PURCHASER shall notify ESTABLISHMENT promptly in writing upon detection thereof.

8.4.2 In the case where the inspection performed by THE PURCHASER indicates that the Products are damaged, defective or short in quantity, THE PURCHASER shall, at the time of notifying such non-conformity, provide ESTABLISHMENT, where relevant, with a sample of the damaged or defective Product.

8.4.3 Should ESTABLISHMENT agree with such results, and given that the damages are not the responsibility of the carrier, ESTABLISHMENT shall replace damaged or defective Products or make up shortfalls in the quantity of Products at the earliest possible time.

For the purpose of this clause 8.4.3, ESTABLISHMENT’s liability for delivering Products found to be damaged, defective or short of quantity shall be limited to replacement of the said Products, and only when there is no liability from the carrier and it is not covered by the fright insurance.

Notwithstanding the above, ESTABLISHMENT shall not be liable to replace damaged or defective Product unless such damage or defect in the Product is directly attributable to ESTABLISHMENT (therefore excluding cases such as damage during principal transportation, delays in customs clearing, bad storage conditions in THE PURCHASER warehouse(s) or any other cause beyond the control of ESTABLISHMENT). ESTABLISHMENT’s liability for damages occurred in transit shall be limited as per the EXW EDC, Incoterms 2000.

8.4.4 In the event that ESTABLISHMENT should not agree with THE PURCHASER that the Product is defective or that ESTABLISHMENT is responsible for the damage, the issue shall be submitted to an independent Third Party designated by mutual agreement whose decision shall be final. The costs arising from the intervention of the independent Third Party shall be borne by the Party in the wrong.

8.5 THE PURCHASER shall maintain at all times an inventory as needed to supply its doctors and related to the projected net purchases.

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8.6 THE PURCHASER undertakes to handle and store the Products manufactured in accordance with Good Manufacturing Practice (“GMP”) and according storage conditions, described in the exhibits.

8.7 In the event that any Product delivered to THE PURCHASER does not comply with ESTABLISHMENT’s warranty as set forth herein, ESTABLISHMENT hereby undertakes to replace such non-complying Product at its sole expense.

8.8 THE PURCHASER undertakes to distribute and employ the Products in conformity with the “FEFO - First Expiry - First Out” principle. THE PURCHASER agrees to be sole responsible of obsolete Products. ESTABLISHMENT will never ship, as part of the Products, medical devices with an expiry date less than twelve (12) months away from the shipping date.

8.9 In the event that there is a shortage of the Products for whatever reason, ESTABLISHMENT shall apportion supplies of the Products as it sees fit. ESTABLISHMENT shall use its reasonable endeavours to meet the delivery date specified in that order but time shall not be of the essence of this Agreement and, for the avoidance of doubt, ESTABLISHMENT shall not be liable to THE PURCHASER for any late delivery or non-delivery of the Products, as long as the delay is justified and not longer than 30 (thirty) days, under the penalty of incurring in loss and damages. Quantities not delivered as a consequence of a shortage shall be considered for the calculation of the Minimum Net Purchase.

8.10 All orders placed by THE PURCHASER in respect of the Products shall be either made in writing and sent to ESTABLISHMENT at an address specified by it from time to time or sent by electronic ordering if requested by ESTABLISHMENT and shall fall in line with the forecasts provided by THE PURCHASER

8.11 Any and all expenses, costs and charges incurred by THE PURCHASER in the performance of its obligations under this Agreement shall be paid by THE PURCHASER.

8.12 THE PURCHASER shall not be entitled by reason of any set-off, counter claim, abatement, or other similar deduction to withhold payment of any amount due to ESTABLISHMENT.

8.13 THE PURCHASER shall be responsible for the collection, remittance and payment of any or all taxes, charges, levies, assessments and other fees of any kind imposed by any governmental of other authority in respect of the purchase, importation, or sale of the Products.

8.14 All prices of the Products are exclusive of any applicable value added or any other sales tax for which THE PURCHASER may be additionally liable.

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8.15 If THE PURCHASER fails to pay any sums due to ESTABLISHMENT under this Agreement as they fall due, ESTABLISHMENT shall be entitled (without prejudice to any other right or remedy it may have) to:

8.15.1 Cancel or suspend any further delivery to THE PURCHASER under any order;

8.15.2 Charge THE PURCHASER interest on the outstanding sum at the rate of 4% of the total amount of the invoice concerned per month of delay, from the date the payment became due until actual payment is made, irrespective of whether the date of payment is before or after any judgement or award in respect of the same.

ARTICLE 9 –FORECAST

9.1 Upon the signature of the Agreement, THE PURCHASER shall provide ESTABLISHMENT with a written forecast containing those monthly quantities of Products that will presumably be ordered by THE PURCHASER and covering a period of twelve (12) months starting from the date of launch of the Products.

Every months, THE PURCHASER shall provide ESTABLISHMENT with a written revised forecast of its monthly requirements of Products for the period covering the next twelve (12) months.

Each order to be issued by THE PURCHASER shall be within the range of twenty per cent (20%) of its last forecast for the same time period.

9.2 Notwithstanding the foregoing, should THE PURCHASER require delivery of Products in excess of twenty per cent (20%) above those quantities stated in its last forecast for the same time period, ESTABLISHMENT agrees to use reasonable efforts to supply such additional quantities.

ARTICLE 10 –MATERIOVIGILANCE

THE PURCHASER shall keep ESTABLISHMENT informed on all reports of adverse events reactions coming from their knowledge with regard to the Products, regardless of their origin – the term « reports » shall also include publications.

Reports on such adverse reactions, which according to the informing party’s professional evaluation may negatively affect the benefit-risk ratio of the Product or may have consequences regarding the Product information (eg labelling, data sheets, package inserts) or may require immediate safety measures (such as special information / warnings to health professionals, patients, authorities or product withdrawal) shall be forwarded to the other Party without delay after becoming known.

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Exchange of materiovigilance information shall be addressed to :

For ESTABLISHMENT :

Quality, Regulatory and Materiovigilance Department:


Name company :	ESTABLISHMENT LABS S.A.


Address :	Bldg. 15, 4 ^th St. Zona Franca Coyol

Alajuela, Costa Rica

20113


Phone : Fax :	+(506).2434.2400

+(506).2434.2450

For THE PURCHASER : as indicated in the Data Sheet.

Or to such other address for each Party as may be notified from time to time.

ARTICLE 11 –PRODUCT RECALLS

If either Party determines that an event, incident or circumstance has occurred which may result in the need for a “recall” or “market withdrawal” (collectively referred to as “Recall”) of any Product used by THE PURCHASER, such Party shall advise and consult with the other Party regarding such event as set forth below:

11.1 Recall due to breach by THE PURCHASER

To the extent that the Recall of the Product is due to THE PURCHASER’s negligence or wilful misconduct, THE PURCHASER shall bear all out-of pocket costs and expenses of such Recall, including out-of-pocket costs incurred by Third Parties, the out-of-pocket costs of notifying customers and the out-of-pocket costs associated with shipment of such recalled Product and the costs and expenses of the necessary replacement and destruction of such Product which is removed from the market (the “Recall Expenses”).

11.2 Recall due to breach by ESTABLISHMENT

To the extent that the Recall is due to acts or conduct by ESTABLISHMENT, ESTABLISHMENT shall be responsible for the Recall Expenses.

11.3 Recall instituted by the Health Authorities of the Territory

In the event of a compulsory Recall at the behest of a Health Authority of the Territory there shall be no requirement for the Parties to agree on the need for such a Recall. The Parties shall however co-operate fully with one another in relation to such a Recall and the Recall Expenses shall be borne by the Parties in accordance with clauses 14.1 and 14.2 above.

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11.4 Procedure

Product recalls will be conducted in accordance with THE PURCHASER’s standard operating procedure on recalls which procedure shall be transmitted to ESTABLISHMENT at the latest on the Effective Date of the Agreement.

ARTICLE 12 –TERMINATION

12.1 This Agreement is entered into by ESTABLISHMENT in consideration of THE PURCHASER’s legal and financial situation on the Effective Date of this Agreement.

Consequently, any substantial modification of the situation, status or control of THE PURCHASER will have to be notified to ESTABLISHMENT within thirty (30) days from the date of such substantial modification, and ESTABLISHMENT will then have the right to terminate this Agreement upon a further sixty (60) days’ notice to THE PURCHASER.

In the absence of notification by THE PURCHASER, ESTABLISHMENT shall be entitled to exercise its right to terminate the Agreement as aforesaid whenever it has received sufficient evidence (through publication in media or otherwise) that THE PURCHASER’s situation, status or control has been substantially modified.

For purposes of this Agreement, the term “control” shall mean the power, directly or indirectly, to direct the management and / or policies of THE PURCHASER, whether through the ownership of voting share, by contract, by operation of law or otherwise.

12.2 This Agreement will terminate automatically without any prior notice nor indemnity to any Party in the event any proceeding is commenced by or against THE PURCHASER, seeking relief under any bankruptcy or insolvency law and if such proceeding be involuntary, it remains un-dismissed for thirty (30) days from the date of its filing by the competent authorities.

12.3 In the event that either Party shall violate any provisions of this Agreement, or shall default in the performance of any of its obligations hereunder, including the payment of any invoice on or before its agreed due-time according to the conditions set in the Data Sheet or anywhere else in this Agreement, the non-defaulting Party may, at its sole option, terminate this Agreement by giving written notice to the defaulting Party specifying said default and its intention to terminate and, unless said default shall be rectified by the defaulting Party within thirty (30) days of the notice given, this Agreement shall become terminated thirty (30) days after said notice is given, without any further notice.

12.4 The present Agreement may be terminated by either Party in case of Recall (as defined in this agreement) of the Product from the market due to a decision by the competent Health Authorities of such country.

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The said termination shall not become effective until ten (10) days after dispatch by the terminating Party of a registered letter with receipt explaining the reasons for the letter, to which a copy of the decision of the authorities is to be attached.

12.5 ESTABLISHMENT also reserves the right to terminate the present Agreement if it decides to stop the marketing of any of the Product(s) in the country where THE PURCHASER is located.

The said termination shall not become effective until thirty (30) days following dispatch by ESTABLISHMENT of a registered letter with receipt explaining its decision.

12.6 In case of non compliance during any Commercial Year with any of the Minimum Net Purchases figures as indicated above for two consecutive quarters, the parties shall have a meeting within the next thirty days to negotiate new prices for the products, since the prices granted in the agreement to PURCHASER are based on the volume agreed as minimum purchases. If the Parties don’t meet or cannot reach an agreement, ESTABLISHMENT may continue charging its regular list prices for the Products on the following orders.

ARTICLE 13 –CONSEQUENCES OF EXPIRATION OR OF TERMINATION

13.1 Expiry of the term or termination of this Agreement by either Party, shall not relieve the Parties hereto of any obligation accruing prior to such termination.

13.2 Neither Party shall be entitled to receive any indemnity or other compensation merely because this Agreement is not renewed beyond the original term or any renewal period.

13.3 Upon the expiry of the term or termination of this Agreement, whatever the cause and the date may be, THE PURCHASER agrees to cease all use of the Trademark(s) and ESTABLISHMENT Logo.

ARTICLE 14 –TRANSFER OF RIGHTS

The rights and obligations of THE PURCHASER under this Agreement, shall not be assignable or be sub-licensed except with the prior written consent of ESTABLISHMENT.

The supply obligations of ESTABLISHMENT shall-be fulfilled by its local distributor: Aesthetic Healthcare Ltd. If for any reason Aesthetic Healthcare Ltd. stops being the local distributor of ESTABLISHMENT or becomes unable to comply with its obligations, ESTABLISHMENT shall comply with the supply obligations directly, including claims. All warranty obligations shall be kept at all times by ESTABLISHMENT, except for the submittal and reception of documents, all of which shall be transferred to the local distributor.

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ARTICLE 15 –GENERAL PROVISIONS

15.1 Independent Contractor

For the performance of this Agreement, THE PURCHASER will act as an independent contractor and not as an agent or representative of ESTABLISHMENT.

15.2 Product liability

(a) ESTABLISHMENT warrants that all Products delivered and sold to THE PURCHASER will be free from defects in material and workmanship at the time of delivery to THE PURCHASER. This warranty shall be effective per Product for the remaining shelf life of the Product.

(b) ESTABLISHMENT shall be responsible for, and shall indemnify and hold THE PURCHASER harmless from and against any damage, loss, cost or expense arising out of the claims made by final consumers of the Products in relation to defects in material or workmanship, insofar as these damages are not attributable to faulty handling of the Products by THE PURCHASER.

THE PURCHASER undertakes to inform ESTABLISHMENT of any such claims made by final consumers and not to take any action with respect thereto without ESTABLISHMENT’s prior written consent.

(c) All other guarantees, warranties, conditions and representations, either express or implied, whether arising under any statute, law, commercial usage or otherwise, including implied warranties of merchantability and fitness for a particular purpose relating to the Products, are hereby excluded to the fullest extent permitted by law.

Furthermore, under no circumstances shall ESTABLISHMENT be liable to THE PURCHASER for any indirect or consequential loss suffered or incurred by THE PURCHASER, howsoever arising.

(d) THE PURCHASER shall not make any warranties or representations with respect to the Products on behalf of ESTABLISHMENT except to the extent specifically provided in paragraph (b) above or to the extent of the product warranty for final users as published in ESTABLISHMENT website current at the time of purchase.

THE PURCHASER shall indemnify and hold ESTABLISHMENT harmless from all claims and damages, including attorney’s fees, resulting from THE PURCHASER’s violation of this provision of this Agreement.

(e) THE PURCHASER shall be responsible for, and shall indemnify and hold ESTABLISHMENT harmless from and against any damage, loss, cost or expense relating to Third Party claims or suits arising from the handling, storage, promotion and use of the Products unless such damages, loss, cost or expense is attributable to the Products supplied by ESTABLISHMENT, their properties and/or characteristics and/or any defect therein or non-

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compliance thereof with the relevant regulations in the country of the PURCHASER, and PROVIDING THAT upon receipt of notice by ESTABLISHMENT of any claims or suits, ESTABLISHMENT shall immediately notify THE PURCHASER thereof and at the cost and discretion of THE PURCHASER shall permit THE PURCHASER to handle such claims and suits.

(f) The Products have a warranty cover provided by ESTABLISHMENT, as indicated in EXHIBIT II hereto.

ARTICLE 16 –NON COMPETITION

For the duration of this Agreement, THE PURCHASER shall use its best efforts not to use and/or promote and/or sell and/or buy, directly or indirectly any other products liable to compete with the Products, as may be permitted by law and local regulations.

ARTICLE 17 –CONFIDENTIALITY

THE PURCHASER agrees to exercise due care to prevent that any confidential information (hereinafter “Information”) about the Products, including the international marketing strategy of ESTABLISHMENT received from ESTABLISHMENT prior or during the term of this Agreement, might be revealed or disclosed to Third Parties.

This obligation to confidentiality shall remain in full force and effect during the whole validity period of the present Agreement plus ten (10) years beginning from its term or termination whatever the cause or the date. However, the provisions of this Article 20 shall not apply to :


•	Information which at the time of disclosure, is part of the public knowledge,


•	Information which after disclosure, becomes part of the public knowledge through no fault of THE PURCHASER or of its employees,


•	Information which THE PURCHASER can establish by competent proof was in its possession prior to disclosure hereunder and was not acquired from ESTABLISHMENT or ESTABLISHMENT’s Affiliate, directly or indirectly, under a secrecy obligation,


•	Information which is subsequently obtained lawfully from a Third Party without any secrecy obligation.

ARTICLE 18 –FORCE MAJEURE

Neither THE PURCHASER nor ESTABLISHMENT shall be considered in default or be liable to the other Party for any delay in performance or non-performance caused by circumstances beyond the reasonable control of such Party, including but not limited to explosion, fire, flood, earthquake, war whether declared or not, accident, labour strike or labour disturbances, sabotage, order or decrees of any court or action of governmental authority;

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provided, however, that diligent efforts are made to resume performance as quickly as possible. Except as expressly provided elsewhere in this Agreement, if any event of force majeure continues for more than three (3) months, either Party may terminate this Agreement on giving a further three (3) months written notice to the other.

ARTICLE 19 –NOTICES

Any notice required or permitted to be given under this Agreement shall be deemed to have been sufficiently given if delivered personally, by courier or if sent by facsimile, addressed to the Party to be notified, at its address stated in this Agreement or at such other address as may hereafter be furnished in writing to the notifying party, and shall be deemed to have been served at the date of receipt in the case of personal delivery, or four days if delivered by courier and one (1) day after dispatch in the case of facsimile.

ARTICLE 20 –EXHIBITS

20.1 The exhibit I constitutes an integral part of the Agreement and must be respected by THE PURCHASER.

20.2 The said exhibit is as follows:


•	EXHIBIT I : LIST OF PRODUCTS AND PRICES

20.3 Given the frequent modifications of the exhibits planned hereafter, it is expressly agreed and understood between the Parties that the modified exhibits will come into effect as soon as they will be validly signed by the representatives of both Parties, regardless of the signature of a written amendment.

ARTICLE 21 –APPLICABLE LAW AND ARBITRATION

This Agreement shall be construed and the rights of the Parties hereto, shall be determined in accordance with the laws of Costa Rica.

All disputes or differences that could relate to, or derived from this Agreement, its execution, liquidation or interpretation; will be resolved in accordance with the following procedure: 1) The Parties shall be subject to mediation mechanism in accordance with the Rules of Mediation of the London Court of International Arbitration. If, within fifteen (15) working days from the request for mediation, the Parties have not reached a settlement agreement, the dispute or difference shall be settled by, 2) Arbitration in accordance with the Arbitration Rules of that Centre, whose rules the parties submit unconditionally. The Arbitral Tribunal shall consist of one (1) member, and must decide based on the law. The London Court of International Arbitration will be the institution responsible for administering the arbitration process.

ARTICLE 22 –ELECTION OF DOMICILE

The Parties declare that they have elected domicile at their offices, as indicated in this Agreement.

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ARTICLE 23 –COMPLETE AND FINAL UNDERSTANDING

23.1 This Agreement represents the complete and final understanding of the Parties hereto and replaces and supersedes all previously existing agreements and arrangements between the Parties hereto relating to the subject matter hereof.

23.2 This Agreement may not be changed orally but any and all modifications to this Agreement shall be made in writing and be subject of appropriate addenda.

23.3 Moreover, it is understood that in the event that any provision of this Agreement is declared void or unenforceable by a court or tribunal of competent jurisdiction, the other provisions hereof not so declared shall remain in full force and effect.

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed by their duly appointed representatives in two (2) original copies.

On the execution date indicated in the Data Sheet.



ESTABLISHMENT	THE PURCHASER

/s/ Juan Jose Chacon Quiros	/s/ David Ross

Director and CEO	CEO

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EXHIBIT I

LIST OF PRODUCTS AND PRICES

“MOTIVA IMPLANT MATRIX ^® ” products :

See attached.

EXHIBIT II

PRODUCT WARRANTY

See attached.



ESTABLISHMENT	THE PURCHASER


/s/ Juan Jose Chacon Quiros	/s/ David Ross

Director and CEO	CEO

Exhibit 21.1

SUBSIDIARIES OF ESTABLISHMENT LABS HOLDINGS INC.



Name of Subsidiary	Jurisdiction of Organization
Establishment Labs S.A.	Costa Rica

JAMM Technologies, Inc.	Delaware

Motiva USA LLC	Delaware

European Distribution Center Motiva BVBA	Belgium

Establishment Labs Brasil Produtos Para Saude Ltda.*	Brazil

Motiva Implants France SAS	France

JEN-Vault Ltd.	Switzerland

* European Distribution Center Motiva BVBA owns 99% of Establishment Labs Brasil Produtos Para Saude Ltda., with 1% owned by a local Brazilian party.

Exhibit 23.1

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM'S CONSENT

We consent to the inclusion in this Registration Statement of Establishment Labs Holdings, Inc. on Form S-1 of our report dated May 10, 2018, which includes an explanatory paragraph as to the Company’s ability to continue as a going concern, with respect to our audits of the consolidated financial statements of Establishment Labs Holdings, Inc. as of December 31, 2017 and 2016 and for the years ended December 31, 2017 and 2016, which report appears in the Prospectus, which is part of this Registration Statement. We also consent to the reference to our Firm under the heading “Experts in such Prospectus.

/s/ Marcum llp

Marcum llp

Irvine, CA

June 20, 2018