​ ​ ​ ​ ​ ​ ​ Master Agreement for Transitional Services ​ ​ relating to the deconsolidation of Fresenius Medical Care AG & Co. KGaA ​

(1)

▇▇▇▇▇▇▇▇▇ SE & Co. KGaA, a German partnership limited by shares (Kommanditgesellschaft auf Aktien) with registered office in Bad Homburg ▇. ▇. ▇▇▇▇, Germany, and registered with the commercial register (Handelsregister) of the local court (Amtsgericht) of Bad Homburg ▇. ▇. ▇▇▇▇, Germany, under registration number HRB 11852 (“FSE”); and

(2)

Fresenius Medical Care AG & Co. KGaA (now: Fresenius Medical Care AG), with registered office in Hof (Saale), Germany, and registered with the commercial register (Handelsregister) of the local court (Amtsgericht) of Hof (Saale), Germany, under registration number HRB 4019 (now: HRB 6841) (“FME”).

(A)

FSE and FME plan to deconsolidate FME Group from FSE Group by changing FME’s legal form from a partnership limited by shares (Kommanditgesellschaft auf Aktien) to the legal form of a stock corporation (Aktiengesellschaft) under German law (the “Conversion”). As a result of the Conversion, FME Group will be separated from FSE Group pursuant to, among others, that certain group separation agreement made between FSE and FME in connection with the Conversion (the “Group Separation Agreement”).

(B)

The Parties envisage that following completion of the Conversion the provision of certain services on a transitional basis will be required.

(C)

FSE and certain companies of FSE Group have agreed to provide or procure the provision of certain transitional services to FME and certain companies of FME Group, and FME and certain companies of the FME Group have agreed to provide or procure the provision of certain transitional services to FSE and certain companies of FSE Group as of the Conversion Effective Date, in accordance with and subject to the terms of this Master TSA.

1

Definitions and Interpretation

2

Structure and Individual TSAs

2.1

Master TSA and Individual TSAs

2.1.1

This Master TSA sets the framework for the delivery of the Services by the Service Providers to the Service Recipients.

2.1.2

Subject to Clause 2.2 (Conclusion of Individual TSAs), this Master TSA grants

(i)

FME the right to request from FSE the conclusion of agreements which provide for

(a)

the delivery of Services to FME itself; or

(b)

the delivery of Services to any other Service Recipient identified by FME in its request made to FSE for the conclusion of such agreement.

(ii)

FSE the right to request from FME the conclusion of agreements which provide for

(a)

the delivery of Services to FSE itself; or

(b)

the delivery of Services to any other Service Recipient identified by FSE in its request made to FME for the conclusion of such agreement.

2.2

Conclusion of Individual TSAs

2.2.1

Conclusion of Individual TSAs shall not unduly increase the efforts required by the Parties, the FSE Group companies and the FME Group companies in connection with the performance of the Individual TSAs compared to the effort associated with the performance of the corresponding service agreements in place prior to the Conversion Effective Date, subject to the adaption of Services to reflect (i) that the Individual Parties are no longer part of the same Group and (ii) organic development of the business of the Service Recipient.

2.2.2

An overview of the Individual TSAs concluded or envisaged to be concluded with effect from the Conversion Effective Date is attached as Master Schedule 3 (Envisaged Individual TSAs).

2.2.3

Omitted Services

(i)

In the event that within six (6) months after the Conversion Effective Date, a Party notifies the other Party of a service which is not included in the Individual TSA(s) to which a member of the notifying Party’s Group is a party, but was provided in the Reference Period to a member of the notifying Party’s Group by a member of the notified Party’s Group and, in each case such service:

(a)

has not been agreed to be excluded from the Services to be provided under any Individual TSA or otherwise constitutes an Excluded Service;

(b)

cannot reasonably (aa) be provided by the relevant member of the notifying Party’s Group or (bb) sourced by it from a third party on short notice;

(c)

is reasonably required by the relevant member of the notifying Party’s Group in order to continue to operate its business on substantially the same basis as it was operated prior to the Conversion Effective Date (including any organic development of the business); and

(d)

can be provided by the notified Party or its Affiliate without undue increase of effort, provided that Clause 2.2.1 shall apply mutatis mutandis;

(ii)

For each Omitted Service, the Parties shall agree on a Service Description substantially in the form as attached to the template Individual TSA in Master Schedule 2 (Template Individual TSA). Unless otherwise agreed by the Parties:

(a)

The Service Charge for the Omitted Service shall be equivalent to the fully allocated cost to the Service Provider of providing that Omitted Service (as such cost may vary from time to time during the term of the Master TSA) plus the margin required to comply with applicable Tax law and the transfer pricing policies of the Service Provider applicable from time to time (“Cost Plus Basis”);

(b)

the service levels achieved on average in the Reference Period shall be the benchmark for the negotiations on the Agreed Service Levels; and

(c)

the Service Term shall be the minimum period necessary for the Service Recipient to transition away from the Omitted Service and, unless otherwise agreed, not longer than the longest Service Term for any other Service provided by the same Service Provider.

(iii)

Once a Service Description and a corresponding Individual TSA is agreed for an Omitted Service, such Omitted Service shall be deemed a Service. As long as a Service Description for an Omitted Service or the corresponding Individual TSA is not agreed, the notified Party’s Group shall not be under an obligation to provide the requested Omitted Service.

(iv)

Clauses 2.2.6, 2.2.7 and 2.2.9 (Conclusion of Individual TSAs) shall apply accordingly.

2.2.4

In the event that FSE Group companies or FME Group companies contemplate to divest a (i) Service Recipient or Affiliated Recipient such that the Service Recipient or Affiliated Recipient ceases to be a member of the FSE Group or FME Group, respectively; or (ii) business of a Service Recipient or Affiliated Recipient that used Services, upon request of FSE (in case of a divestiture of an FSE Group company or business) or FME (in case of a divestiture of an FME Group company or business), FSE or FME, as applicable, shall continue to provide Services to the requesting Party’s Group for distribution to the divested company or business for a term of up to twelve (12) months but at maximum for the duration for which the relevant Service is to be provided to the requesting Party’s Group under the applicable Individual TSA, subject to agreement in good faith on terms and conditions on which such Services shall be continued to be provided and such amendments as are necessary to reflect that the divested company or business no longer is an Affiliate of FSE or FME, as applicable.

2.2.5

Following the receipt by FSE of a request by FME, and following the receipt by FME of a request by FSE, in each case according to Clause 2.1.2 (Master TSA and Individual TSA), for the conclusion of an Individual TSA, the Parties shall consult with each other in order to determine whether the principles agreed in this Clause 2.2 (Conclusion of Individual TSAs) are complied with by the request made for the conclusion of an Individual TSA. In making such determination the Parties shall take into account any Individual TSAs

(i)

already concluded on the basis of requests previously made by each of the Parties for the conclusion of Individual TSAs; and

(ii)

which are likely to be concluded due to foreseeable future requests of each of the Parties for the conclusion of Individual TSAs.

2.2.6

Each of the Parties shall – upon receipt of a request from the respective other Party for the conclusion of an Individual TSA pursuant to Clause 2.1.2 (Master TSA and Individual TSA) – have the right to identify one (1) or more Service Provider(s) for the conclusion of the pertinent Individual TSA(s) addressing such request. FSE shall execute or procure that the relevant Group company executes and FME shall execute or procure that the relevant Group company executes the Individual TSA.

2.2.7

This Master TSA does only provide for the conclusion of Individual TSAs. This Master TSA does not provide for an obligation to deliver any Services and to pay the Service Charges for the receipt of such Services. All Services shall only be provided by the respective Service Provider to the respective Service Recipient, and all Service Charges shall only be paid by the respective Service Recipient to the respective Service Provider, in accordance with the pertinent Individual TSA once entered into by such local parties (the “Individual Parties”).

2.2.8

FSE and FME may (in their discretion) agree that services other than Services (including Omitted Services) shall be provided (“Additional Service”). In such case Clauses 2.2.6, 2.2.7 and 2.2.9 (Conclusion of Individual TSAs) shall apply accordingly and once the respective Individual TSA is agreed for an Additional Service, such Additional Service shall be deemed a Service under the respective Individual TSA.

2.2.9

The Parties will update Master Schedule 3 (Envisaged Individual TSAs) in due course following the conclusion of an Individual TSA in accordance with the provisions of this Clause 2 (Structure and Individual TSAs).

2.3

Terms and Conditions for Individual TSAs

2.3.1

The terms and conditions of each Individual TSA concluded in accordance with the provisions of this Clause 2 (Structure and Individual TSAs) are set forth in Master Schedule 2 (Template Individual TSA).

2.3.2

If

(i)

FSE is not a party to an Individual TSA, FSE shall ensure – to the extent permitted by applicable law – that FSE Group companies only conclude and

(ii)

FME is not a party to an Individual TSA, FME shall ensure – to the extent permitted by applicable law – that FME Group companies only conclude and maintain Individual TSAs which essentially reflect the terms and conditions set forth in Master Schedule 2 (Template Individual TSA) respectively

2.3.3

The Services to be provided are described in each Individual TSA. The Individual TSAs also identify the relevant Service Provider(s) and the relevant Service Recipient(s) as well as (among others) the relevant Service Term, the Agreed Service Levels and the Service Charge.

2.4

Payment Factory Services

3

Services

3.1

Provision and Use of Services

3.1.1

The Service Provider shall provide each Service to the Service Recipient from the applicable Service Commencement Date for the duration of the relevant Service Term.

3.1.2

Each Service other than an Additional Service shall be provided substantially with the same scope, in substantially the same manner and format and up to substantially the same volumes as the existing service was most recently provided during the twelve (12) months period prior to the Conversion Effective Date (“Reference Period”), subject to such amendments as are necessary to reflect that the Service Recipient no longer is an Affiliate of the Service Provider.

3.1.3

The Service Recipient shall exclusively use the Services for the continuation of the business conducted by it prior to the Conversion Effective Date (including any organic development of the business) and not for any other business or purpose. To the extent expressly provided in the relevant Service Description, the Service Recipient shall be entitled to request provision of the Services under the relevant Service Description to the Service Recipient and all of the Service Recipient’s subsidiaries at the Conversion Effective Date, in each case to the extent services similar to such Services were most recently provided to them prior to the Conversion

3.2

Standard of Service

3.2.1

The Service Provider shall provide each Service

(i)

to the service standard and service levels explicitly set forth in the relevant Service Description (the “Agreed Service Levels”), unless the Individual TSA clearly states that the standard and service levels pursuant to Clause 3.2.1(ii) shall apply in addition to the Agreed Service Levels; or

(ii)

absent Agreed Service Levels

(a)

to the standard and service levels to which it was on average provided during the Reference Period; and

(b)

with the same standard of care as applied in its own business (Sorgfalt in eigenen Angelegenheiten).

3.2.2

The Parties acknowledge that the Service Provider is not a professional provider of services to unaffiliated third parties and, hence, does not have in place contingency and back-up resources as a professional provider would typically have and shall not be under an obligation to provide for Services or parts of Services that cannot be provided by the Service Provider due to resource constraints (e.g., due to sickness of or termination by Service Employees). The Service Provider shall (i) notify the Service Recipient of any resource constraints as soon as reasonably possible once the Service Provider becomes aware that the provision of Services may be affected; and (ii) use reasonable efforts (a) in accordance with past practice to avoid resource constraints (e.g., by planning annual leaves accordingly, and it being understood that (aa) the Service Provider is not obliged to procure, maintain or replace resources internally; (bb) where the Service Provider becomes aware that internal or external resources maintained by the Service Provider have or will become unavailable, the Parties shall in good faith agree on appropriate alternative arrangements, taking in particular into account whether it is more suitable in light of the provision of the affected Services and their Migration if the Service Provider or the Service Recipient replaces the resources and if the replacement should be made through internal or external resources; and (cc) any increase in cost due to the replacement of resources maintained by the Service Provider shall be borne by the Service Provider, unless the requirement to replace resources was caused by reasons other than the Service Provider’s material non-compliance with past practice) and (b) to mitigate any resource constraints.

3.2.3

The Service Provider shall ensure that, in connection with the allocation of resources and facilities used to perform the Services other than Additional Services as between

(i)

the Service Recipient and

(ii)

members of the Service Provider’s Group receiving similar services,

3.2.4

A Service Provider shall not be under an obligation to provide a Service, if and to the extent provision of the Service would infringe applicable law. Any disagreement whether provision of a Service would infringe applicable law shall be treated as a Dispute and resolved in accordance with Clause 14 (Dispute Resolution).

3.2.5

A Service Provider shall not be under an obligation to provide a Service, if and to the extent resources, which were used to provide similar services in the Reference Period, transfer to the Service Recipient or any of its Affiliates (before or after the Service Commencement Date).

3.3

FDT IT Services

4

Change Management

4.1

Unilateral Changes

4.1.1

wishes to make a Minor Change;

4.1.2

needs to make a change to a Service to ensure the proper security of its systems or its compliance with applicable law;

4.1.3

changes policies applicable to the Service or the way it provides services similar to Services to other members of the Service Provider’s Group, unless the change would have a not only immaterial adverse effect on the service standard and service levels; or

4.1.4

modifies or changes any hard- or software, or amends any system, used for rendering a Service, unless the modification or change not only immaterially adversely affects the Service provision or service standard and service levels,

4.2

Other Changes

5

Third Party Suppliers

5.1

Third Party Consents

5.1.1

The Service Provider shall use all reasonable endeavours to:

(i)

identify and obtain all necessary Third Party Consents; and

(ii)

maintain all such Third Party Consents during the relevant Service Term.

5.1.2

The Service Recipient shall provide the Service Provider with such reasonable assistance as the Service Provider may require obtaining the Third Party Consents, including reasonable assistance with negotiating the terms of consents with Third Party Suppliers.

5.1.3

The Service Recipient shall pay for any fees, costs or charges imposed by a Third Party Supplier for the provision of any such Third Party Consent (“Third Party Consent Costs”). The Service Provider shall notify the Service Recipient of the anticipated or known Third Party Consent Costs as soon as reasonably practicable and shall use reasonable efforts to minimise such Third Party Consent Costs.

5.1.4

At the request of the Service Recipient, the Service Provider shall provide an update on its progress in obtaining Third Party Consents and copies of the documentation evidencing a Third Party Consent.

5.2

Dependence on Third Parties

5.2.1

Where a Third Party Consent or Third Party Agreement is required in order for the Service Provider to provide, or procure the provision of, any element of the Services (a “Dependent Service Element”) and:

(i)

that Third Party Consent despite using reasonable efforts either: (a) has not been obtained by the Service Provider in accordance with Clause 5.1.1 (Third Party Consents); or (b) has expired or been terminated or been revoked; or

(ii)

that Third Party Agreement either

(a)

terminates other than as a result of a breach by the Service Provider of its obligations under the relevant Third Party Agreement or due to termination by the Service Provider; or

(b)

expires despite using reasonable efforts to maintain the relevant Third Party Agreement

5.2.2

If the Service Provider is excused from providing a Dependent Service Element pursuant to Clause 5.2.1 (Dependence on Third Parties), the Service Provider shall notify the Service Recipient as soon as reasonably practicable. Upon receiving such notice, the Service Recipient may require the Service Provider to use reasonable efforts to assist the Service Recipient to make alternative arrangements for the receipt of that element of the Services and use reasonable efforts to minimise any adverse impact on the Services resulting from such circumstances.

5.2.3

The cost of putting such alternative arrangements in place, and the Service Provider’s costs in assisting the Service Recipient to achieve the same under Clause 5.2.2 (Dependence on Third Parties) shall be borne by the Service Recipient.

5.2.4

If, and to the extent that, the Service Provider ceases to provide the Dependent Service Element, there shall be an equitable reduction in the Service Charges to reflect any cost savings to the Service Provider as a result of such cessation (if any).

5.3

Compliance with Third Party Consents and Third Party Agreements

5.3.1

comply with; and

5.3.2

not cause the Service Provider to be in breach of,

5.4

Relationship with Third Party Suppliers

6

Migration and Handover

6.1

Transfer Report

6.1.1

Unless otherwise agreed in an Individual TSA or otherwise agreed in writing, within ninety (90) calendar days from the Conversion Effective Date, either Party shall prepare a draft transfer report setting out the steps that the Party deems required to be taken by it as Service Recipient or the other Service Recipients belonging to its Group on one hand and the relevant Service Provider on the other hand to enable each of the Services to be transferred to a Successor Operator, which may include the allocation of assets, rights and contracts as well as the transfer of data and files (the “Migration”) by the end of the Service Term based on the migration steps set out in Master Schedule 6 (Envisaged Migration Steps) in relation to the respective Service, if any, and shall submit this plan at least in text form to the other Party.

6.1.2

Within thirty (30) calendar days of the draft transfer report being provided, the Parties shall meet (including by teleconference) to discuss and seek to agree in good faith the contents of the draft transfer report (including all required migration steps and the costs associated with the Migration of each Service).

6.1.3

The relevant Party shall procure that the relevant Service Provider(s) shall review the draft transfer report and provide comments within fifteen (15) calendar days of the meeting referenced in Clause 6.1.2 (Transfer Report). The Party that submitted the initial draft transfer report shall then issue a revised transfer report reflecting any reasonable comments made by the Service Provider(s) on the draft transfer report and the Parties shall agree in writing on the transfer report as soon as reasonably practical (the “Transfer Report”) and discuss in good faith the allocation of assets,

6.1.4

The Party belonging to the same Group as the Service Provider shall be obliged to agree in the Transfer Report to perform the required migration steps if such migration steps can reasonably only be performed by the Service Provider.

6.1.5

Without prejudice to the remainder of this Clause 6 (Migration), the Transfer Report shall include a right for the Service Provider to require each Service Recipient, at its cost, to remove any instances of software provided to them under this Master TSA which are installed on Service Recipient hardware no later than the date of termination of this Master TSA (or by such other time as is requested to be stipulated by the Service Provider in the Transfer Report).

6.1.6

Any disagreement over the content of the Transfer Report shall be treated as a Dispute and resolved in accordance with Clause 14 (Dispute Resolution).

6.2

Migration

6.2.1

Performance of Migration Tasks and Steps

(i)

The Service Provider and the Service Recipient shall perform the tasks and steps assigned to it in the most recent version of the Transfer Report to the extent they relate to the Migration of the Services provided under the Individual TSA. All tasks and steps, actions, measures and omissions required for Migration, which are not expressly assigned to the Service Provider in the Transfer Report shall be Migration tasks and steps, actions, measures and omissions to be performed by the Service Recipient.

(ii)

The Service Provider and the Service Recipient agree that the items handed over as part of the Migration are provided on an “as-is where-is” basis, i.e., as they are in the Service Provider’s possession or control, in their current or an agreed format and without any representation or warranty of any kind.

(iii)

If a Migration task or step has been performed by the Service Provider, upon request of the Service Provider, the Service Recipient shall confirm the performance by signing a certificate of performance substantially in the form of the draft certificate set forth in Master Schedule 10 (Form of Certificate of Performance) (each, a “Certificate of Performance”).

(iv)

The Service Provider shall not be under an obligation to perform any Migration tasks and steps, including ad-hoc support, if and to the extent the performance of such Migration tasks and steps would infringe applicable law. Any disagreement whether performance of a Migration task or step would infringe applicable law shall be treated as a Dispute and resolved in accordance with Clause 14 (Dispute Resolution).

6.2.2

Alignment and Migration Meetings

(i)

The Service Provider and the Service Recipient shall schedule up to two (2) alignment meetings with a to be agreed duration for each workstream by the dates set forth in the Transfer Report to align on the Migration process, review documents and address open questions. In these alignment meetings the Service Provider shall in particular explain the contents of the handover package for each applicable workstream.

(ii)

The Service Provider and the Service Recipient shall schedule formal handover meetings with a to be agreed duration for each workstream by the dates set forth in the Transfer Report to jointly check the contents of the handover package against the itemized list of data and files to be handed over. If the respective handover package includes all data and files to be handed over, the Service Recipient shall confirm the completeness and receipt by signing a certificate of receipt substantially in the form of the draft certificate set forth in Master Schedule 11 (Form of Certificate of Receipt) (each, a “Certificate of Receipt”), provided that the Parties rights and obligations regarding the transfer and access to Documents and data pursuant to Clauses 6.1 (Transfer of Documents and data) and 6.2 (Access to Documents (including data) and information, retention periods and provision of information) of the Group Separation Agreement remain unaffected and shall apply accordingly to the Service Provider and the Service Recipient if the Service Recipient did not notice missing files and data when issuing the certificate despite its reasonable efforts to check completeness. If the Service Recipient notices that the respective handover package does not include all data and files to be handed over, the Service Recipient shall make a written reservation on the respective Certificate of Receipt making reference to the specific missing data and files, but for the remainder confirm receipt. The Service Provider and the Service Recipient shall then schedule a formal follow up handover meeting, to which this Clause 6.2.2 (Alignment and Handover Meetings) shall apply accordingly.

(iii)

The Service Provider and the Service Recipient shall procure that the alignment meetings and handover meetings are attended by (internal or external) personnel with appropriate professional qualification (“Handover Personnel”). It is the Service Provider’s or the Service Recipient’s risk, as applicable, that the Handover Personnel attending the scheduled alignment meetings or handover meetings for the Service Provider or the Service Recipient, as applicable, is sufficiently qualified to take over the function under the workstream to be handed over.

6.2.3

Ad-hoc Support after Alignment and Handover Meetings

6.2.4

Clause 10.2.5(iv) (Limited Liability) shall not apply to the implementation of handover activities as part of the Migration, except (i) in case of incomplete handover of physical files or data (unless to the extent there would not be a handover obligation pursuant to clause 6.1.5 of the Group Separation Agreement applying by analogy mutatis mutandis) or (ii) handover of items other than on an “as-is” basis, i.e., as they are in the Service Provider’s possession or control, in their current or an agreed format. Clause 6.2 of the Group Separation Agreement shall remain unaffected and apply. Handover activities shall not, and shall not be deemed to, constitute advice. For the avoidance of doubt, any existing limitation of liability applicable to any advice provided by one Party to the other outside the context of the Migration shall not be affected hereby.

6.3

Cost of Migration Activities

6.3.1

Subject to Clause 6.3.2, the Service Recipient shall pay the Service Provider (i) for any external costs incurred in co-operating with the Service Recipient under this Clause 6 (Migration and Handover), provided that such costs were approved by the relevant Service Recipient in advance (further provided that such approval shall not be unreasonably withheld and the Service Provider shall not be obliged to incur any external costs in co-operating with the Service Recipient under this Clause 6 (Migration and Handover) if and to the extent such costs are not yet approved) and (ii) for any reasonable internal costs incurred in so cooperating with the Service Recipient (including ad-hoc support pursuant to Clause 6.2.3) in excess of the projected efforts (expressed in hours) set forth in Master Schedule 7 (Migration Cost Estimates) applying the relevant hourly rates set forth in Master Schedule 7 (Migration Cost Estimates). The Service Provider and the Service Recipient shall equally share all such costs charged to them or a member of their respective Group by FDT in relation to the Migration of Services other than FDT IT Services and excluding cost related to build up standalone solutions and capabilities for the target operating model of the Service Recipient. The aforementioned cost split shall only apply if the Individual Party demanding the cost to be split has obtained a reasonably detailed quotation from FDT and the other Individual Party has approved the engagement of FDT on the basis of such quotation. This cost split shall further not apply in respect of external resources which FDT engages for legal reasons or reasons of practicality, but which otherwise the relevant Service Recipient would have engaged. For the avoidance of doubt, Clauses 7.2 (Invoicing Procedures) to 7.8 (Withholding Tax) shall apply.

6.3.2

Clause 6.3 shall not apply with regard to any Migration activities in respect of SAP (for clarity, regardless under which Individual TSA and including under Individual TSA No. 1 (Corporate Finance/Global Treasury) and Individual TSA No. 7 (Regulatory)). The allocation of such costs shall be agreed separately between FSE and FME.

6.3.3

Unless otherwise agreed, the Parties agree that the cost relating to Migration activities incurred by a Service Recipient shall be borne by the Service Recipient.

7

Price and Payment

7.1

Pricing

7.1.1

The Service Recipient shall pay to the Service Provider the Service Charge in respect of the provision of each Service. Unless set forth otherwise in the Individual TSA, the Service Charge shall be determined on a Cost Plus Basis. To the extent the Service Charge is determined on a Cost Plus Basis, the Service Provider shall use reasonable efforts to minimize costs in accordance with past practice.

7.1.2

Where Service Charges are determined on a Cost Plus Basis the relevant cost shall be determined and allocated consistent with the principles applied prior to the Conversion Effective Date to such determination and allocation of cost for services similar to corresponding Services (e.g. if, prior to the Conversion Effective Date, the allocation of costs was determined on the basis of the number of employees of FME in relation to the number of employees of the entire FSE Group, this principle will be continued after the Conversion Effective Date and will not, by way of example, be changed to a cost determination on a time sheet basis).

7.1.3

Without prejudice to the obligation to reimburse Stranded Costs, the Service Charge for a Service shall cease to be payable if that Service is terminated. If a Service terminates part way through an invoicing period, there shall be a pro-rata adjustment to the Service Charge.

7.2

Invoicing Procedures

7.2.1

Unless otherwise stated in a Service Description (e.g., by stating that a Service Charge is a fixed fee or a lump sum payment), Service Charges are budgeted figures and shall be invoiced calendar monthly in arrears.

7.2.2

Where Service Charges invoiced are budgeted figures, after the relevant invoice based on budgeted figures was sent, the Service Provider shall, after the end of each month (or at such other frequency as agreed by the Parties in good faith), determine acting reasonably for each of the Services:

(i)

the actual consumption and costs of such Service; and

(ii)

whether the amounts invoiced by the Service Provider for such Services for the relevant period match, exceed or fall short of the sum of the Service Charges owed for such period.

7.2.3

If the Service Provider determines an excess in invoiced amounts in accordance with Clause 7.2.2(ii) (“Excess Amount”), the Service Provider shall credit the Excess Amount to the Service Recipient within thirty (30) calendar days after the determination of an Excess Amount by the Service Provider and issue a corresponding invoice.

7.2.4

If the Service Provider determines a shortfall in invoiced amounts in accordance with Clause 7.2.2(ii) (“Shortfall Amount”), the Service Recipient shall pay the Shortfall Amount to the Service Provider within thirty (30) calendar days of a corresponding invoice.

7.2.5

Unless set forth otherwise in the Individual TSA, Service Charges shall be invoiced in Euro.

7.2.6

The Service Provider shall send its invoices to the address of the Service Recipient specified in the relevant Individual TSA. The Service Provider shall, as further specified and on the basis of the principles set forth in Master Schedule 12 (Cost Breakdown), provide a cost breakdown which indicates the cost attributable to individual Affiliated Recipients (if applicable).

7.3

Payment Terms

7.4

Interest

7.5

No Right to Set-off

7.6

Stamp duties

7.7

VAT

7.7.1

All amounts payable under this Master TSA and any Individual TSA are each net amounts exclusive of any VAT. If any payment under this Master TSA or any Individual TSA constitutes the consideration for a taxable supply or service for VAT purposes (such supply or service being referred to as “VATable Supply”) and the provider of such VATable Supply is liable for such VAT vis-à-vis the competent Tax Authority according to applicable VAT law (or, as the case may be, the representative member of any VAT group of which it forms part), then the recipient of such VATable Supply shall – in addition to the payment of such consideration – pay an amount equal to such VAT. If any FME Group entity or FSE Group entity is the recipient of a VATable Supply, FME or FSE, as the case may be, shall procure that the respective FME Group entity or FSE Group entity, as the case may be, complies with the obligation stated in Clause 7.7.1 sentence 2. The payment of such amount equal to VAT shall only be due after a valid VAT invoice which complies with applicable law has been provided to the recipient of the VATable Supply. This Clause 7.7.1 shall not be affected by Clause 7.7.2 and shall rank senior to the provisions of Clause 7.7.2.

7.7.2

Where under the terms of this Master TSA or any Individual TSA, one Party is liable to indemnify or reimburse another Party in respect of costs, charges or expenses, the payment shall include an amount equal to any VAT thereon not otherwise recoverable by the other Party or the representative member of any VAT group of which it forms part, subject to that Party or the representative member using all reasonable endeavours to recover such amount of VAT as may be practicable.

7.8

Withholding Tax

7.8.1

All amounts payable under this Master TSA and any Individual TSA shall be paid free and clear of any Tax Deductions, unless a Tax Deduction is required by applicable law.

7.8.2

The Parties agree to use reasonable efforts to obtain any available exemptions or reductions with regard to any Tax Deductions, which shall include, for the avoidance of doubt, the cooperation in the completion of any procedural formalities necessary to obtain authorisation to make a payment under this Master TSA and any Individual TSA without a Tax Deduction, including the timely filing of any relevant Tax forms.

8

Obligations

8.1

Mutual Obligations

8.1.1

in the case of the Service Recipient, provide on a timely basis such information, decisions and data as the Service Provider may reasonably require for the purposes of the provision of the Services;

8.1.2

participate in discussions in good faith regarding the provision of the Services where reasonably required by the other Individual Party in order to facilitate decision making in relation to the Services;

8.1.3

in the case of the Service Recipient, notify the Service Provider on a timely basis of any failures or deficiencies in the provision of the Services under the relevant Individual TSA; and

8.1.4

in the case of the Service Recipient, maintain such operating environment as is required to allow the Service Provider to provide the Services under the relevant Individual TSA, including by maintaining the same location of Service receipt for the Term, unless otherwise agreed between the Parties in writing.

8.2

Security Obligations

8.2.1

The Service Provider shall, and the Service Recipient shall:

(i)

maintain reasonable security measures to protect the other’s systems from third parties, including from any virus or other software intended or designed to: (a) permit access to or use of information technology systems by a third person other than as expressly authorised; or (b) disable, damage, erase, disrupt or impair the normal operation of any information technology systems;

(ii)

not attempt to obtain access, use or interfere with any information technology systems or data belonging to the other Party except where required to do so to receive the Services (in the case of the Service Recipient), provide the Services (in the case of the Service Provider) or as otherwise permitted under the relevant Individual TSA; and

(iii)

have in place reasonable mechanisms designed to promptly detect anomalous activities and monitor their respective systems for security related ICT incidents, in particular cyber-attacks, and, upon obtaining knowledge of any of the following, notify the other Party of any breach of this Clause 8.2 (Security Obligations) or any other event relating to it that is likely to materially adversely affect the security of the other Individual Party’s systems, and shall act promptly to prevent or mitigate the effects of the breach and identify and implement reasonable steps to ensure that the breach does not reoccur.

8.2.2

Each Party may conduct security testing, including penetration testing, on the other Party’s information technology systems which connect to the conducting Party’s information technology systems up to four (4) times per calendar year provided that such Party provides details of the nature and scope of the testing at least twenty (20) Business Days in advance of that testing and makes such adjustments to the testing as are mutually agreed by the Chief Information Security Officers of the Parties and in respect of third party information technology systems such testing shall only be permissible to the extent allowed by the third party provider.

8.2.3

In case of a security related ICT incidents or if the Service Provider has reasonable grounds to assume that a security related ICT incident is on-going or imminent, the Service Provider shall be entitled to take reasonable and proportionate protective measures seeking to minimize the impact on the Parties, provided that the Service Provider may only suspend the Service Recipient’s access to or connection with the Service Provider’s systems or shut down the Service Provider’s systems (in whole or part), if such suspension or shutdown is implemented in a non-discriminatory way compared to other Service Provider’s Group companies, by way of example in the same way for Service Provider’s Group companies and Service Recipient’s Group companies, in case the affected systems are used by Service Provider’s Group companies and Service Recipient’s Group companies. The Service Provider shall not be liable for any failure to fulfil any of its duties hereunder as a result of taking measures in accordance with this Clause 8.2.3 (Security Obligations). Any liability of the Service Provider for the occurrence of the security related ICT incident (if any) remains unaffected.

8.3

Internal Controls

9

Term and Termination

9.1

Term

9.1.1

This Master TSA shall commence on the earlier of the Effective Date and the Service Commencement Date and, subject to earlier termination in accordance with its terms, shall terminate when the last Individual TSA is terminated or expires (the “Term”).

9.1.2

Each Service shall commence on the relevant Service Commencement Date.

9.1.3

Each Service will terminate at the end of the relevant Service Term.

9.1.4

The Parties may agree on the right to extend the Service Term in the relevant Individual TSA.

9.2

Service Termination by the Service Recipient

9.2.1

Subject to Clause 9.2.2 (Service Termination by the Service Recipient) and without prejudice to the timelines of the planned Migration and the Transfer Report relating to that Service, the Service Recipient may terminate a Service before the end of the relevant Service Term by written notice to the Service Provider:

(i)

at any time upon one (1) month’s notice; and

(ii)

in accordance with the early termination rights (if any) for that Service specified in the relevant Individual TSA.

9.2.2

Where in a Service Description it is specified that the provision of a Service covered by it (each, a “Dependent Service”) is dependent upon Services covered by one or more other Service Descriptions entered into by the same Individual Parties (each, a “Head Service”), the Dependent Service(s) shall be deemed terminated contemporaneously with the Head Services in case of termination of such Head Service for any reason, unless the respective Individual Parties agree otherwise. In all other cases termination of a Service shall not affect the remaining Services.

9.3

Service Termination by the Service Provider

9.4

Termination for Financial Distress

9.4.1

ceases to carry on its business or is dissolved or liquidated;

9.4.2

files or has filed against it a petition under any bankruptcy or insolvency law (including the opening of insolvency procedures or the rejection of the opening of insolvency procedures due to the lack of assets), or has a receiver appointed over all or substantially all of its assets;

9.4.3

becomes unable to pay its debts;

9.4.4

enters into liquidation (except for the purposes of a solvent amalgamation or reconstruction);

9.4.5

makes an arrangement with its creditors;

9.4.6

has a receiver, administrator or administrative receiver appointed over all or any of its assets;

9.4.7

takes or suffers to be taken any similar action in consequence of a debt; or

9.4.8

is subject to any procedure equivalent to any of the preceding matters in any other jurisdiction.

9.5

Information Obligation

9.6

Termination for Breach

9.6.1

A Party may terminate this Master TSA immediately by written notice to the other Party if that other Party commits a material breach of its obligations under this Master TSA and (where the breach is capable of being remedied) that breach has not been remedied within thirty (30) calendar days after receipt of written notice giving full

9.6.2

A Service Provider may terminate a Service immediately by written notice to the Service Recipient if that Service Recipient commits a material breach of its obligations under the relevant Individual TSA with regard to that Service and (where the breach is capable of being remedied) that breach has not been remedied within thirty (30) calendar days after receipt of written notice giving full particulars of the breach and requiring the Service Recipient to remedy it. In such event the Service Recipient shall be liable for any Stranded Costs.

9.6.3

A Service Recipient may terminate a Service immediately by written notice to the Service Provider if that Service Provider commits a material breach of its obligations under the relevant Individual TSA with regard to that Service and (where the breach is capable of being remedied) that breach has not been remedied within thirty (30) calendar days after receipt of written notice giving full particulars of the breach and requiring the Service Provider to remedy it.

9.7

Termination for Force Majeure

9.8

Non-Payment of the Service Charges

9.9

Termination for Cause

9.10

Stranded Costs

9.11

Survival of Rights on Termination or Expiry

9.11.1

Termination or expiry of this Master TSA shall not affect any rights or obligations which may have accrued prior to termination or expiry. The obligations of each Party set out in any Clause intended to survive such termination or expiry shall continue in full force and effect notwithstanding termination or expiry of this Master TSA.

9.11.2

In the event of a termination (Beendigung) of this Master TSA, the existing Individual TSAs shall remain unaffected, and the terms and conditions of this Master TSA shall apply to such existing Individual TSAs as if it were not terminated (beendet).

9.12

Equipment

9.13

Termination of Intercompany Agreements

10

Liability

10.1

Unlimited Liability

10.1.1

Either Party shall be liable to the other Party in connection with this Master TSA in accordance with statutory law without limitation for all damages which have been caused by wilful misconduct (Vorsatz) or gross negligence (▇▇▇▇▇ Fahrlässigkeit) by that Party, its legal representative or vicarious agent.

10.1.2

Furthermore, either Party shall be liable to the other Party in connection with this Master TSA for any negligent (fahrlässig) other than gross negligence (▇▇▇▇▇ Fahrlässigkeit) breach of contractual obligations which are essential as their fulfilment is necessary for the proper performance of this Master TSA and on the fulfilment of which the other Party may typically rely (regelmäßig vertrauen darf).

10.2

Limited Liability

10.2.1

If a Party is liable pursuant to Clause 10.1.2 (Unlimited Liability), its liability shall be limited to the foreseeable damage typically occurring under this Master TSA.

10.2.2

If a Party is liable pursuant to Clause 10.1.2 (Unlimited Liability) and Clause 10.2.1 (Limited Liability) its aggregate liability per Contract Year shall not exceed a maximum of EUR ten million (10,000,000.00) under this Master TSA in the Contract Year in which the damage or loss was caused.

10.2.3

To the extent a Service includes a Dependent Service Element the Service Provider’s liability for all damages which have been caused by such Dependent Service Element shall be limited to the compensation the Service Provider can actually recover from the relevant Third Party Supplier as equitably allocated between all recipients of the benefit of the relevant Third Party Agreement taking into account the damage occurred to them, provided that the Service Provider has used reasonable efforts to recover compensation under applicable law and the relevant Third Party Agreement.

10.2.4

Any other liability of a Party shall be excluded.

10.2.5

The above exclusions and limitations of liability shall not apply

(i)

in the event of injury to life, body or health;

(ii)

in case of a warranty or fraud;

(iii)

to claims asserted by a third party related to an (alleged) infringement of any Service Provider’s Intellectual Property Rights and New Service Provider’s Intellectual Property Rights which are made available by the Service Provider and licensed exclusively to such third party asserting an infringement;

(iv)

to claims and damages resulting from a breach of obligations of a Party regarding the Migration; and

(v)

to penalties and fines resulting from a breach of obligations of a Party regarding Taxes and social security contributions in connection with payroll Services.

10.2.6

Liability under the German Product Liability Act (Produkthaftungsgesetz) shall remain unaffected.

10.2.7

As far as the liability of a Party is excluded or limited pursuant to this Clause 10.2 (Limited Liability) or Clause 10.3 (Time Limitation), this shall also apply to the liability of its legal representatives, employees and vicarious agents.

10.2.8

Clauses 10.2.1, 10.2.2, 10.2.3, 10.2.4 (Limited Liability) shall not apply, if and to the extent the Third Party Agreement entitles the Service Provider to claim damages from a Third Party Provider that, as equitably allocated between all recipients of the benefit of the relevant Third Party Agreement taking into account the damage suffered by them, exceed, in scope or amount, the Service Recipient’s claims under the Individual TSA against the Service Provider (“Exceeding Claims”) and the Service Provider actually recovers such Exceeding Claims, provided that the Service Provider shall use reasonable efforts to recover Exceeding Claims to the extent possible under applicable law and the relevant Third Party Agreement.

10.3

Time Limitation

11

Insurance

12

Affiliated Recipients, centralized loss and parent company guarantee

12.1

Services to Affiliated Recipients

12.1.1

If in a Service Description it is agreed that the Service Recipient can request provision of a Service to Affiliated Recipients, then the Service Recipient shall procure that the relevant Affiliated Recipients comply with the Service Recipient’s

12.1.2

For clarity: A person, which is not a Party, shall not have an obligation under this Master TSA.

12.2

Centralized loss

12.2.1

The Parties agree that

(i)

Service Recipient shall procure that no Affiliated Recipient that is an Service Recipient’s Group company brings any claims, including claims for damages, arising under or in connection with Services or the relevant Individual TSA, against Service Provider or any Service Provider’s Group company without Service Provider’s consent and that claims for damages suffered by Service Recipient or an Service Recipient’s Group company arising under or in connection with Services or the relevant Individual TSA shall only be brought by Service Recipient by way of voluntary representative action (gewillkürte Prozessstandschaft);

(ii)

any infringement of rights, damage or other impairment suffered by an Affiliated Recipient that is a Service Recipient’s Group company shall be deemed an infringement of rights, damage or other impairment of Service Recipient for the purpose of Service Recipient bringing claims in accordance with Clause 12.2.1(i) (Centralized loss) (Drittschadensliquidation); and

(iii)

any infringement of rights, damage or other impairment caused by an Affiliated Recipient that is a Service Recipient’s Group company in connection with the receipt of Services or under or in connection with the relevant Individual TSA shall be deemed an infringement of rights, damage or other impairment caused by Service Recipient; and

(iv)

the liability of Service Provider in respect of damage suffered or caused by an Affiliated Recipient shall not exceed the liability that would exist in case an Individual TSA would have been entered into with such an Affiliated Recipient (e.g., for determining caps only the portion of the Service Charges fairly and equitably allocated to such Affiliated Recipient shall be relevant and not the Service Charges invoiced to the Service Recipient).

12.2.2

For clarity: In case of any infringement of rights, damage or other impairment caused by a Service Recipient’s Group Company attributed to Service Recipient pursuant to Clause 12.2.1(iv) (Centralized loss), Clause 10 (Liability) shall apply for the benefit of the Service Recipient.

12.2.3

A Party that is in non-compliance with Clause 12.2.1(i) (Centralized loss) shall (regardless of fault) indemnify and hold harmless the other Party and its respective Group companies against any loss of whatever nature incurred by them arising out of or in connection with any claims brought in non-compliance with Clauses 12.2.1(i) (Centralized loss). For the avoidance of doubt, Clause 10 (Liability) shall not apply to the preceding sentence.

12.3

Parent company guarantee

12.3.1

FSE guarantees upon first demand (auf erstes Anfordern) for the performance of all obligations of FSE Group Companies under or in connection with the relevant Individual TSAs. (i) To the extent the liability of the applicable FSE Group Company is limited, such limitation shall apply also to FSE as the guarantor; and (ii) if the liability of the applicable FSE Group Company is not subject to limitations, FSE as guarantor shall be liable to the same extent as the applicable FSE Group Company and no limitation of FSE’s liability set forth in this Agreement shall be read to limit FSE’s liability under this guarantee.

12.3.2

FME guarantees upon first demand (auf erstes Anfordern) for the performance of all obligations of the FME Group Companies under or in connection with the relevant Individual TSAs. (i) To the extent the liability of the applicable FME Group Company is limited, such limitation shall apply also to FME as the guarantor; and (ii) if the liability of the applicable FME Group Company is not subject to limitations, FME as guarantor shall be liable to the same extent as the applicable FME Group Company and no limitation of FME’s liability set forth in this Agreement shall be read to limit FME’s liability under this guarantee.

13

Governance

13.1

Relationship Managers

13.2

Meetings

13.2.1

considering any issues arising out of the performance of the Services or the Migration;

13.2.2

discussing the current status of any Changes; and

13.2.3

considering any other issues arising under or in connection with the Individual TSA.

14

Dispute Resolution

14.1

Amicable Resolution

14.1.1

through discussion following written notification thereof by their Relationship Managers; and

14.1.2

if they cannot resolve the Dispute within thirty (30) Business Days following written notification of the Dispute being raised, then the Dispute may be referred by either Party to the Chief Financial Officer of FSE and the Chief Financial Officer of FME; and

14.1.3

if, within fifteen (15) Business Days of the Dispute having been referred in accordance with Clause 14.1.2 (Amicable Resolution) no agreement has been reached, the dispute resolution process shall be deemed to have been exhausted in respect of the Dispute, and each Party shall be free to pursue the rights granted to it by this Master TSA in accordance with Clause 20.13.2 (Governing Law and Arbitration) in respect of such Dispute without further reference to the dispute resolution process.

14.2

Expedited Resolution

14.3

Interim Relief

15

Intellectual Property Rights

15.1

Service Provider’s Ownership and Licence

15.1.1

Subject to Clause 15.2 (Service Recipient Ownership and Licence), the Service Recipient agrees that as between the Parties, all Intellectual Property Rights that are developed or created by the Service Provider in the course of performing the Service Provider’s obligations under the relevant Individual TSA shall, upon development or creation, vest in and be owned exclusively by the Service Provider (“New Service Provider’s Intellectual Property”).

15.1.2

The Service Recipient shall have no interest or title to any Intellectual Property Rights which the Service Provider owns and, in the performance of its obligations under the relevant Individual TSA, makes available to the Service Recipient (“Service Provider’s Intellectual Property”).

15.1.3

Subject to obtaining the relevant Third Party Consents pursuant to Clause 5 (Third Party Suppliers), the Service Provider grants the Service Recipient a worldwide, royalty-free, irrevocable, non-exclusive, sub-licensable licence to use

(i)

the Service Provider’s Intellectual Property and New Service Provider’s Intellectual Property including any modifications, improvements and enhancements thereto, for the relevant Service Term solely for, and only to the extent necessary for, the receipt of the Services; and

(ii)

the Service Provider’s Intellectual Property and New Service Provider’s Intellectual Property which is incorporated in deliverables that are specifically created for the Service Recipient as part of the Services solely in conjunction with such deliverables after the Service Term.

15.2

Service Recipient’s Ownership and Licence

15.2.1

The Intellectual Property Rights in the Service Recipient Data shall at all times remain the sole property of, or vest in, the Service Recipient.

15.2.2

The Service Recipient shall grant a worldwide, non-exclusive, royalty free, irrevocable, non-transferable and sublicensable licence to the Service Provider to use the Service Recipient Data solely for, and only to the extent necessary for, the provision of the Services during the relevant Service Term.

16

Data Protection

16.1.1

The processing of personal data in connection with the Master TSA and the Individual TSAs is governed by Master Schedule 8 (Data Transfer Framework Agreement) (the “Data Transfer Framework Agreement”, “DTFA”).

16.1.2

Each Party hereby enters into the DTFA. Each Party will remain a party to the DTFA until the DTFA ends or a termination of the respective Party become effective. I.e., the terms of other agreements, such as this Master TSA or an Individual TSA, do not have any effect on whether a Party is a party to the DTFA. Any termination of the DTFA of a Party shall have effect for such Party respectively only and does not affect the effectiveness of the DTFA for its other parties.

16.1.3

The Parties undertake to conclude additional data protection agreements if and to the extent required according to the applicable data protection law.

16.1.4

The Parties hereby agree to the accession of FSE Group companies and FME Group companies to the DTFA.

17

Confidentiality

17.1

Duty of Confidentiality

17.2

Exceptions

(i)

the disclosure or use is required by law, any regulatory body or any stock exchange;

(ii)

the disclosure or use is reasonably required for the provision or receipt of the Services;

(iii)

the disclosure or use is required for the purpose of any judicial proceedings arising out of this Master TSA or any other agreement entered into under or pursuant to this Master TSA;

(iv)

the disclosure is made to a Tax Authority in connection with the Tax affairs of the disclosing Party;

(v)

the disclosure is made to professional advisers or actual or potential financiers of either Party on terms that such professional advisers or financiers undertake to comply with confidentiality obligations broadly equivalent to those set out in this Clause 17 (Confidentiality);

(vi)

the information is or becomes publicly available (other than by breach of this Master TSA or any other existing confidentiality obligation that prohibits the Party from disclosing such information to a third party);

(vii)

the other Party has given prior written approval to the disclosure or use;

(viii)

subject to applicable law and applicable competition law, in particular, the disclosure is made to an Affiliate;

(ix)

the disclosure is made to a third party service provider, provided such third party service provider is subject to confidentiality obligations not less onerous than these set forth in this Clause 17 (Confidentiality);

(x)

the disclosure is made by the statutory auditor team of a Party to the statutory auditor team of the other Party in the context of their audit duties to the extent there is a reasonable need of such statutory auditor team to obtain such information (need to know) and provided the members of the receiving auditor team undertake to comply with confidentiality obligations broadly equivalent to those set out in this Clause 17 (Confidentiality);

(xi)

the information is independently developed after the Conversion Effective Date,

17.3

Parties

17.4

Ringfencing of information

18

Force Majeure

18.1

No Liability

18.2

Termination Right

19

Employees

19.1

Responsibility for Employees and External Staff

19.1.1

For the time employees of the Service Provider are providing the Services to the Service Recipient under the relevant Individual TSA (“Service Employees”), the Service Employees will remain employees of the Service Provider, and nothing in such Individual TSA and no action taken by the Parties or the members of their respective Group pursuant to such Individual TSA or this Master TSA shall be construed or result in the Service Employees being deemed to be or become employees of the Service Recipient for any purpose.

19.1.2

For the time the Service Employees are assigned to providing the Services to the Service Recipient under the relevant Individual TSA, the Service Provider shall be solely responsible for the payment and provision of all wages, bonuses and commissions, employee benefits, including termination payments (including notably notice, severance and damages) and worker’s compensation, and the withholding and payment of applicable Taxes and social security contributions relating to such employment.

19.1.3

The Service Recipient undertakes to ensure that no instructions are given to the Service Employees and that the Service Employees are not integrated into the work organisation of the Service Recipient while providing the Services under the relevant Individual TSA. Instructions with regard to the provision of the Services shall only be communicated between the contact persons to be named at the Service Provider and the Service Recipient.

19.1.4

The Individual Parties shall without undue delay inform each other in writing (email sufficient) regarding any retention declarations of the Service Employees in accordance with section 9 of the German Temporary Employment Act (Arbeitnehmerüberlassungsgesetz) received by them, specifying who submitted such declaration and on what date. The Individual Parties will themselves take part

19.1.5

In case that the Service Provider makes use of external employees, contractors or other third parties (“Externs”) to provide Services to the Service Recipient under the relevant Individual TSA, the Parties acknowledge that the provisions agreed in respect to Service Employees in this Master TSA shall analogously also apply to Externs.

19.2

Transfer of Employees / Indemnification

19.2.1

According to the joint understanding of the Parties and the Individual Parties, no transfer of undertaking as per section 613a of the German Civil Code (Bürgerliches Gesetzbuch) or any other Transfer Regulations will occur with respect to the subject matter of the relevant Individual TSA either at its commencement, its performance or its termination. The Individual Parties undertake to take all reasonable measures in their respective areas of responsibility to avoid a legal transfer of employees at the commencement, performance or termination of the relevant Individual TSA.

19.2.2

If, despite the joint understanding and the Parties’ and the Individual Parties’ intention, (i) a Service Employee of the Service Provider or an Extern alleges, that the employment relationship of the Service Employee or Extern, or any liability in connection with the employment or its termination, has transferred to the Service Recipient under the Transfer Regulations, (ii) this transfer is confirmed by a court decision, and (iii) this transfer is a result (either directly or indirectly) of the commencement, performance or termination of the relevant Individual TSA the following shall apply:

(i)

To the extent that employees are transferred to the Service Recipient, the Service Recipient’s obligation to pay a Service Charge under the relevant Individual TSA to the Service Provider relating to the time from the transfer until the end of the relevant Individual TSA shall be reduced accordingly by the amount of total salary (incl. benefits and pension contributions) to the respective Service Employee that is included in the Service Charge; any Service Charges already paid and any amount of VAT related to or connected with such Service Charge paid in accordance with Clause 7.7.1 (VAT) shall be refunded by the Service Provider to the Service Recipient to that extent.

(ii)

The Service Recipient shall be solely liable for the future total salary (incl. benefits and pension entitlements) and the employment relationship for the time after the transfer; the Service Provider shall be solely liable for the total salary (incl. benefits and pension entitlements) and the employment relationship for time before the transfer, even if it becomes due after the transfer.

(iii)

The Service Provider shall be obliged to indemnify the Service Recipient against any entitlements for holiday and Christmas bonuses as well as any social security contributions, wage Tax and other ancillary costs pursuant to Clause 19.1.2 (Responsibility for Employees and External Staff) (pro rata

(iv)

To the extent the Service Recipient assumes obligations from transferring employees arising from the promise of a company pension scheme (“Pension Commitments”), the Service Provider shall either (i) transfer funds in cash equal to the accruals under German GAAP which are accrued for the Pension Commitments until the transfer of the relevant employment or (ii) make any statements and perform any actions required or useful to transfer any existing funds (e.g. reinsurance policies or other) to the Service Recipient and shall make an additional cash transfer insofar as the existing funds do not fully cover the pension accruals.

19.2.3

If a Service Employee of the Service Provider or an Extern alleges that the employment relationship of the Service Employee, or any liability in connection with the employment relationship or its termination, has transferred to the Service Recipient (“Claimant Employees”), the Service Recipient shall decide in its own discretion to contest the transfer of the employment relationship also in a court proceeding, in which case the Service Provider undertakes vis-à-vis the Service Recipient to indemnify the Service Recipient against 50% of the actual costs of the legal defense (including, in particular, any lawyer’s fees and court costs). Upon request the Service Provider shall promptly provide the Service Recipient with all necessary documents and information (in particular employment contracts and other personnel documents). The Service Provider undertakes vis-à-vis the Service Recipient to agree to an out-of-court or judicial settlement in which it is determined that the employment relationship of the Claimant Employees exists only with the Service Provider and not with the Service Recipient. Except in case of a settlement in accordance with the preceding sentence, the Service Provider will also indemnify the Service Recipient for the cost of any severance payment to the Claimant Employee for the period of employment with the Service Provider up to an amount of 0.5 months gross total salary (one month gross total salary = 1/12 of the last total gross annual salary received) per year of employment (calculated in years to two decimal places).

19.2.4

In addition, in case Service Employees or Externs successfully claim by way of a final and binding judgment that their employment relationship has transferred to the Service Recipient, the Service Provider and the Service Recipient will comply with their statutory obligations, for example with the provisions of section 613a of the German Civil Code (Bürgerliches Gesetzbuch), as far as applicable.

19.3

Transfer of Function Employees after the Service Term

19.3.1

As of the end of the relevant Service Term, the Parties envisage a transfer of employees in respect of certain Service Employees being identified as function employees as listed in Master Schedule 14 (Function Employees Transfer) (“Function Employees”) in accordance with Clause 2.6.1 of the Group Separation Agreement (“Transfer of Employees”). In respect of the Transfer of Employees, Clause 2.6 of the Group Separation Agreement shall apply mutatis mutandis. Should the Parties or their relevant Affiliates identify additional Service Employees to be Function Employees after the date hereof who are not listed in Master Schedule 14 (Function Employees Transfer) and shall be transferred at the end of the relevant Service Term, it is the Parties’ joint understanding that the Transfer of Employees of

19.3.2

Clause 19.2 shall not apply with regard to the Transfer of Employees according to Clause 19.3.1; however, if a Function Employee becomes a Claimant Employee during the relevant Service Term, Clause 19.2.2 shall apply.

20

Other Provisions

20.1

Sub-Contractors

20.1.1

Subject to Clause 20.1.2 (Sub-Contractors), the Service Provider shall not, without the Service Recipient’s prior written consent (such consent not to be unreasonably withheld or delayed), sub-contract any of its rights and obligations under the relevant Individual TSA.

20.1.2

The Service Provider shall not require the consent of the Service Recipient for:

(i)

any sub-contractors used by the Service Provider on the Conversion Effective Date;

(ii)

any new sub-contractors engaged as a result of a change to the way services similar to the Services are provided to other members of the Service Provider’s Group; or

(iii)

sub-contracting any obligations to members of its Group.

20.1.3

Subject always to Clause 10 (Liability), the Service Provider shall remain responsible for, and for the provision of, all Services, obligations and functions performed by any sub-contractor to the same extent as if such Services, obligations and functions were performed by the Service Provider.

20.2

Whole Agreement

20.3

Variation

20.3.1

No variation of this Master TSA shall be valid unless it is in writing and signed by or on behalf of each of the Parties. The same shall apply to any variation of this Clause 20.3.1 (Variation).

20.3.2

This Master TSA may be terminated, and any term may be amended or waived without the consent of any person that is not a Party.

20.3.3

The Individual Parties agree that variations of the Master TSA agreed between FSE and FME shall automatically result in corresponding variations of the Individual TSAs, unless such variations would result in noncompliance with applicable law.

20.4

Carry Forward of Rebates

20.5

Publicity and Public Announcements

20.6

Further Assurances

20.7

Assignment

20.8

Waiver

20.9

Notices

20.9.1

Any notice or other communication in connection with this Master TSA (each, a “Notice”) shall be in writing (email with scan of hand-signed document sufficient, text form pursuant to section 126b of the German Civil Code (Bürgerliches Gesetzbuch) otherwise not sufficient). Any reference to “in writing” or “written” or similar expression in this Master TSA shall be interpreted accordingly.

20.9.2

A Notice to FSE shall be sent to the following address, or such other person or address as FSE may notify to FME from time to time:

20.9.3

A Notice to FME shall be sent to the following address, or such other person or address as FME may notify to FSE from time to time:

20.10

Invalidity

20.11

Counterparts

20.12

Independent Contractor

20.13

Governing Law and Arbitration

20.13.1

This Master TSA and any contractual rights and obligations arising therefrom shall be exclusively governed by and construed in accordance with German law, excluding conflict of law rules and the United Nations Convention on Contracts for the International Sale of Goods (CISG). Any non-contractual rights and obligations in connection with this Master TSA shall also be governed by and construed in accordance with German law.

20.13.2

The Parties shall try to settle any disputes amicably in accordance with Clause 14.1 (Amicable Resolution). If it is not possible to reach such an amicable settlement, all disputes arising out of or in connection with this Master TSA, or its validity shall be finally settled in accordance with the Arbitration Rules of the German Arbitration Institute (DIS) without recourse to the ordinary courts of law. The arbitral tribunal shall be comprised of three members. The seat of the arbitration is Frankfurt am Main, Germany. The language of the arbitration shall be English. If mandatory law requires the issue to be decided upon by an ordinary court of law, the place of jurisdiction is Frankfurt am Main, Germany.

20.13.3

Unless the Parties agree otherwise, the Parties and their outside counsel who are involved in the arbitration shall not disclose to anyone any information concerning the arbitration, including in particular the existence of the arbitration, the names of the Parties, the nature of the claims, the names of any witnesses or experts, any procedural orders or awards, and any evidence that is not publicly available. Disclosures may nonetheless be made to the extent required by applicable law, by other legal duties, or for purposes of the recognition and enforcement or annulment of an arbitral award. No award or procedural order made in the arbitration shall be published.

1

Definitions

2

Interpretation

2.1

Singular, Plural, Gender

2.2

References to Persons and Companies

2.2.1

a person include any company, partnership or unincorporated association (whether or not having separate legal personality); and

2.2.2

a company shall include any company, corporation or any body corporate, wherever incorporated.

2.3

Schedules etc.

2.4

Information

2.5

Modification etc. of Statutes

2.5.1

that statute or provision as from time to time modified, re-enacted or consolidated whether before or after the date of this Master TSA; and

2.5.2

any subordinate legislation made from time to time under that statute or statutory provision which is in force at the date of this Master TSA.

2.6

Legal Terms

2.7

Non-limiting Effect of Words

2.8

Order of Precedence

2.8.1

Subject to Clause 2.8.3 (Order of Precedence) of this Master Schedule 1 (Definitions and Interpretation), if there is any conflict, apparent conflict or ambiguity in or between any of the sections of the Master TSA set out below, the sections will be applied in the following order of precedence with the sections higher in the order of precedence prevailing over the sections lower in the order of precedence:

(i)

the Clauses;

(ii)

the Schedules; and

(iii)

any other document referred to in this Master TSA

2.8.2

Subject to applicable law, where any provision of any Individual TSA conflicts with any provision of this Master TSA (including to the extent this Master TSA applies to and is incorporated into the Individual TSA), the provisions of the Individual TSA shall prevail.

2.8.3

In the event of a conflict between the provisions of the Clauses of the Master TSA, its Schedules, any other document referred to in this Master TSA, and/or any Individual TSA with the provisions of the Data Protection Framework Agreements, the provisions of the Data Protection Framework Agreements shall prevail.

(1)

[FME or FSE entity, as applicable, that provides services], a [●] incorporated under the laws of [●], registered with [●] under [●], (“Service Provider”); and

(2)

[FME or FSE entity, as applicable, that receives services], a [●] incorporated under the laws of [●], registered with [●] under [●], (“Service Recipient”)

(A)

FSE and FME plan to deconsolidate FME Group from FSE Group by changing FME’s legal form from a partnership limited by shares (Kommanditgesellschaft auf Aktien) to the legal form of a stock corporation (Aktiengesellschaft) under German law (the “Conversion”). As a result of the Conversion, FME Group will be separated from FSE Group pursuant to, among others, that certain group separation agreement made between FSE and FME in connection with the Conversion (the “Group Separation Agreement”).

(B)

FSE and certain companies of FSE Group have agreed to provide or procure the provision of certain transitional services to FME and certain companies of FME Group, and FME and certain companies of the FME Group have agreed to provide or procure the provision of certain transitional services to FSE and certain companies of FSE Group as of the Conversion Effective Date, in accordance with and subject to the terms of the Master TSA and in accordance with and subject to the terms of Individual TSAs to be concluded by the relevant companies of FME Group and FSE Group that provide respectively receive a transitional service.

(C)

Service Provider and Service Recipient have agreed to enter into this Individual TSA on the provision of transitional services by Service Provider to Service Recipient as further defined in Individual Schedule 1 (Services and Charges).

1

Incorporation of Terms and Conditions of Master TSA

2

Amendments to Incorporated Terms and Conditions of Master TSA

2.1

Terms and Conditions not incorporated by reference

2.1.1

The following clauses of the Master TSA shall not be incorporated pursuant to Clause 1 of this Individual TSA, but the respective heading shall be kept to preserve numbering with all content being replaced with the remark “[Intentionally left blank]”:

(i)

Clause 2 (Structure and Individual TSAs);

(ii)

Clause 6.1 (Transfer Report);

(iii)

Clause 7.7.1 sentence 3 (VAT);

(iv)

Clause 11 (Insurance);

(v)

Clause 12.3 (Parent company guarantee);

(vi)

Clause 19.3 (Transfer of Function Employees after the Service Term)

(vii)

Clause 20.9 (Notices); and

(viii)

Clause 20.13 (Governing Law and Arbitration).

2.1.2

The following schedules to the Master TSA shall not be incorporated by reference, but the respective heading shall be kept to preserve numbering with all content being replaced with the remark “[Intentionally left blank]”: