Business Practices Handbook for Cook Distributors

1Revised July 2011

Business Practices Handbook for Cook DistributorsDoing Business on Behalf of Cook Medical

Company Confidential - Do Not Distribute

2 Revised July 2011

Contents

Message from the President ............................................................................................3

Cook Mission Statement and Values ..............................................................................4

How Do You Do the Right Thing? ...................................................................................4

Working with Cook to:

I. Understand Ethical Business Practices ..........................................................5

II. Serve Patients ....................................................................................................6

III. Foster Best Business Practices ........................................................................7

IV. Interact Honestly with Governments and Regulators ................................10

V. Care for Cook Assets ......................................................................................11

Appendix A: Cook Global Anti-Bribery Policy & Guidance .......................................12

Introduction ............................................................................................................14

I. Elements of Bribery ............................................................................................14

Active Bribery ................................................................................................14

Passive Bribery ...............................................................................................14

Facilitation Payments .....................................................................................14

Failure to Prevent Bribery ..............................................................................15

II. Key Concepts .....................................................................................................15

III. Common Issues Arising When Interacting withHealthcare Professionals (HCPs) ..................................................................16

IV. Avoiding Problems ...........................................................................................17

Documentation ..............................................................................................17

Responding to Government Investigations ................................................17

3Revised July 2011

Message from the PresidentFor nearly half a century throughout the world, the name “Cook” has been associated with innovation, vision, quality, success and integrity. A commitment to honesty and ethical behavior allowed us to achieve this extraordinary reputation for excellence in our business dealings and relationships. This commitment is made by each of us as individuals and by our company as a whole. Cook is committed to ethical business behavior.

This handbook is designed to provide important guidance in good business practices worldwide as you represent Cook. We have taken special care to relate to you our requirements for appropriate business interaction with healthcare professionals. It is essential that you take time to read and understand this handbook. Every Cook employee, director, officer, consultant, distributor, partner and agent is responsible for conducting business honestly, ethically and in compliance with applicable laws worldwide and the principles outlined in this handbook. This handbook is designed to make it clear that compliance with anti-bribery laws around the globe is required in doing business as a distributor of Cook Medical products.

Each of us as individuals, committed to personal integrity, will build a promising future for us all.

Kem Hawkins, President Cook Group Incorporated

4 Revised July 2011

Cook Mission Statement

Cook is dedicated to bold leadership in pioneering innovative medical solutions to enhance patient care worldwide.

Values

Patients Maintain a deep concern for patient safety and well-being.

Quality Provide the highest quality medical products.

Customers Treat customers with respect and serve them to the best of our ability.

Knowledge Solve diverse medical problems while maintaining a willingness to listen, learn, innovate and educate.

Integrity Respect our company by giving our best effort, loyalty, honesty and accountability.

Employee Involvement Acknowledge the contribution of our fellow employees.

Corporate Citizenship Serve as a corporate role model for the betterment of society by being a sensitive employer and contributor to the communities where we reside, and an example of the highest integrity in business dealings.

Environment Minimize our corporate impact on the environment and act intentionally to preserve and improve our surroundings for future generations.

How Do You Do the Right Thing?

At Cook, “do the right thing” means:

• Patientsafetyalwayscomesfirst.

• Followthepoliciesandproceduresinthishandbook.

• Avoideventheappearanceofimpropriety.

• Don’tbuybusiness.

• Practicetransparencyinbusinesstransactions.

• CooperatewithCookreviewsandlegitimateexternalauditsandinvestigations.

• Bealeaderinearningtrustforthemedicaldeviceindustry.Recognizeandacton teaching moments

• Keepyourpromisestocustomers.

5Revised July 2011

I. Working with Cook to: Understand Ethical Business Practices

The written Cook programs must be considered first, unless a customer’s policy or local law or regulation is stricter.

1) Read, understand and take ownership of this Business Practices Handbook (“handbook”).

Trust is essential. All Cook employees and distributor partners should do what is right, treat peoplefairly,performwithdiligenceandhonesty,andotherwisesellCook’sproductsinamannerthatisabovereproach.Cook’sprinciplesofhonestyandintegrityareoutlinedinthishandbook. By reading, understanding and agreeing to follow the guidance provided in this handbook and the Cook policies underlying this guidance, we each take responsibility for sharing these values and for our resulting success in business.

This handbook provides general principles to guide all of us in making ethical and sound business decisions. This handbook is not meant to address every specific situation. Each of us must use common sense and good judgment, and ask for advice when necessary.

2) Understand the intent and spirit behind the anti-corruption and anti-bribery laws and the efforts of Cook, government regulators, medical institutions and societies, voluntary trade organizations and healthcare professional organizations to keep the medical device industry viableandrespected.Cook’sGlobalAnti-BriberyPolicy&Guidance(attachedinAppendixA) provides that any type of bribery, including facilitation or “grease payments,” will not be tolerated.

Integrity at Cook starts with each individual!

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II. Working with Cook to: Serve Patients

1) Provide quality products in a timely manner.

Ensuringapatient’shealthandwell-beingisthefirstandforemostobjective.ItisabigresponsibilityandonethatCooktakesveryseriously.ItisCook’spurposetodesign,manufacture and deliver products of the finest quality.

2) Follow applicable privacy laws.

Cook is committed to maintaining the confidentiality and integrity of protected personal information, such as medical health data, national identification numbers and payment details provided to us by our employees, customers, patients and clinical trial participants. Cook is committed to following relevant privacy legislation in every country where we do business. In addition, there are specific state and provincial laws governing personal information and breach notification around the world. If you have questions or need additional information, please contact the Cook Group Global Privacy Office at 812.331.1025.

3) Do your part to ensure data security.

In selling Cook products, part of the process may be the necessary collection of protected personal information for purposes such as fulfilling an order for a custom medical device, device tracking, or sales. Follow laws that apply to the collection, transmission, use, disclosure, retention and secure destruction of private data. In addition to the many national and local privacy laws worldwide, there are many strict laws that require immediate notification to government agencies in the event of a breach or loss of protected personal information.

Potential data security hazards while traveling highlight the need to evaluate what you store electronically and carry with you. Not all types of storage are appropriate for all types of confidential data.

Disease is our real competition.

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III. Working with Cook to: Foster Best Business Practices

1) Deal honestly and fairly in business.

Cook is fully committed to our tradition of developing strong customer relationships based on trust, knowledge, integrity and the highest quality medical devices in the world. It is a guiding principle at Cook to deal with our customers honestly and fairly. Furthermore, you must take the highest ethical road when interacting with competitors in the marketplace and follow the requirements of this handbook where applicable.

To maintain our ethical business practices worldwide, Cook will continue to seek the guidance of industry-related organizations and may adopt those guidelines.

2)Followacustomer’sinternalpoliciesandrequirements,andthoseofindividualpoliticaljurisdictions such as states, provinces, countries or medical societies with respect to doing business in their facilities, with their employees or with their members. The specific rules or policies of an individual medical institution or a hospital system regarding interaction between the medical device industry and healthcare professionals must be considered first, if its rules or policies are more stringent than Cook policies.

3) Certain types of interactions may pose risks under anti-corruption laws. In all cases there must be no corrupt intent and no expectation of favor. Carefully document the business activities to aid in proving honorable intent. Care is needed in the following types of interactions.

A. Meals. Meals must be modest and reasonable in value for the location, infrequent, directly related to a legitimate business purpose and held in a place conducive to conversation. Companypersonnelshouldbeinattendance(eitherCookorthedistributor’spersonnel).Follow the local, institutional or country laws as to permissibility and allowable limits.

B. Gifts. Cook’spolicyisnottogivegifts,notevenbusiness-relateditems.However,insomecountries or cultures, small gifts are expected in a business setting. Any such gifts should be modest and infrequent. Gifts may not be given for a corrupt purpose and must meet local, institutional and country rules.

C. Evaluation and Demonstration Devices. As the medical device industry distinguishes its work from that of pharmaceutical companies, and the different ways we need to work with healthcare professionals (HCPs), the terminology begins to change. “Samples” generally refers to drug samples. Now the new medical device industry terminology for products provided at no charge is “evaluation and demonstration” devices. Evaluation products are generally sterile products expected to be used for patient care. Demonstration products are not necessarily sterile but are intended for use in patient education consultations to describe a procedure. In either case, it is only appropriate to provide a reasonable number under the circumstances.

D. Entertainment/Recreation. Cook’spolicyistonotprovideentertainmentorrecreation.Again, if country or culture dictates and there is no violation of local, institutional and country rules, infrequent and modest entertainment or recreation may be appropriate. As with anything of value, entertainment or recreation may not be provided for a corrupt purpose.

8 Revised July 2011

E. Travel Expenses. Travel expenses must be business related. Expenses for spouses or guests are not allowed. Expenses for side trips are not allowed.

F. Cook Facility Tours or Customer Visits. Carefully observe the following:

i. Obtain prior written approval of the appropriate regional Cook company representative before arranging a tour/visit of the Cook facility.

ii. Provide prior notification of the trip to the government/organization/institution that employs the attendee, as required.

iii. Allow the government to select any attendee if the person is a government employee.

iv. Provide travel expenses in good faith, without corrupt intent or expectation of a favor.

v. Provide travel and accommodations that are reasonable and directly related to a legitimate business purpose.

vi. Maintain accurate records that reflect actual value and the purpose of the travel.

vii. Avoid side trips.

viii. Provideexpensesonlyforattendeeandnottheattendee’sspouse,relativesorguests.

ix. Avoid payment of a per diem to an attendee.

x. Provide tours or company visits infrequently.

G. Funding Requested by HCPs. Handle such requests carefully and assure transparency and appropriate conduct. Follow local and institutional laws and requirements, especially for government officials. To respond appropriately to requests from HCPs, consider the following:

i. Charitable donations should be given only to a registered charity.

ii. Education grants: Some hospitals and medical schools require prior notice.

iii. Research grants should only be allowed for well-designed projects with scientific merit.

iv. Sponsorship of third-party medical meetings

a. Sending HCPs to third-party medical meetings/conferences may require prior approval of the hospital or institution.

b. When providing scholarships for HCPs-in-training to attend bona fide educational meetings, allow the sponsoring educational program of the HCPs-in-training to select the attendees from among their students.

H. Fee-for-Service Arrangements—Professional Consulting Services Provided by an HCP. To avoid an accusation of bribery, it is necessary to have a written agreement, prior to the service, that provides for:

i. a legitimate need for an HCP consultant,

9Revised July 2011

ii. the appropriate qualifications for the selected HCP,

iii. specific details of the scope of work,

iv. fair market value compensation and

v. allows for only modest and necessary travel expense details.

It is necessary to keep documentation and proof that the professional services were received.

4) Follow the Cook accounting policies and procedures required by your agreement with Cook.

5)ItisCook’spolicytoprotectCook’sintellectualpropertyandtorespecttheintellectualproperty of others.

Treat customers honestly and fairly.

10 Revised July 2011

IV. Working with Cook to: Interact Honestly with Governments and Regulators

1) Assure regulatory compliance.

The provision of medical care and associated equipment, devices and pharmaceuticals are regulated and monitored by a variety of government agencies around the world. Cook expects all Cook distributor partners to understand and comply with laws, regulations and government directives that apply to their business activities. Cook is committed to cooperating in an open, helpful and effective manner with regulatory agencies on matters of regulatory policy, compliance, product submissions and product performance.

ItisCook’sexpectationthatallCookdistributorpartnersprovideaccurate,relevantinformation and records as requested to government regulatory bodies that are legally authorized to ask for such information.

2) Handle third-party inquiries (e.g., government and media) appropriately.

Cook will respond to legitimate third-party inquiries in a cooperative and responsible manner. Cook management must be informed immediately about any government, regulatory or media inquiry involving Cook products in order to properly and completely respond. If you are contacted by an outside individual or agency, please report immediately to management or directly to the Cook Group Legal Department at 812.339.2235.

3) Practice transparency.

Follow the guidance in this handbook.

4) Comply with applicable laws and regulations.

It is your responsibility as a Cook distributor partner to comply with laws and regulations that apply to our business activities worldwide. This includes observing US and EU trade or other applicable embargoes that restrict selling US or EU manufactured products in certain countries or to specially designated nationals. If you have any questions about how to comply with a law or regulation, please ask your Cook representative.

5) Cooperate with any internal or legitimate external investigation.

ItisCook’spolicythateachdistributorpartnerisresponsibleformaintainingaccuraterecordsand documentation and cooperating fully with any Cook or legitimate external auditors, investigators and governmental authorities.

6) Handle political interactions appropriately.

CookdistributorpartnersshouldnotattempttorepresentCook’spositionorstanceonissuesin the political arena. Do not provide political contributions on behalf of Cook.

7) Engage ethical business partners and associates.

Verify that business partners and associates are legitimate, reputable and qualified. Be mindful when interacting with government-owned healthcare facilities, as the HCPs may also be government employees, implicating the Foreign Corrupt Practices Act (US), UK Bribery Act and local anti-corruption and bribery laws and regulations.

11Revised July 2011

V. Working with Cook to: Care for Cook Assets

1) Maintain confidentiality.

Cook has taken many protective measures to maintain the integrity of our proprietary and confidential business information, such as how we conduct our business activities, the identities of our customers, and our manufacturing methods and processes. As a Cook distributor partner, your obligations are included in your Distributor Agreement with Cook.

2) Protect intellectual property.

ItisCook’spolicytoprotectourintellectualpropertyandtorespecttheintellectualpropertyofothers. Cook puts significant time, money and resources into developing our procedures and medical products. Our intellectual property includes, but is not limited to, processes, product designs, manufacturing methods, confidential information and our business practices. It is the responsibility of each of us to protect all company-confidential information. Limit exposure of ourconfidentialpropertyandrespectourcompetitors’effortstodothesame.

3) Avoid conflicts of interest.


Appendix A: Cook Global Anti-Bribery Policy & Guidance

Global Anti-bribery Policy & GuidanceJune 2011

CGI-BEI-GABP-EN-201111

13Revised July 2011

Scope

This Cook Global Anti-Bribery Policy & Guidance applies to Cook companies worldwide, as well as their officers,directors,employeesandanyonedoingbusinessonCook’sbehalf,includingagents, distributors or partners.

Purpose

This policy and guidance is part of the Cook Anti-Corruption Program and was written to assist all Cook employeesandthoseworkingonbehalfofCookinunderstandingCook’spositionwithrespecttobribery.In addition, we want to ensure compliance with the US Foreign Corrupt Practices Act (FCPA) and the UK Bribery Act.

Related Policies & Guidance

Internal: Cook Code of Conduct

Cook Policy & Guidance on Interaction with Healthcare Professionals

Cook Anti-Money Laundering Policy (also part of the Cook Group Accounting

Policy & Anti-Corruption Program)

External: Cook Medical Business Practices Handbook for Distributors:

Doing Business on Behalf of Cook Medical

Related Procedures: Internal: Distributor Program and Procedures

Effective Date: 1 July 2011

Resources

Transparency International Corruptions Perception Indexhttp://www.transparency.org/policy_research/surveys_indices/cpi/

Organisation for Economic Co-operation and Developmenthttp://www.oecd.org

UK Bribery Acthttp://www.legislation.gov.uk/ukpga/2010/23/contents http://www.justice.gov.uk/guidance/docs/bribery-act-2010-guidance.pdf

US Foreign Corrupt Practices Acthttp://www.justice.gov/criminal/fraud/fcpa/

Cook reserves the right to change this policy at any time.

Anti-Bribery Policy and Guidance


Contents

Introduction ..............................................................................................................................................................................4

I. Elements of Bribery ..............................................................................................................................................................4

Active Bribery .....................................................................................................................................................4

Passive Bribery ....................................................................................................................................................4

Facilitation Payments ..........................................................................................................................................4

Failure to Prevent Bribery ..................................................................................................................................4

II. Key Concepts ........................................................................................................................................................................5

III. Common Issues Arising When Interacting with Healthcare Professionals (HCPs) ......................................................5

IV. Avoiding Problems .............................................................................................................................................................6

Documentation ...................................................................................................................................................6

Responding to Government Investigations ....................................................................................................6



15

INTRODUCTION

There is a universal desire to stop corruption. Anti-bribery laws exist in virtually every country. Bribery negatively impacts everyone, causing needless expense and a loss of trust in business and government. Trust is especially important in the medical device industry. We depend on the trust of our customers, their patients, governments and regulators worldwide. The fact that we do not buy business has been a long-standing policy of Cook, and it is reflected in our written policies, such as our Code of Conduct and Policy & Guidance on Interaction with Healthcare Professionals, as well as in our corporate culture.

Bribery is an unlawful act and will not be tolerated in any form.

I. Elements of Bribery

Theconceptofbriberyisnowmorebroadlyconstructedthaneverbefore.Today’smoststringentlawsthat apply to Cook forbid certain actions that in the past were not considered to be illegal, such as “grease payments” made to expedite business activities.

The definition of bribery is not simply the act of giving money to a government official to induce an action. Bribery includes all actions associated with the bribe and all parties involved, including nongovernment officials. It is even considered an offense when a bribe is merely offered, promised or requested but not actually paid or received. Failure to prevent a bribe is now considered an offense.

There are four main categories of bribery that apply to both individuals and companies. The italicized key concepts are defined after the policy.

1. Active Bribery

Directly or indirectly by using a third party;

Offering, promising or actually giving anything of value corruptly, that is to say, knowingly or with “deliberate ignorance” or “willful blindness”;

to another person or to a government official, political party or political candidate;

to induce an improper purpose of securing or rewarding:

a. an improper advantage over another person or company, b. obtaining or retaining business or c. influencing an official act or decision of recipient.

2. Passive Bribery

Requesting or soliciting, agreeing to receive or accepting a bribe from another person.

3. Facilitation Payments

Facilitation payments made to expedite or secure the performance of a routine government action.

4. Failure to Prevent Bribery

Failure of a corporation to prevent an employee or a third party (such as a distributor), acting on behalf of the corporation, from making an actual bribe anywhere in the world.




II. Key Concepts

Anything of Value: In plain and simple terms, this phrase refers to anything that has any sort of value whatsoever. This is a very broad concept that includes cash or a cash equivalent, donations (including charitable donations), discounts, incentive payments, entertainment and recreation, medical meeting registration fees, a facilitation payment (defined below), travel expenses, meals, a job for a relative, a favor or in-kind services.

Bribe: Gaining financial or other advantage by giving anything of value to another individual or to a foreign government official for a corrupt reason such as inducing performance of a function or activity.

Healthcare Professionals (HCPs): This term refers to anyone working in a healthcare system who is in a position to purchase, lease or arrange for or recommend purchasing, leasing or ordering any goods, facility, service or item manufactured, marketed or sold by Cook. Examples include physicians, fellows, nurses, supply chain managers, materials managers, health fund officials and any professional society representing the interests of those HCPs.

Improper Purpose: In the context of bribery, this term refers to inducing performance by a person receivingabribe,whichamountstoabreachofareasonableperson’sexpectation(thisisaUKstandard;the reasonable person is not judged by normal behavior in the country concerned) that someone will act in good faith, impartially or in accordance with a position of trust relating to any function:

1. Of a public nature

2. Connected with a business

3. Performedinthecourseofaperson’semploymentor

4. Performed on behalf of a company or another body of persons

Facilitation Payment: Anything of value given to a government official, political party or party official the purpose of which is to expedite or to secure the performance of “a routine governmental action” (defined below). This type of payment is sometimes called a “grease payment.” Facilitation payments are illegal under the UK Bribery Act.

Government Official: Any person acting in an official capacity for or on behalf of any government or instrumentality thereof, or any public international organization. In some countries, HCPs may be government officials if they work in government-owned or -operated health facilities or funds.

Routine Governmental Action: An action that is routinely and commonly performed by a government official. These actions may include granting permits, licenses and inspections, or arranging police, mail, phone or water services. Specifically excluded from this type of action is any decision by a government official whether to award or continue business with a particular party (or on what terms to do so), or any action taken by a government official involved in the decision-making process to influence such a decision.

III. Common Issues Arising When Interacting with Healthcare Professionals

Certain types of interactions, such as those listed below, may pose risks under anti-bribery laws. In all cases, there must be no corrupt intent and no expectation of favor. Carefully document business activities such as these to aid in proving absence of corrupt intent:

A. Meals

B. Gifts

C. Evaluation and Demonstration Devices

D. Entertainment/Recreation



17Revised July 2011

E. Travel Expenses

F. Tours or Customer Visits

G. Funding Requested by HCPs:

a. Charitable donations

b. Education and research grants

c. Sponsorship of third-party medical meetings

i. Sending HCPs to third-party medical meetings/conferences

ii. Scholarships for HCPs-in-training

H. Fee-for-Service Arrangements:

a. Consulting—HCP professional services agreements

b. Exhibits at third-party medical meetings

I. Sales to Government or Government-Owned Hospitals or Clinics

Check the Cook Policy & Guidance on Interaction with Healthcare Professionals if you are a Cook employee, or if you are a distributor, check the Cook Medical Business Practices Handbook for Cook Distributors for details.

IV. Avoiding Problems

Documentation

Written, oral and electronic communications are critical to nearly every business function. However, too often correspondence and e-mails are written carelessly, without regard to the impression each writing, as an isolated document, may give to someone not familiar with the facts. Loose language can lead to costly investigations and litigation. Every document should be written with care and accuracy, using common sense and good judgment. The writing should be factual. Guessing and exaggeration should be avoided. Every document should be written with the assumption that it may be public someday.

Responding to Government Investigations

If any employee, officer, director or distributor is contacted by a government investigator or by a private attorney asserting a claim regarding a Cook product, immediately call the Cook Group Legal Department (812.339.2235) to make sure that the matter is reported to top management. Indicate to the inquiring governmentinvestigatororattorneythatitisCook’spolicytorespondtosuchmattersfromthecorporateoffice. Also note the name and phone number of the person making the inquiry and indicate that someone from the corporate office will respond to the inquiry.

ItisCook’spolicytocooperatefullyandhonestlywithgovernmentinvestigationsasrequiredbylaw.Also,if Cook or its employees are subject to an investigation, no employee should destroy any records that could be of any relevance to the investigation.




Certification

IacknowledgeandagreethatIhavereceivedacopyofCookMedical’sGlobalAnti-BriberyPolicy&Guidance (“Policy & Guidance”). I further acknowledge that I will familiarize myself with this Policy & Guidance and agree to abide by its terms.

Dated: the _____day of ___________________, 2011,

Signed: __________________________________________________

Printed Name: ____________________________________________

Title: ________________________________________

Signed on behalf by: _____________________________________________ (Organization Name)

19Revised July 2011

20 Revised July 2011© COOK 2012 CGI-BEI-BPHCD-EN-201201

Documents

Business Practices Handbook for Cook Distributors