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Form 8-K ORTHOFIX INTERNATIONAL For: Sep 07

September 9, 2016 4:15 PM EDT

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

______________________

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): September 7, 2016

______________________

 

Orthofix International N.V.

 

(Exact name of Registrant as specified in its charter)

 

 

Curaçao

 

0-19961

 

N/A

 

(State or other jurisdiction of incorporation)

 

(Commission File Number)

 

(IRS Employer Identification No.)

 

 

 

7 Abraham de Veerstraat

Curaçao

 

N/A

 

(Address of principal executive offices)

(Zip Code)

 

 

______________________

 

Registrant’s telephone number, including area code: 011-59-99-465-8525

______________________

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 


  

  

  


 

Item 5.02.  Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

Change in Control and Severance Agreement and Amended Employment Contract with Davide Bianchi

 

In June 2016, the Compensation Committee (the “Compensation Committee”) of the Board of Directors of Orthofix International N.V. (the “Company”) approved a new form of Change in Control and Severance Agreement for the Company’s US-based executive officers.   The Change in Control and Severance Agreement replaced the Company’s prior form of employment agreement for US-based executive officers, as the Compensation Committee has resolved to discontinue the practice of entering into employment agreements with US-based executives.  Among other things, such new agreement eliminates “single-trigger” change-in-control vesting for time-based equity grants made to executive officers on or after July 1, 2016, and replaces it with double-trigger vesting provisions during the 24-month period following a change in control.

 

On September 7, 2016, following approval by the Compensation Committee, the Company and Mr. Bianchi entered into (i) a Change in Control and Severance Agreement (the “Change in Control and Severance Agreement”) and (ii) an amended employment contract with Mr. Bianchi (the “Amended Employment Contract,” and collectively with the Change in Control and Severance Agreement, the “Revised Agreements”).

 

Under the Revised Agreements, Mr. Bianchi’s employment relationship with the Company remains governed by Swiss law.  The Committee approved the Revised Agreements with the intent of aligning the material terms of Mr. Bianchi’s employment relationship with the Company to that of US-based senior executives, while recognizing unique considerations and necessities of Swiss law, which include that certain employment-related terms be contractually memorialized in writing.  As a result, while the Change in Control and Severance Agreement generally conforms to the terms provided US-based executives, the Company has also entered into the Amended Employment Contract to address certain matters necessitated by Swiss law considerations.

 

Change in Control and Severance Agreement

 

The Change in Control and Severance Agreement is materially consistent with the agreement the Company has entered into with its US-based executives.  Under the Change in Control and Severance Agreement, Mr. Bianchi will be eligible to receive the following severance payments and benefits upon termination of the his employment (i) for death or disability, (ii) by the Company without “cause” (as defined in the agreement) or (iii) by Mr. Bianchi for “good reason” (as defined in the agreement):  

 

 

·

Any unpaid base salary, accrued vacation or prior years’ bonus payable or owing through the date of termination.

 

·

The pro rata amount of any incentive compensation for the year of termination of employment (based on the number of business days he is actually employed by the Company during the year in which termination of employment occurs) based on the achievement of the Company’s performance goals for such year.

 

·

An amount equivalent to 1.0 times the sum of: (i) Mr. Bianchi’s annual base salary plus (ii) his current year’s target bonus; provided that during the 24-month period following any change in control, the foregoing amount increases to 1.5 times such sum.  

 

·

If continuation coverage is available under the terms of applicable plans and Mr. Bianchi selects such continuation coverage in a timely manner, for the lesser of 12 months after termination or until he secures coverage from new employment, Mr. Bianchi shall receive a monthly cash payment equal to the cost of continuation coverage under the Company’s medical and dental benefit plans in which he was participating at the time of his termination of employment at the level at which he was participating at the time of his termination of coverage (e.g. single or family coverage), less the amount of the employee contribution for such coverage.  

 

·

$12,500 for use towards outplacement services.

  

  

  


 

 

The right to receive cash payments following a change in control remains subject to a “double trigger” provision, such that payments by the Company are only owed if the executive separates from employment in specific circumstances in connection with or following a change in control.

 

The agreement contains provisions that define certain vesting and exercise rights in connection with time-based stock options and time-based restricted stock granted (such as by defining the terms “cause,” “good reason” and “qualified retirement” for purposes of all prior and subsequent time-based equity grants).  The term of the agreement continues in effect until the earlier of (i) the parties’ satisfaction of their respective obligations (ii) the execution of a written agreement between the Company and Mr. Bianchi terminating the agreement, or (iii) the end of the month in which Mr. Bianchi reaches the legal retirement age (currently age 65) under the laws of Switzerland.  

 

Amended Employment Contract

 

The Amended Employment Contract memorializes Mr. Bianchi’s current cash compensation levels, and provides that such levels may be adjusted in the future as determined by the Compensation Committee.  The agreement contains non-competition and non-solicitation covenants effective so long as Mr. Bianchi is an employee and, in the case of the non-solicitation provisions, for a period of twelve months after employment is terminated. The agreement also contains confidentiality and assignment of inventions provisions that last indefinitely. The parties also remain party to a non-competition agreement governing post-termination periods.

 

The term of the Amended Employment Contract will continue until the earlier of (1) termination by either party in accordance with the terms of the agreement or (2) automatically (a) at the end of the month in which the Mr. Bianchi reaches the age of 65 or (b) at the end of the day on which Mr. Bianchi receives an early retirement pension or a full pension for disability. Mr. Bianchi’s primary business office shall be his home residence in Switzerland, provided, however, that he shall also from time-to-time perform services from the Company’s offices in Lewisville, Texas and Verona, Italy, and from such other locations as are agreed by the Company and him.

 

Text of Revised Agreements and Incorporation by Reference

 

The foregoing summaries are qualified in their entirety by reference to the texts of the Change in Control and Severance Agreement and the Amended Employment Contract, which are attached and filed herewith as Exhibits 10.1 and 10.2, respectively, and are incorporated herein by reference.

 

Item 9.01.   Financial Statements and Exhibits.

(d)

Exhibits

10.1

Change in Control and Severance Agreement, dated September 7, 2016, between Orthofix International N.V. and Davide Bianchi

10.2

Amended Employment Contract, dated September 7, 2016, between Orthofix International N.V. and Davide Bianchi

 

 

 

 


  

  

  


 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

Orthofix International N.V.

 

 

By:

 

 

/s/ Doug Rice

 

 

 

Doug Rice

Chief Financial Officer

 

 

 

Date: September 9, 2016


  

  

  


 

EXHIBIT INDEX

Exhibit No.

Description

10.1

Change in Control and Severance Agreement, dated September 7, 2016, between Orthofix International N.V. and Davide Bianchi

10.2

Amended Employment Contract, dated September 7, 2016, between Orthofix International N.V. and Davide Bianchi

 

 

  

  

  

 

Exhibit 10.1

ORTHOFIX INTERNATIONAL N.V.

CHANGE IN CONTROL AND SEVERANCE AGREEMENT

This AGREEMENT (the “Agreement”) is made and entered into as of September 7, 2016 (the “Effective Date”), by and between Orthofix International N.V., a company organized under the laws of Curaçao (together with its direct and indirect subsidiaries, the “Company”), and Davide Bianchi (the “Executive”).

RECITALS

WHEREAS, the Executive is expected to make significant contributions to the profitability, growth and financial strength of the Company;

WHEREAS, the Company believes that it is important to provide the Executive with severance benefits upon certain terminations of employment to provide the Executive with enhanced financial security and incentive and encouragement to remain with the Company;

WHEREAS, the Company recognizes that the possibility of a Change in Control (as hereinafter defined) and the uncertainty that it would cause could result in the departure or distraction of the Executive, to the detriment of the Company and its stockholders;

WHEREAS, the Company desires to encourage the continued employment of the Executive by the Company and wants assurance that it shall have the continued dedication, loyalty and service of, and the availability of objective advice and counsel from, the Executive notwithstanding the possibility, threat or occurrence of a Change in Control;

WHEREAS, concurrently with the parties entering into this Agreement, the parties are entering into an Amended Employment Contract, dated as of the date hereof (the “Employment Agreement”);

WHEREAS, the parties, together with the Company’s indirect subsidiary, Orthofix AG, have also entered into a Non-Competition Agreement, signed on November 26, 2013 (the “Non-Competition Agreement”);

WHEREAS, the Executive is currently party to an amended and restated employment agreement, entered into and effective as of November 20, 2014, between the Company and the Executive (the “Prior Employment Agreement”), which Prior Employment Agreement is being terminated as of the date hereof in connection with the parties entering into the Employment Agreement and this Agreement; and

WHEREAS, from and after the Effective Date, the Executive’s employment relationship with the Company shall be governed by the Employment Agreement, this Agreement and the Non-Competition Agreement.

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NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.Definitions.  As used in this Agreement, the following terms have the following meanings which are equally applicable to both the singular and plural forms of the terms defined:

(a)2012 LTIP” shall mean the Company’s 2012 Long-Term Incentive Plan, as amended from time-to-time (including after the Effective Date).

(b)Board” shall mean the Board of Directors of the Company.

(c)Cause” shall mean (i) willful and intentional commission by the Executive of one or more material acts of (A) fraud, misappropriation or embezzlement related to the business or property of the Company or (B) moral turpitude; (ii) conviction for, or guilty plea to, or plea of nolo contendere to, a felony; or (iii) fraud or willful misconduct committed by the Executive that caused or otherwise materially contributed to the requirement for an accounting restatement of the Company’s financial statements due to noncompliance with any financial reporting requirement (other than a restatement due to a change in accounting rules). No act or omission shall be deemed willful, intentional or material for purposes of this definition if taken or omitted to be taken by Executive in a good faith belief that such act or omission to act was in the best interests of the Company or if done at the express direction of the Board or the board of directors or principal executive officer of any acquirer of the Company.

(d)Change in Control” shall mean the occurrence of any of the following events:

(i)the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act), in any individual transaction or series of related transactions, of 50% or more of either (A) the then outstanding shares of common stock of Parent (the “Outstanding Common Stock”) or (B) the combined voting power of the then outstanding voting securities of Parent entitled to vote generally in the election of directors (the “Outstanding Voting Securities”); excluding, however, the following:  (1) any acquisition directly from Parent, other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from Parent; (2) any acquisition by Parent; (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by Parent or any entity controlled by Parent; or (4) any acquisition pursuant to a transaction which complies with clauses (A), (B) and (C) of subsection (iii) of this definition of Change in Control;

(ii)a change in the composition of the Board such that the individuals who as of the Effective Date constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, for purposes of this paragraph, that any individual who becomes a member of the Board subsequent to the Effective Date, whose appointment, election, or nomination for election by Parent’s shareholders was approved by a vote of at least a majority of those individuals who are members of the Board and who were also

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members of the Incumbent Board (or deemed to be such pursuant to this proviso) shall be considered as though such individual were a member of the Incumbent Board; but provided further that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board; 

(iii)consummation of a reorganization, merger, consolidation or other business combination or the sale or other disposition of all or substantially all of the assets of Parent (including assets that are shares held by Parent in its subsidiaries) (any such transaction, a “Business Combination”); expressly excluding, however, any such Business Combination pursuant to which all of the following conditions are met:  (A) all or substantially all of the Person(s) who are the beneficial owners of the Outstanding Common Stock and Outstanding Voting Securities, respectively, immediately prior to such Business Combination will beneficially own, directly or indirectly, more than 50% of, respectively, the outstanding shares of common stock, and the combined voting power of the outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity which as a result of such transaction owns Parent or all or substantially all of Parent’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the Outstanding Common Stock and Outstanding Voting Securities, as the case may be, (B) no Person (other than Parent, any employee benefit plan (or related trust) of Parent or such entity resulting from such Business Combination) will beneficially own, directly or indirectly, 50% or more of, respectively, the outstanding shares of common stock of the entity resulting from such Business Combination or the combined voting power of the outstanding voting securities of such entity entitled to vote generally in the election of directors except to the extent that such ownership existed prior to the Business Combination, and (C) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the entity resulting from such Business Combination;

(iv)the approval by the shareholders of Parent of a complete liquidation or dissolution of Parent;

(v)the Company shall sell or dispose of, in a single transaction or series of related transactions, business operations that generated two-thirds of the consolidated revenues of the Company (determined on the basis of Company’s four most recently completed fiscal quarters for which reports have been filed under the Exchange Act) and such disposal shall not be exempted pursuant to clause (iii) of this definition of Change in Control;

(vi)Parent files a report or proxy statement with the Securities and Exchange Commission pursuant to the Exchange Act disclosing in response to Form 8-K or Schedule 14A (or any successor schedule, form or report or item therein) that a change in control of Parent has or may have occurred or will or may occur in the future pursuant to any then-existing agreement or transaction; notwithstanding the foregoing, unless determined in a specific case by a majority vote of the Board, a “Change in Control” shall not be deemed to have occurred solely because:  (A) an entity in which Parent directly or indirectly beneficially owns

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50% or more of the voting securities, or any Parent-sponsored employee stock ownership plan, or any other employee plan of the Company, either files or becomes obligated to file a report or a proxy statement under or in response to Schedule 13D, Schedule 14D-1, Form 8-K or Schedule 14A (or any successor schedule, form or report or item therein) under the Exchange Act, disclosing beneficial ownership by form or report or item therein, disclosing beneficial ownership by it of shares of stock of Parent, or because Parent reports that a change in control of Parent has or may have occurred or will or may occur in the future by reason of such beneficial ownership or (B) any Company‑sponsored employee stock ownership plan, or any other employee plan of the Company, either files or becomes obligated to file a report or a proxy statement under or in response to Schedule 13D, Schedule 14D-1, Form 8-K or Schedule 14A (or any successor schedule, form or report or item therein) under the Exchange Act, disclosing beneficial ownership by form or report or item therein, disclosing beneficial ownership by it of shares of stock of Parent, or because Parent reports that a change in control of Parent has or may have occurred or will or may occur in the future by reason of such beneficial ownership; or 

(vii)any other transaction or series of related transactions occur that have substantially the effect of the transactions specified in any of the preceding clauses in this definition.

Notwithstanding this definition of “Change in Control,” the Board, in its sole discretion, may determine that a Change in Control has occurred for purposes of this Agreement, even if the events giving rise to such Change in Control are not expressly described in the above definition.

(e)CiC Date” shall mean the date on which a Change in Control occurs.

(f)CiC Period” shall mean the 24-month period commencing on the CiC Date; provided, however, if the Company terminates the Executive’s employment with the Company prior to the CiC Date but on or after a Potential CiC Date, and it is reasonably demonstrated that the Executive’s (i) employment was terminated at the request of an unaffiliated third party who has taken steps reasonably calculated to effect a Change in Control or (ii) termination of employment otherwise arose in connection with or in anticipation of the Change in Control, then the “CiC Period” shall mean the 24 month period beginning on the date immediately prior to the date of the Executive’s termination of employment with the Company.

(g)CiC Period Good Reason” shall mean the occurrence of any of the following without the written consent of the Executive: (1) a requirement that the Executive work principally from a location that is more than thirty (30) miles from his or her current principal place of employment, (2) any reduction in the Executive’s Total Compensation, (3) any material breach of this Agreement or any other material agreement with the Executive by the Company or any successor entity, or (4) any diminution in the Executive’s employment position, authority, duties, responsibilities or line of reporting structure, or the assignment to the Executive of any duties materially inconsistent with the Executive’s position and title immediately prior to consummation of the Change in Control (including, for example, if Executive was the Chief Financial Officer of the Company immediately prior to consummation of a Change in Control and is not the Chief Financial Officer of the Company immediately following consummation of the Change in Control, then a diminution in the Executive’s responsibilities will have occurred), in each case excluding for this purpose an isolated, insubstantial and inadvertent action taken in

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good faith and which is promptly remedied by employer.  The Executive shall only have CiC Period Good Reason if (x) the Executive has provided notice of termination to the Company of any of the foregoing conditions within ninety (90) days of the initial existence of the condition, (y) the Company does not cure such condition within thirty (30) days following receipt of such notice of termination, and (z) if such condition is not cured within such thirty (30) day period, the Executive actually terminates employment within sixty (60) days after the notice of termination.  The Executive’s mental or physical incapacity following the occurrence of an event described above in clauses (1), (2), (3) or (4) shall not affect the Executive’s ability to terminate employment for CiC Period Good Reason and the Executive’s death following delivery of a notice of termination for CiC Period Good Reason shall not affect the Executive’s estate’s entitlement to the severance benefits provided hereunder upon a termination of employment for CiC Period Good Reason. 

(h)Compensation Committee” shall mean the Compensation Committee of the Board.

(i)Disability” as used in this Agreement shall have the meaning given that term by any disability insurance the Company carries at the time of termination that would apply to the Executive. Otherwise, the term “Disability” shall mean the inability of the Executive to perform each of the essential duties of the Executive’s position by reason of a medically determinable physical or mental impairment which is potentially permanent in character or which can be expected to last for a continuous period of not less than 12 months. Any dispute as to whether or not the Executive has a “Disability” for purposes of this Agreement shall be resolved by a physician reasonably satisfactory to the Board and the Executive (or his legal representative, if applicable). If the Board and the Executive (or his legal representative, if applicable) are unable to agree on a physician, then each shall select one physician and those two physicians shall pick a third physician and the determination of such third physician shall be binding on the parties.  

(j)Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

(k)Good Reason” shall mean: (i) during a CiC Period, CiC Period Good Reason; and (ii) during a Non-CiC Period, Non-CiC Period Good Reason.

(l)Non-CiC Period” shall mean any period of time that is not a CiC Period.

(m)Non-CiC Period Good Reason” shall mean the occurrence of any of the following without the written consent of the Executive: (1) a requirement that the Executive work principally from a location that is more than fifty (50) miles from his or her current principal place of employment, (2) any 10% or greater reduction in the sum of the Executive’s base salary and target bonus opportunity, (3) any 20% or greater reduction in the grant date fair value of equity-based compensation annually awarded to the Executive (other than reductions that are made substantially pro rata to other executives of the Company), or (4) any material breach of this Agreement or any other material agreement with the Executive by the Company or any successor entity. The Executive shall only have Non-CiC Period Good Reason if (x) the Executive has provided notice of termination to the Company of any of the foregoing conditions

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within ninety (90) days of the initial existence of the condition, (y) the Company does not cure such condition within thirty (30) days following receipt of such notice of termination, and (z) if such condition is not cured within such thirty (30) day period, the Executive actually terminates employment within sixty (60) days after the notice of termination.  The Executive’s mental or physical incapacity following the occurrence of an event described above in clauses (1), (2), (3) or (4) shall not affect the Executive’s ability to terminate employment for Non-CiC Period Good Reason and the Executive’s death following delivery of a notice of termination for Non-CiC Period Good Reason shall not affect the Executive’s estate’s entitlement to the severance benefits provided hereunder upon a termination of employment for Non-CiC Period Good Reason. 

(n)Parent” shall mean Orthofix International N.V.

(o)Person” shall include individuals or entities such as corporations, partnerships, companies, firms, business organizations or enterprises, and governmental or quasi-governmental bodies.

(p)Qualified Retirement” shall mean a retirement from Service by the Executive in which, at the time of such retirement, the sum of the Executive’s age and aggregate 12-month completed periods of Service (whether or not such completed 12-month periods are consecutive), in each case without giving credit for any partial years, equals or exceeds 75.

(q)Service” shall have the meaning ascribed to such term in the 2012 LTIP.

(r)Total Compensation” shall mean aggregate of base salary, target bonus opportunity, employee benefits (retirement plan, welfare plans, and fringe benefits), and grant date fair value of equity-based compensation, but excluding for the avoidance of doubt any reductions caused by the failure to achieve performance targets) taken as a whole.

2.Term of Agreement.  The term of this Agreement (the “Term”) shall commence on the Effective Date and shall continue in effect until the earlier of (i) the parties’ satisfaction of their respective obligations under this Agreement, (ii) the execution of a written agreement between the Company and the Executive terminating this Agreement, or (iii) the end of the month in which the Executive reaches the legal retirement age (currently age 65) under the laws of Switzerland.

3.Certain Terminations of Employment During a Non-CiC Period.  If, during a Non-CiC Period, the Executive’s employment with the Company terminates as a result of death, the Executive terminates his or her employment as a result of Disability or for Non-CiC Period Good Reason, or the Company terminates the Executive’s employment without Cause, the Company shall pay or provide to the Executive (i) the Executive’s annual base salary due through the Executive’s date of termination, (ii) any amounts or benefits owing to the Executive as of the Executive’s date of termination under the then applicable benefit plans of the Company, at the time such amounts or benefits are due (including any accrued vacation payable), (iii) any amounts owing to the Executive for reimbursement of expenses properly incurred by the Executive prior to the Executive’s date of termination, which shall be subject to and paid in accordance with the Company’s expense reimbursement policy, (iv) if, for the calendar year

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prior to the Executive’s termination, Executive has achieved performance goals such that Executive has earned a bonus under any annual cash incentive program of the Company (an “Annual Cash Incentive Program”) and such Annual Cash Incentive Program bonus with respect to such prior calendar year has not yet been determined and/or paid, the amount of such bonus, payable at the same time as payments are made to other participants under such Annual Cash Incentive Program, and (v) a pro rata amount of any Annual Cash Incentive Program bonus, if any, with respect to the year of termination (based on the number of days the Executive was employed by the Company during such year of termination) based on the achievement of applicable performance goals for such year, payable during the following year at the same time as payments are made to other participants under such Annual Cash Incentive Program (collectively, the “Accrued Amounts”).  Subject to the Executive’s compliance with the restrictive covenants in Section 8 hereof and the Executive’s execution and non-revocation of the release described in Section 5 hereof, the Company shall also pay to the Executive, in a cash lump sum within ten (10) days following the Release Effective Date (as defined below), an amount equal to one (1) times the sum of (A) the Executive’s annual base salary in effect as of the Executive’s date of termination (without giving effect to any reduction of base salary that has occurred within the 12-month period preceding such date of termination), (B) the Executive’s current annual target cash bonus amount under the Annual Cash Incentive Program (without giving effect to any reduction of such annual target amount that has occurred within the 12-month period preceding such date of termination and (C) $12,500 to be used by the Executive for outplacement services (such sum, the “Severance Amount”).  Notwithstanding the foregoing, if the Severance Amount could be paid to the Executive during the subsequent taxable year of the Executive rather than the Executive’s taxable year in which the Executive’s date of termination occurs based on when the Executive executes and delivers the release described in Section 5 hereof to the Company, then, to the extent that the Severance Amount constitutes nonqualified deferred compensation subject to Section 409A of Internal Revenue Code of 1986, as amended (the “Code”), the Severance Amount shall not be paid earlier than the first business day of the later of such taxable years.  In addition, subject to the Executive’s compliance with the restrictive covenants in Section 8 hereof and the Executive’s execution and non-revocation of the release described in Section 5 hereof, if continuation coverage is available under the terms of the applicable plan(s) and Executive selects such continuation coverage in a timely manner, for the lesser of 12 months after termination or until the Executive secures coverage from new employment, Executive shall receive a monthly cash payment equal to the cost of continuation coverage under the Company’s medical and dental benefit plans in which the Executive was participating at the time of his termination of employment at the level at which the Executive was participating at the time of his termination of coverage (e.g. single or family coverage), less the amount of the employee contribution for such coverage.  Such payments shall be subject to all applicable taxes and withholding.  The Executive must advise the Company as soon as the Executive becomes eligible for health care coverage from a third party (e.g., spouse’s employer, the Executive’s subsequent employer, or any other party with a relationship with the Executive). 

4.Termination of Employment During a CiC Period.  If, during a CiC Period, the Executive’s employment with the Company terminates as a result of death, the Executive terminates his or her employment as a result of Disability or for CiC Period Good Reason, or the Company terminates the Executive’s employment without Cause, the Company shall: (A) pay or provide to the Executive the Accrued Amounts, and (B) subject to the Executive’s compliance

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with the restrictive covenants in Section 8 hereof and the Executive’s execution and non-revocation of the release described in Section 5 hereof, (i) pay to the Executive, in a cash lump sum within ten (10) days following the Release Effective Date, an amount equal to one and one-half (1.5) times the sum of (A) the Executive’s annual base salary in effect as of the Executive’s date of termination (without giving effect to any reduction of base salary that has occurred within the 12-month period preceding such date of termination), (B) the Executive’s current annual target cash bonus amount under the Annual Cash Incentive Program (without giving effect to any reduction of such annual target amount that has occurred within the 12-month period preceding such date of termination and (C) $12,500 to be used by the Executive for outplacement services (such sum, the “CiC Severance Amount”); provided, however, that if the CiC Severance Amount could be paid to the Executive during the subsequent taxable year of the Executive rather than the Executive’s taxable year in which the Executive’s date of termination occurs based on when the Executive executes and delivers the release described in Section 5 hereof to the Company, then, to the extent that the CiC Severance Amount constitutes nonqualified deferred compensation subject to Section 409A of the Code, the CiC Severance Amount shall not be paid earlier than the first business day of the later of such taxable years; and (ii) if continuation coverage is available under the terms of the applicable plan(s) and Executive selects such continuation coverage in a timely manner, for the lesser of 12 months after termination or until the Executive secures coverage from new employment, provide Executive a monthly cash payment equal to the cost of continuation coverage under the Company’s medical and dental benefit plans in which the Executive was participating at the time of his termination of employment at the level at which the Executive was participating at the time of his termination of coverage (e.g. single or family coverage), less the amount of the employee contribution for such coverage.  Such payments shall be subject to all applicable taxes and withholding.  The Executive must advise the Company as soon as the Executive becomes eligible for health care coverage from a third party (e.g., spouse’s employer, the Executive’s subsequent employer, or any other party with a relationship with the Executive).    

5.Payments Contingent Upon Release Agreement.  As a condition to receiving the Severance Amount or the CiC Severance Amount, as applicable, and the reimbursement of medical and dental continuation coverage premiums pursuant to Sections 3 or 4 hereof, the Executive will execute a release of claims substantially in the form of the release attached hereto as Exhibit A (the “Release”).  Within ten (10) business days of the Executive’s date of termination, the Company shall deliver to the Executive the Release for the Executive to execute.  The Executive will forfeit all rights to receive the Severance Amount or the CiC Severance Amount, as applicable, and the reimbursement of medical and dental continuation coverage premiums pursuant to Sections 3 or 4 hereof unless, within forty-five (45) days of delivery of the Release by the Company to the Executive, the Executive executes and delivers the Release to the Company and such Release has become irrevocable by virtue of the expiration of the revocation period specified therein without the Release having been revoked (the first such date, the “Release Effective Date”).  The Company’s obligation to pay the Severance Amount or the CiC Severance Amount, as applicable, or to reimburse medical and dental continuation coverage premiums pursuant to Sections 3 or 4 hereof, is subject to the occurrence of the Release Effective Date, and if the Release Effective Date does not occur, then the Company shall have no obligation to make such payments or reimbursements.  Any reimbursements of medical and dental continuation coverage premiums pursuant to Sections 3 or 4 hereof that would otherwise

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have become due prior to the Release Effective Date shall be paid in a cash lump sum within ten (10) days following the Release Effective Date; provided, that if any reimbursements of medical and dental continuation coverage premiums pursuant to Sections 3 or 4 hereof could be paid to the Executive during a different taxable year of the Executive than the Executive’s taxable year in which the Executive’s date of termination occurs based on when the Executive executes and delivers the Release to the Company, then, to the extent that the reimbursements constitute nonqualified deferred compensation subject to Section 409A of the Code, the reimbursement amounts shall not be paid earlier than the first business day of the later of such taxable years.  In the event the Executive breaches one or more of the restrictive covenants set forth in Section 8 hereof, the Executive shall forfeit the Executive’s right to receive the Severance Amount or the CiC Severance Amount, as applicable, and the reimbursement of medical and dental continuation coverage premiums pursuant to Sections 3 or 4 hereof, and, to the extent such amounts have been paid to the Executive, shall repay to the Company the after-tax amount of any such previously paid amounts.   

6.Time-Based Stock Options and Time-Based Restricted Stock Vesting and Exercisability.  The provisions set forth in Sections 6(a), (b), (c) and (e) below shall apply with respect to (a) all time-based vesting stock options of the Company (“Time-Based Stock Options” or “Options”) granted to the Executive before or after the date of this Agreement, and (b) all time-based vesting shares of restricted stock of the Company (“Time-Based Restricted Stock” or “TBRS”) granted to the Executive before or after the date of this Agreement.  The provisions set forth in Section 6(d) below only shall apply with respect to all Time-Based Stock Options and Time-Based Restricted Stock granted during or after the 2016 calendar year.  Such provisions shall supersede and override any conflicting provisions set forth in applicable award agreements of the Company governing applicable grants, and shall be incorporated by reference into the terms of such award agreements.

(a)Termination with or without Cause; Certain Voluntary Terminations. If, prior to vesting, the Executive’s Service is terminated for any reason other than (i) death, (ii) Disability, (iii) a Qualified Retirement occurring no less than six months after the grant date of the Option (the “Grant Date”) or (iv) a circumstance providing for accelerated vesting pursuant Section 6.1(d) hereof, the unvested portion of the applicable Option or TBRS shall be cancelled and revert back to the Company as of the date of such termination of Service, and the Executive shall have no further right or interest therein unless the Compensation Committee in its sole discretion shall determine otherwise.  In such event, the Executive shall have the right, subject to the other terms and conditions set forth in this Agreement and the Plan, to exercise such Option, to the extent it has vested as of the date of such termination of Service, at any time within 3 months after the date of such termination of Service, subject to the earlier expiration of the Option on the 10-year anniversary of grant or such other term as is provided in the applicable equity award agreement otherwise governing such grant (the “Expiration Date”).  To the extent the vested portion of the Option is not exercised within such 3-month period, such Option shall be cancelled and revert back to the Company and the Executive shall have no further right or interest therein.

(b)Termination of Service for Death or Disability. If the Executive’s Service terminates by reason of death or Disability, as of the date of such termination of Service (i) the

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unvested portion of any Option shall automatically vest and become immediately exercisable in full and (ii) any TBRS shall automatically vest in full.  The full portion of any unexercised Option shall remain exercisable by the Executive (or any person entitled to do so) at any time within 18 months after the date of such termination of Service, subject to the earlier expiration of such Option on the Expiration Date. To the extent such Option is not exercised within such  period, such Option shall be cancelled and revert back to the Company and the Executive or any permitted transferee pursuant to the terms of the applicable award agreement, as applicable, shall have no further right or interest therein. 

(c)Termination of Service for Certain Qualified Retirements. If the Executive’s Service terminates by reason of a Qualified Retirement occurring no less than six months after the Grant Date but prior to the second anniversary of the Grant Date, any Option shall automatically vest and become immediately exercisable, and any TBRS shall be considered vested, as of the date of such termination of Service with respect to the aggregate number of shares of common stock of Parent as to which such Option or TBRS, as applicable, would have been vested as of such second anniversary of the Grant Date.  If the Executive’s Service terminates by reason of a Qualified Retirement after the second anniversary of the Grant Date but before the third anniversary of the Grant Date, any Option shall automatically vest and become immediately exercisable, and any TBRS shall be considered vested, as of the date of such termination of Service with respect to the aggregate number of shares of common stock of Parent as to which such Option or TBRS, as applicable, would have been vested as of such third anniversary of the Grant Date.  If the Executive’s Service is terminated by reason of a Qualified Retirement after the third anniversary of the Grant Date but before the fourth anniversary of the Grant Date, any Option shall automatically vest and become immediately exercisable, and any TBRS shall be considered vested, in full as of the date of such termination of Service.  In each of the circumstances described in the preceding three sentences, the applicable Option shall remain exercisable by the Executive (or any person entitled to do so) at any time within 18 months after the date of such termination of Service, subject to the earlier expiration of the Option on the Expiration Date.  To the extent such Option is not exercised within such 18-month period, the Option shall be cancelled and revert back to the Company and the Executive or any permitted transferee pursuant to the terms of the applicable award agreement, as applicable, shall have no further right or interest therein.

(d)Certain Additional Change in Control Circumstances. In the event that any Option granted during or after the 2016 calendar year is assumed or continued, or substituted for new common stock options or another equity-based award of a successor entity, or parent or subsidiary thereof (with appropriate adjustments as to the number of shares and option exercise prices), or any unvested portion of the TBRS granted during or after the 2016 calendar year is assumed or continued, or substituted for new restricted common stock or another equity-based award of a successor entity, or parent or subsidiary thereof (with appropriate adjustments as to the number of shares), in each case upon the consummation of any Change in Control, and the employment of the Executive with the Company is terminated by the Company without Cause or by the Executive for CiC Period Good Reason, in each case during a CiC Period, (i) such Option shall be fully vested and may be exercised in full, to the extent applicable, beginning on the date of such termination and for the 24-month period immediately following such termination (subject to the earlier expiration of the Option on the Expiration Date) or for such longer period

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as the Compensation Committee shall determine and (ii) the unvested portion of such TBRS shall be fully vested. (Nothing in the preceding sentence shall limit or alter the Executive’s rights under Section 6.1(c) hereof in the event that the Executive instead terminates his or her Service by reason of a Qualified Termination.) In the event that a Change in Control occurs in which outstanding Options and/or shares of TBRS are not being assumed, continued or substituted (as contemplated by the preceding sentence), any Option granted during or after the 2016 calendar year and the unvested portion of any TBRS granted during or after the 2016 calendar year shall be treated in accordance with the default rules applicable under Section 17.3 of the 2012 LTIP (or if made pursuant to a successor long-term incentive plan, the default rules contained in such plan).  For the avoidance of doubt, nothing in this clause (d) shall amend or supersede any Change in Control-related or other provisions in applicable award agreements of the Company governing grants of Options or TBRS made during any calendar year ended on or before December 31, 2015.  

(e)Definition of Qualified Retirement.  The term Qualified Retirement as used in any award agreement with respect to Options or TBRS shall, notwithstanding any definition of such phrase in an award agreement, be defined as set forth in this Agreement.

(f)Survival.  All of the provisions in this Section 6 shall survive any expiration or termination of this Agreement for any reason (unless such termination is as a result of a future novation of such provisions entered into by each of the parties).  

7.Section 280G.  In the event that any of the severance payments and other benefits provided by this Agreement or otherwise payable to Executive (a) constitute “parachute payments” within the meaning of Section 280G of the Code, and (b) but for this Section 7, would be subject to the excise tax imposed by Section 4999 of the Code (“Excise Tax”), then Executive’s severance payments and benefits under this Agreement or otherwise shall be payable either in full or in such lesser amount which would result in no portion of such severance payments or benefits being subject to the Excise Tax, whichever of the foregoing amounts, taking into account the applicable federal, state and local income and employment taxes and the Excise Tax, results in the receipt by Executive, on an after-tax basis, of the greatest amount of severance payments and benefits under this Agreement or otherwise, notwithstanding that all or some portion of such severance payments or benefits may be taxable under Section 4999 of the Code.  Any reduction in the severance payments and benefits required by this Section 7 shall be made in the following order: (i) reduction of cash payments; (ii) reduction of accelerated vesting of equity awards other than stock options; (iii) reduction of accelerated vesting of stock options; and (iv) reduction of other benefits paid or provided to Executive.  The calculations and establishment of assumptions in this Section 7 will be performed by a professional tax firm engaged by the Company as of the day prior to the CiC Date.  If the tax firm so engaged by the Company is serving as accountant or auditor for the acquiring company, the Company shall appoint a nationally recognized tax firm to make the determinations required by this Section 7.  The Company shall bear all expenses with respect to the determinations by such firm required to be made by this Section 7.  The Company and Executive shall furnish such tax firm such information and documents as the tax firm may reasonably request in order to make its required determination.  The tax firm will provide its calculations, together with detailed supporting documentation, to the Company and Executive as soon as practicable following its engagement.  

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Any good faith determinations of the tax firm made hereunder shall be final, binding and conclusive upon the Company and Executive.  However, the Executive shall have the final authority to make any good faith determination(s) associated with the assumptions used by the tax firm in providing its calculations, and such good faith determination by the Executive shall be binding on the Company.  As a result of the uncertainty in the application of Sections 409A, 280G or 4999 of the Code at the time of the initial determination by the professional tax firm described in this Section 7, it is possible that the Internal Revenue Service (the “IRS”) or other agency will claim that an Excise Tax greater than that amount, if any, determined by such professional firm for the purposes of this Section 7 is due (the “Additional Excise Tax”).  Executive shall notify the Company in writing of any claim by the IRS or other agency that, if successful, would require payment of Additional Excise Tax.  Executive and the Company shall each reasonably cooperate with the other in connection with any administrative or judicial proceedings concerning the existence or amount of liability for Excise Tax with respect to payments made or due to Executive.  The Company shall pay all reasonable fees, expenses and penalties of Executive relating to a claim by the IRS or other agency.  In the event it is finally determined that a further reduction would have been required under this Section 7 to place Executive in a better after-tax position, Executive shall repay the Company such amount within 30 days thereof in order to effect such result. 

8.Section 409A.

(a)For purposes of Section 409A of the Code (“Section 409A”) (i) each “payment” (as defined by Section 409A) made under this Agreement shall be considered a “separate payment,” and (ii) payments shall be deemed exempt from the definition of deferred compensation under Section 409A to the fullest extent possible under (x) the “short-term deferral” exemption of Treasury Regulation § 1.409A-1(b)(4), and (y) with respect to amounts paid as separation pay (as defined under Treasury Regulation § 1.409A-1(m)) no later than the second calendar year following the calendar year containing the Executive’s “separation from service” (as defined for purposes of Section 409A), the “two years/two-times” separation pay exemption of Treasury Regulation § 1.409A-1(b)(9)(iii), which exemptions are hereby incorporated by reference.  

(b)Any payments otherwise payable under this Agreement shall not commence until the Executive has a “separation from service” (as defined in Section 409A).  

(c)If the Executive is a “specified employee” as defined in Section 409A (and as applied according to procedures of the Company and its affiliates) as of the Executive’s separation from service, to the extent any payment under this Agreement constitutes deferred compensation (after taking into account any applicable exemptions from Section 409A) that is payable upon a separation from service, and to the extent required in order to avoid the imposition of an excise tax under Section 409A, no payments due under this Agreement may be made until the earlier of:  (1) the date of the Executive’s death and (2) the first day of the seventh month following the Executive’s separation from service, provided, however, that any payments delayed during this six-month period shall be paid in the aggregate in a lump sum on the first day of the seventh month following the Executive’s separation from service (or upon the date of the Executive’s death, if earlier).

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(d)Any expense reimbursements or in kind benefits under this Agreement that constitute deferred compensation within the meaning of Section 409A shall be made or provided in accordance with the requirements of Section 409A, including, without limitation, that: (i) the expenses eligible for reimbursement or the amount of in-kind benefits provided in one taxable year shall not affect the expenses eligible for reimbursement or the amount of in-kind benefits provided in any other taxable year; (ii) the reimbursement of an eligible expense shall be made no later than the end of the year after the year in which such expense was incurred; and (iii) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit. 

(e)If this Agreement fails to meet the requirements of Section 409A, neither the Company nor any of its affiliates shall have any liability for any tax, penalty or interest imposed on the Executive by Section 409A, and the Executive shall have no recourse against the Company or any of its affiliates for payment of any such tax, penalty, or interest imposed by Section 409A.

9.Restrictive Covenants.  

(a)Non-Disparagement.  The Executive agrees that the Company’s reputation and goodwill in the marketplace is of utmost importance and value to the Company.  The Executive further agrees that during and after the term of the Executive’s employment with the Company, the Executive will not make, publish or cause to be published any public or private statement or comments disparaging or defaming the Company, its subsidiaries or affiliates, or any of their respective stockholders, partners, members, directors, managers, officers and employees.  The Executive acknowledges and agrees that this prohibition extends to statements, written or verbal, made to anyone, including but not limited to, the news media, competitors, vendors, and employees (past and present).  The Executive further understands and agrees that this Section 9(a) is a material provision of this Agreement and that any breach of this Section 9(a) shall be a material breach of this Agreement, and that the Company would be irreparably harmed by violation of this provision.

(b)Cooperation.  The Executive agrees that after the Executive’s date of termination, the Executive shall make the Executive available at reasonable times, intervals and places for interviews, consultations, internal investigations and/or testimony during which the Executive shall provide to the Company, or its designated attorneys or agents, any and all information known to the Executive regarding or relating to the Company or the Executive’s activities on behalf of the Company pertaining to the subject matter on which the Executive’s cooperation is sought.  The Executive agrees to remain involved for so long as any such matters shall be pending.  

(c)Survival of Covenants.  The provisions and restrictive covenants in this Section 9 shall survive the expiration or termination of this Agreement for any reason.  The Executive agrees not to challenge the enforceability or scope of the provisions and restrictive covenants in this Section 9.  The Executive further agrees to notify all future persons or businesses, with which the Executive becomes affiliated or employed by, of the provisions and restrictions set forth in this Section 9, prior to the commencement of any such affiliation or employment.  If any of the provisions in this Section 9 are construed to invalid or unenforceable

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in any respect, the parties agree that the same may be modified as the court may direct to make such provisions and covenants reasonable, and such modification shall not affect the remainder of such provision, and such provisions shall be given the maximum possible effect and the modified agreement shall be fully enforceable. 

(d)Injunctive Relief. The Executive acknowledges that if the Executive breaches or threatens to breach any of the provisions of this Agreement, the Executive’s actions will cause irreparable harm and damage to the Company which cannot be compensated by damages alone. Accordingly, if the Executive breaches or threatens to breach any of the provisions of this Agreement, the Company shall be entitled to injunctive relief, in addition to any other rights or remedies the Company may have. The Executive hereby waives the requirement for a bond by the Company as a condition to seeking injunctive relief.  The existence of any claim or cause of action by the Executive against the Company, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of the Executive’s agreements under this Agreement.

10.Entire Agreement.  The parties agree that this Agreement, the Employment Agreement and the Non-Competition Agreement represents the entire agreement of the parties with respect to the subject matter hereof, including with respect to severance payments and benefits.

11.Miscellaneous.  

(a)Any and all disputes arising from the employment relationship between the Company and the Executive, shall be settled exclusively by arbitration to be governed by ICC Rules (International Chamber of Commerce) and resolved by three (3) arbitrators appointed as follows: The Company shall jointly appoint one (1) arbitrator, the executive shall appoint one (1) arbitrator and the third arbitrator shall be appointed by the already appointed arbitrators.  The place of arbitration shall be Zug, Switzerland, and shall be conducted in the English language.

(b)This Agreement is subject to Swiss law.  Except as otherwise provided in Section 11(a), all actions or proceedings arising out of this Agreement shall exclusively be heard and determined in courts in Zug, Switzerland having appropriate jurisdiction.  The parties expressly consent to the exclusive jurisdiction of such courts in any such action or proceeding and waive any objection to venue laid therein or any claim for forum nonconveniens.

(c)This Agreement may be executed in any number of counterparts, each of which, when executed by both parties to this Agreement shall be deemed to be an original, and all of which counterparts together shall constitute one and the same instrument.  

(d)The failure of either party hereto to enforce any right under this Agreement shall not be construed to be a waiver of that right, or of damages caused thereby, or of any other rights under this Agreement.  

(e)This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives.

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(f)This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.  This Agreement shall bind any successor of or to the Company, its assets or its businesses (whether direct or indirect, by purchase, merger, consolidation or otherwise), in the same manner and to the same extent that the Company would be obligated under this Agreement if no succession had taken place.  In the case of any transaction in which a successor would not by the foregoing provision or by operation of law be bound by this Agreement, the Company shall require such successor expressly and unconditionally to assume and agree to perform the Company’s obligations under this Agreement, in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.  All rights under this Agreement are personal to the Executive and, without the prior written consent of the Company, shall not be assignable by the Executive otherwise than by shall or the laws of descent and distribution.  This Agreement shall inure to the benefit of and be enforceable in the event of the Executive’s death or disability by the Executive’s legal representatives, heirs and legatees. 

(g)Any provision in this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating or affecting the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

(h)Notices and all other communications contemplated by this Agreement shall be in writing and shall be deemed to have been duly given when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid or when sent by express U.S. mail or overnight delivery through a national delivery service (or an international delivery service in the case of an address outside the U.S.) with signature required.  Notice to the Company shall be directed to the attention of the General Counsel of the Company at the address of the Company’s headquarters, and notice to the Executive shall be directed to the Executive at the Executive’s most recent personal residence on file with the Company.

(i)The Company shall deduct from the amounts payable to the Executive pursuant to this Agreement all required withholding amounts and deductions, including but not limited to federal, state and local withholding amounts in accordance all applicable laws and regulations and deductions authorized by the Executive.  The Executive shall be solely responsible for and shall pay all taxes associated with the amounts payable under this Agreement.  

[Signature page follows]

 

 

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IN WITNESS WHEREOF, each of the undersigned has executed this Agreement as of the date first above written.

 

ORTHOFIX INTERNATIONAL N.V.

 

By:  /s/ Bradley R. Mason

        Name: Bradley R. Mason

        Title: President and Chief Executive Officer

 

EXECUTIVE

 

/s/ Davide Bianchi

Davide Bianchi

 

 

Accepted and agreed for purposes of Section 10:

ORTHOFIX INC.

 

By:  /s/ Bradley R. Mason

        Name: Bradley R. Mason

        Title: President and Chief Executive Officer

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EXHIBIT A

Release

 

You, for yourself, your spouse and your agents, successors, heirs, executors, administrators and assigns, hereby irrevocably and unconditionally forever release and discharge Orthofix International N.V., a company organized under the laws of Curaçao (together with its direct and indirect subsidiaries, the “Company”), its parents, divisions and affiliates and its and their current and former owners, directors, officers, stockholders, insurers, benefit plans, representatives, agents and employees, and each of their predecessors, successors, and assigns (collectively, the “Releasees”), from any and all actual or potential claims or liabilities of any kind or nature, including, but not limited to, any claims arising out of or related to your employment and separation from employment with the Company and any services that you provided to the Company; any claims for salary, commissions, bonuses, other severance pay, vacation pay, allowances or other compensation, or for any benefits under the Employee Retirement Income Security Act of 1974 (“ERISA”) (except for vested ERISA benefits); any claims for discrimination, harassment or retaliation of any kind or based upon any legally protected classification or activity; any claims under Title VII of the Civil Rights Acts of 1964, the Civil Rights Act of 1866 and 1964, as amended, 42 U.S.C. § 1981, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Americans with Disabilities Act, 42 U.S.C. §1981, 42 U.S.C. § 1983, the Family Medical Leave Act and any similar state law, the Fair Credit Reporting Act and any similar state law, the Fair Credit Reporting Act, 15 U.S.C. § 1681, et seq., the Worker Adjustment and Retraining Notification Act, 29 U.S.C. § 2101, et seq., the Equal Pay Act and any similar state law, including the California Worker Adjustment and Retraining Notification Act, Cal. Labor Code § 1400, et seq., the California Fair Employment and Housing Act, Cal. Gov’t Code § 12940, et seq., California Government Code Section 12900 et seq. (which prohibits discrimination based on protected characteristics including race, color, religion, sex, gender, sexual orientation, marital status, national origin, language restrictions, ancestry, physical or mental disability, medical condition, age, and denial of leave), California Civil Code Section 51 et seq. (which prohibits discrimination based on age, sex, race, color, religion, ancestry, national origin, disability, medical condition, marital status, or sexual orientation), the California Family Rights Act of 1993, the California Equal Pay Law, Cal. Lab. Code § 1197.5, et seq. or any California wage payment law, any other section of the California Labor Code, any section of the applicable Order of the California Industrial Welfare Commission, as well as any amendments to any such laws; any claims for any violation of any federal or state constitutions or executive orders; any claims for wrongful or constructive discharge, violation of public policy, breach of contract or promise (oral, written, express or implied), personal injury not covered by workers’ compensation benefits, misrepresentation, negligence, fraud, estoppel, defamation, infliction of emotional distress, contribution and any claims under any other federal, state or local law, including those not specifically listed in this Release, that you, your heirs, executors, administrators, successors, and assigns now have, ever had or may hereafter have, whether known or unknown, suspected or unsuspected, up to and including the date of your execution of this Release.

 

For the purpose of implementing a full and complete release and discharge of the Releasees as set forth above, you acknowledge that this Release is intended to include in its effect, without limitation, all claims known or unknown that you have or may have against the

  


 

Releasees which arise out of or relate to your employment, including but not limited to compensation, performance or termination of employment with the Company, except for, and notwithstanding anything in this Release to the contrary, claims which cannot be released solely by private agreement.  This Release also excludes any claims relating to any right you may have to payments pursuant to Sections 3 or 4 of the Change in Control and Severance Agreement, entered into as of September 7, 2016, or under the Amended Employment Contract, entered into as of September 7, 2016, in each case by and between the Company and me, any claim for workers’ compensation benefits and any rights you may have to indemnification or directors’ and officers’ liability insurance under the Company’s articles of association, certificates of incorporation or bylaws, any indemnification agreement to which you are a party or beneficiary or applicable law, as a result of having served as an officer, director or employee of the Company or any of its affiliates.  You further acknowledge and agree that you have received all leave, compensation and reinstatement benefits to which you were entitled through the date of your execution of this Release, and that you were not subjected to any improper treatment, conduct or actions as a result of a request for leave, compensation or reinstatement. 

 

You further acknowledge that you have read Section 1542 of the Civil Code of the State of California, which provides as follows:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.

You understand that Section 1542 gives you the right not to release existing claims of which you are not now aware, unless you voluntarily choose to waive this right.  Even though you are aware of this right, you nevertheless hereby voluntarily waive the right described in Section 1542 and any other statutes of similar effect, and elect to assume all risks for claims that now exist in your favor, known or unknown, arising from the subject matter of the Release.  You acknowledge that different or additional facts may be discovered in addition to what you now know or believe to be true with respect to the matters released in this Release, and you agree that this Release will be and remain in effect in all respects as a complete and final release of the matters released, notwithstanding any such different or additional facts.  

 

You affirm, by signing this Release, that you have not suffered any unreported injury or illness arising from your employment, and that you have not filed, with any federal, state, or local court or agency, any actions or charges against the Releasees relating to or arising out of your employment with or separation from the Company.  You further agree that while this Release does not preclude you from filing a charge with the National Labor Relations Board (“NLRB”), the Equal Employment Opportunity Commission (“EEOC”) or a similar state or local agency, or from participating in any investigation or proceeding with them, you do waive your right to personally recover monies or reinstatement as a result of any complaint or charge filed against the  Company with the NLRB, EEOC or any federal, state or local court or agency, except as to any action to enforce or challenge this Release, to recover any vested benefits under ERISA, or to recover workers’ compensation benefits.

  

    

  


 

 

You acknowledge:

 

 

(a)

That you were provided forty-five (45) full days during which to consider whether to sign this Release.  If you have signed this Agreement prior to the expiration of the 45-day period, you have voluntarily elected to forego the remainder of that period.

 

 

(b)

That you have carefully read and fully understand all of the terms of this Release.

 

 

(c)

That you understand that by signing this Release, you are waiving your rights under the Age Discrimination in Employment Act, as amended by the Older Workers Benefit Protection Act, 29 U.S.C. § 621, et seq., and that you are not waiving any rights arising after the date that this Release is signed.

 

 

(d)

That you have been given an opportunity to consult with anyone you choose, including an attorney, about this Release.

 

 

(e)

That you understand fully the terms and effect of this Release and know of no claim that has not been released by this Release.  And, you further acknowledge that you are not aware of, or that you have fully disclosed to the Company, any matters for which you are responsible or which has come to your attention as an employee of the Company that might give rise to, evidence, or support any claim of illegal conduct, regulatory violation, unlawful discrimination, or other cause of action against the Company.

 

 

(f)

That you have made full and truthful disclosures to the Company’s compliance department regarding any misconduct (including any violations of federal securities laws) relating to the Company or its subsidiaries of which you are aware, and that you understand that notwithstanding anything herein or in any other agreement to the contrary, in no event shall you be prohibited or limited from my right to provide truthful information to or otherwise assist U.S. governmental authorities in any investigation regarding the Company (whether pursuant to Section 21F of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise), and in the event of such assistance, nothing herein or in any other agreement shall be deemed to conflict with my right to receive any award payable pursuant to Section 21F of the Exchange Act.

 

 

(g)

That these terms are final and binding on you.

 

 

(h)

That you have signed this Release voluntarily, and not in reliance on any representations or statements made to you by any employee or officer of the Company or any of its subsidiaries.

 

 

(i)

That you have seven (7) days following your execution of this Release to revoke it in writing, and that this Release is not effective or enforceable until after this

  

    

  


 

 

seven (7) day period has expired without revocation.  If you wish to revoke this Release after signing it, you must provide written notice of your decision to revoke this Release to the Company, to the attention of the General Counsel of the Company at the address of the Company’s headquarters, by no later than 11:59 p.m. on the seventh calendar day after the date on which you have signed this Release.  

 

 

PLEASE READ CAREFULLY.  THIS RELEASE INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.

 

ACKNOWLEDGED AND AGREED

 

 

 

 

 

Davide Bianchi

 

Date

 

  

    

  

 

Exhibit 10.2

AMENDED EMPLOYMENT CONTRACT

 

This Amended Employment Contract (this “Agreement”), entered into and effective as of September 7, 2016 (the “Effective Date”), is by and between Orthofix International N.V., a company organized under the laws of Curacao (the “Company”), Davide Bianchi, an individual (the “Executive”), born on January 14, 1965, and, solely for purposes of Sections 6.1(b) and 7.4 hereof, Orthofix AG, a company organized under the laws of Switzerland and a wholly owned subsidiary of the Company (“AG”).

 

PRELIMINARY STATEMENTS

 

A.Executive currently serves as the Company’s President, Extremity Fixation pursuant to an Amended and Restated Employment Agreement, entered into and effective as of November 20, 2014, between Executive and the Company (the “Existing Employment Agreement”), which Existing Employment Agreement is being amended and superseded by this Agreement.

 

B.In connection with Executive’s current employment, AG and the Executive have entered into a Non-Competition Agreement, signed on November 26, 2013 (the “Non-Competition Agreement”), which Non-Competition Agreement is attached hereto as Exhibit B, and will remain in full force and effect after the Effective Date.

 

C.Simultaneous with the execution and delivery of this Agreement, the Executive and the Company are also entering into a Change in Control and Severance Agreement, dated as of September 7, 2016 (the “Severance Agreement”), which Severance Agreement will also be in full force and effect after the Effective Date.

 

D.Capitalized terms used herein and not otherwise defined have the meaning for them set forth on Exhibit A attached hereto and incorporated herein by reference.

 

The parties, intending to be legally bound, hereby agree as follows:

 

I.EMPLOYMENT AND DUTIES

 

1.1Duties.  The Company currently employs the Executive as its President, Extremity Fixation, and the Company and the Executive agree that Executive’s employment by the Company shall prospectively be governed by the terms and conditions set forth herein.  The Executive shall continue to have such power and authority and perform such duties, functions and responsibilities as are associated with and incident to his positions, and as the Board may from time to time require of him.  The Executive continues to agree to serve, if elected, as an officer or director of any other direct or indirect subsidiary of the Company, in each such case at no compensation in addition to that provided for in this Agreement, but the Executive serves in such positions

  

 


 

solely as an accommodation to the Company and such positions shall grant him no rights hereunder (including for purposes of the definition of Good Reason). 

 

1.2Services.  During the Term (as defined in Section 1.3), and excluding any periods of vacation, sick leave or disability, the Executive agrees to dedicate his regular work hours fully to the Company, spare time work shall not conflict with the business interest of the Company.

 

1.3Term of Employment.  The term of this Agreement shall commence on the Effective Date and shall continue until the earlier of (1) termination by either party in accordance with the terms of this Agreement or (2) automatically (a) at the end of the month in which the Executive reaches the legal retirement age (currently age 65) or (b) at the end of the day on which the Executive receives an early retirement pension or a full pension for disability (the “Term”).

 

1.4Place of Performance.  During the Term, the Executive’s primary business office shall be his home residence in Switzerland, provided, however, that Executive shall also from time-to-time perform services from the Company’s offices in Lewisville, Texas and Verona, Italy, and from such other locations as are agreed by the Company and the Executive.

 

1.5Working Hours.  Regular working hours are 40 hours per week (Monday through Friday).  Nevertheless, the demands of the Executive’s position may require him to work irregular hours and the Executive undertakes to work such irregular hours, at the request of the Company.  To that end, the Executive agrees, in accordance with business requirements as well as legal limits, to work overtime as well as to work on Sundays and bank holidays.  Upon request of the overtime, the Company has to consider the business needs as well as the rights of the Executive.  Overtime is covered inside the remuneration package.

 

II.COMPENSATION

 

2.1General. The base salary and Incentive Compensation (as defined in Section 2.3.) payable to the Executive hereunder, as well as any stock-based compensation, including stock options, stock appreciation rights and restricted stock grants, shall be determined from time to time by the Board or the Compensation Committee and paid pursuant to the Company’s customary payroll practices or in accordance with the terms of the applicable Plans (as defined in Section 2.4).  The Company shall pay the Executive in cash (in Swiss Francs), in accordance with the normal payroll practices of the Company, the base salary and Incentive Compensation set forth below.  For the avoidance of doubt, in providing any compensation payable in stock, the Company may withhold, deduct or collect from the compensation otherwise payable or issuable to the Executive a portion of such compensation to the extent required to comply with applicable tax laws to the extent such withholding is not made or otherwise provided for pursuant to the agreement governing such stock-based compensation.

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2.2Base Salary.  The Executive’s base salary will be set no less than annually by the Board or the Compensation Committee.  As of the Effective Date, the Executive’s base salary is CHF 353,632, payable in 12 monthly installments of CHF 29,469 per month.

 

2.3Bonus or other Incentive Compensation.  With respect to each fiscal year of the Company during the Term, the Executive shall be eligible to receive annual bonus compensation under the Company’s Executive Annual Incentive Plan or any successor plan (the “Bonus Plan”), as determined by the Board or the Compensation Committee, based on the achievement of goals established by the Board or the Compensation Committee from time to time (the “Goals”).  For 2016, the Executive’s target bonus opportunity under the Bonus Plan shall be 60% of his current Base Salary with an opportunity to earn a maximum bonus of 90% of his current Base Salary.   The amount of any actual payment for 2016 and any subsequent year will depend upon the achievement (or not) of the Goals established by the Board.  Except as otherwise provided in this Agreement or the Severance Agreement, to receive a bonus under the Bonus Plan, the Executive must be employed on the date of payment of such bonus.   Amounts payable under the Bonus Plan shall be determined by the Board and shall be paid following such fiscal year and no later than two and one-half months after the end of such fiscal year.  In addition, the Executive shall be eligible to receive such additional bonus or incentive compensation as the Board or the Compensation Committee may establish from time to time in its sole discretion.  Any bonus or incentive compensation under this Section 2.3 under the Bonus Plan or otherwise is referred to herein as “Incentive Compensation.”  Stock-based compensation shall not be considered Incentive Compensation under the terms of this Agreement unless the parties expressly agree otherwise in writing.

 

2.4Stock Compensation.  The Executive shall be eligible to receive stock-based compensation, whether stock options, stock appreciation rights, restricted stock grants or otherwise, under the Company’s 2012 Long Term Incentive Plan or other stock-based compensation plans as the Company may establish from time to time (collectively, the “Plans”).  The Executive shall be considered for such grants no less often than annually as part of the Board’s and/or the Compensation Committee’s annual compensation review, but any such grants shall be at the sole discretion of the Board and/or Compensation Committee.  

 

2.5Car Allowance.  The Executive shall receive an annual car allowance to the extent provided for under any applicable Company policy and approved by the Board and/or Compensation Committee.

 

III.EMPLOYEE BENEFITS

 

3.1General.  So long as the Executive is employed by the Company pursuant to this Agreement, he shall be eligible for the following benefits to the extent generally available to senior executives of the Company or by virtue of his position, tenure, salary and other qualifications.  Any eligibility shall be subject to and in accordance with the

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terms and conditions of the Company’s benefits policies and applicable plans (including as to deductibles, premium sharing, co-payments or other cost-splitting arrangements). 

 

3.2Savings and Retirement Plans.  The Executive shall be entitled to participate in, and enjoy the benefits of, all savings, pension, salary continuation and retirement plans, practices, policies and programs generally available to senior executives of the Company.  The premium contribution to the corporate pension scheme of the Company is compliant with the requirement of the Swiss Occupational Pension Legislation BVG (Berufsvorsorgegesetz).  The annual premium depends on the amount of the salary and the age of the Employee.  At the present time, it is approximately CHF 56,400.  Two thirds of the premium is paid by the Company and one third by the Employee. The Employee’s contribution is deducted from his salary in monthly installments of approximately CHF 1,600.  In addition, the Employee will receive further a voluntary contribution to the 3rd column in the amount of CHF 6,768 per annum.

 

3.3Welfare and Other Benefits.  

 

(a)The Executive and/or the Executive’s eligible dependents, as the case may be, shall be entitled to participate in, and enjoy the benefits of, all welfare benefit plans, practices, policies and programs provided by the Company at a level that is generally available to other senior executives of the Company.

 

(b)In the event that Executive is unable to perform his duties under this Agreement due to illness, the Executive shall receive his salary according to the terms and conditions of the insurance for loss of earnings due to illness, which is covered by the Company.  If insurance for loss of earnings due to illness has not been entered into, the continuation of pay shall be determined by Art. 324a of the Swiss Code of Obligations.

 

(c)The Company shall take out accident insurance for the employee according to Swiss law and to the terms usually offered by the Company.

 

3.4Vacation.  The Executive shall be entitled to 5 weeks paid vacation (25 working days) per calendar year, in addition to bank and other public holidays.  If the Executive’s employment begins or terminates during a calendar year, his entitlement to holidays shall be pro-rata temporis.  The Company shall be entitled to require the Executive to take holiday at its request and may also refuse to allow him to take holiday in circumstances where it would be inconvenient to the business.  The Company reserves the right to refuse holiday up to and including the day before the holiday is due to be taken.  In the event the Company exercises such right to refuse holiday, the Company will reimburse the Executive for all prepaid, nonrefundable costs or penalties associated with the cancellation.

 

3.5Expenses.  The Executive shall be entitled to receive prompt reimbursement for all reasonable business-related expenses incurred by the Executive in performing his duties under this Agreement.  Reimbursement of the Executive for such

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expenses will be made upon presentation to the Company of expense vouchers that are in sufficient detail to identify the nature of the expense, the amount of the expense, the date the expense was incurred and to whom payment was made to incur the expense, all in accordance with the expense reimbursement practices, policies and procedures of the Company.   

 

3.6Key Man Insurance.  The Company shall be entitled to obtain a “key man” or similar life or disability insurance policy on the Executive, and neither the Executive nor any of his family members, heirs or beneficiaries shall be entitled to the proceeds thereof.  Such insurance shall be available to offset any payments due to the Executive in accordance with Section 5.1 of this Agreement due to his death or Disability.

 

IV.TERMINATION OF EMPLOYMENT

 

4.1Termination by Mutual Agreement.  The Executive’s employment may be terminated at any time during the Term by mutual written agreement of the Company and the Executive.

 

4.2Death.  The Executive’s employment hereunder shall terminate upon his death.

 

4.3Disability.  In the event the Executive incurs a Disability, the Executive may terminate his employment during the Term by delivering a Notice of Termination (as defined in Section 4.7) to the Company 30 days in advance of the date of termination.  

 

4.4Good Reason; Cause. The Executive may terminate his employment at any time during the Term for Good Reason, the Company may terminate the Executive’s employment at any time during the Term for Cause, in each case by delivering a Notice of Termination to the other party 30 days in advance of the date of termination.  

 

4.5Termination without Cause by the Company. The Company may terminate the Executive’s employment at any time during the Term without Cause by delivering to the Executive a Notice of Termination 6 months in advance of the date of termination; provided that as part of such notice the Company may request that the Executive immediately tender the resignations contemplated by Section 4.8 and otherwise cease performing his duties hereunder.  The date of termination shall be the date set forth in the Notice of Termination.  

 

4.6Termination without Good Reason by the Executive.  The Executive may voluntarily terminate his employment at any time during the Term by delivering to the Company a Notice of Termination 6 months in advance of the date of termination (a “Voluntary Termination”).  For purposes of this Agreement, a Voluntary Termination shall not include a termination of the Executive’s employment by reason of death or Disability or for Good Reason, but shall include voluntary termination upon retirement in accordance with the Company’s retirement policies and/or applicable law. A Voluntary Termination shall not be considered a breach or other violation of this Agreement.

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4.7Notice of Termination.  Any termination of employment under this Agreement by the Company or the Executive requiring a notice of termination shall require delivery of a written notice by one party to the other party (a “Notice of Termination”). A Notice of Termination must indicate the specific termination provision of this Agreement relied upon and the date of termination. The date of termination specified in the Notice of Termination shall comply with the time periods required under this Article IV, and may in no event be earlier than the date such Notice of Termination is delivered to or received by the party getting the notice.  No Notice of Termination under Section 4.4 shall be effective until the applicable cure period, if any, shall have expired without the Company or the Executive, respectively, having corrected the event or events subject to cure to the reasonable satisfaction of the other party.  The terms “termination” and “termination of employment,” as used herein are intended to mean a termination of employment which constitutes a “separation from service” under Section 409A.

 

4.8Resignations.  Upon ceasing to be an employee of the Company for any reason, or earlier upon request by the Company pursuant to Section 4.5, the Executive agrees to immediately tender written resignations to the Company with respect to all officer and director positions he may hold at that time with any member of the Company Group.

 

V.PAYMENTS ON TERMINATION

 

5.1Death; Disability; Resignation for Good Reason; Termination without Cause.  If at any time during the Term the Executive’s employment with the Company is terminated due to his death, resignation for Disability or Good Reason or termination by the Company without Cause, the Executive shall be entitled to the payment and benefits set forth in Sections 3 or 4 of the Severance Agreement, as and to the extent applicable, and subject to all terms, conditions and requirements set forth in the Severance Agreement.

 

5.2Termination for Cause; Voluntary Termination.  If at any time during the Term the Executive’s employment with the Company is terminated by the Company for Cause or due to a Voluntary Termination, the Executive shall be entitled to only the following:

 

(a)any unpaid base salary and accrued unpaid vacation then owing through the date of termination, which amounts shall be paid to the Executive within 30 days of the date of termination.  

 

(b)whatever rights, if any, that are available to the Executive upon such a termination pursuant to the Plans or any award documents related to any stock-based compensation such as stock options, stock appreciation rights or restricted stock grants. This Agreement does not grant any greater rights with respect to such items than provided for in the Plans or the award documents in the event of any termination for Cause or a Voluntary Termination.  

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5.3Social Security.  The Executive and the Company shall each pay half of the contributions which are owed as a matter of law for AHV (Old Age and Survivors’ Insurance), IV (Invalidity Insurance), EO (Loss of Earnings) and ALV (Unemployment Insurance).  The Executive’s contributions shall be deducted by the Company from his gross salary.

 

VI.PROTECTIVE PROVISIONS

 

6.1Noncompetition.  

 

(a) Without the prior written consent of the Board (which may be withheld in the Board’s sole discretion), so long as the Executive is an employee of the Company or any other member of the Company Group, the Executive agrees that he shall not anywhere in the Prohibited Area, for his own account or the benefit of any other, engage or participate in or assist or otherwise be connected with a Competing Business.  For the avoidance of doubt, the Executive understands that this Section 6.1 prohibits the Executive from acting for himself or as an officer, employee, manager, operator, principal, owner, partner, shareholder, advisor, consultant of, or lender to, any individual or other Person that is engaged or participates in or carries out a Competing Business or is actively planning or preparing to enter into a Competing Business.  The parties agree that such prohibition shall not apply to the Executive’s passive ownership of not more than 5% of a publicly-traded company.  In the case of any violation of this non-competition clause, the Executive shall pay to the Company liquidated damages in the amount of CHF 29,469 for each instance of violation.  The payment of liquidated damages shall not discharge the Executive from observing this non-competition covenant.  In addition to the payment of liquidated damages and further damages incurred by the Company, the Company shall have the right to request the termination of any of the Executive’s activities which violate this non-competition covenant.

(b)In addition to the obligations described in Section 6.1(a) hereof (which obligations apply with respect to the period during which Executive is an employee of the Company), Executive shall also remain bound after the date hereof by the terms of the Non-Competition Agreement.  In connection with the foregoing and notwithstanding anything in this Agreement to the contrary, the Executive, the Company and AG expressly confirm their prior agreement as of November 20, 2014, (i) all rights and obligations of AG under the Non-Competition Agreement have been assigned (and Executive consents to such assignment) to the Company, (ii) the Non-Competition Agreement remains in full force and effect, with the “Employment Relationship” referenced in the Non-Competition Agreement being deemed to have continued (and to be uninterrupted) for purposes of the Non-Competition Agreement following the transition as of November 20, 2014of the Executive’s employment from AG to the Company, (iii) the Company shall have been deemed to have satisfied all payment obligations under Section 3 of the Non-Competition Agreement (which

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amounts were previously paid by AG), and (iv) in the event that Executive’s employment hereunder is terminated by the Company without Cause or as a result of Executive’s resignation for Good Reason, the Company shall have been deemed to have satisfied all payment and remuneration obligations referenced in Section 5 of the Non-Competition Agreement and the “Option” referenced in the Non-Competition Agreement shall be deemed to be exercised and fully paid-up thereunder.  

6.2No Solicitation or Interference.  So long as the Executive is an employee of the Company or any other member of the Company Group (other than while an employee acting solely for the express benefit of the Company Group) and for a twelve-month period thereafter, the Executive shall not, whether for his own account or for the account or benefit of any other Person, throughout the Prohibited Area:

 

(a)request, induce or attempt to influence (i) any customer of any member of the Company Group to limit, curtail, cancel or terminate any business it transacts with, or products or services it receives from or sells to, or (ii) any Person employed by (or otherwise engaged in providing services for or on behalf of) any member of the Company Group to limit, curtail, cancel or terminate any employment, consulting or other service arrangement, with any member of the Company Group. Such prohibition shall expressly extend to any hiring or enticing away (or any attempt to hire or entice away) any employee or consultant of the Company Group.

 

(b)solicit from or sell to any customer any products or services that any member of the Company Group provides or is capable of providing to such customer and that are the same as or substantially similar to the products or services that any member of the Company Group, sold or provided while the Executive was employed with, or providing services to, any member of the Company Group.

 

(c)contact or solicit any customer for the purpose of discussing (i) services or products that are competitive with and the same or closely similar to those offered by any member of the Company Group or (ii) any past or present business of any member of the Company Group.

 

(d)request, induce or attempt to influence any supplier, distributor or other Person with which any member of the Company Group has a business relationship or to limit, curtail, cancel or terminate any business it transacts with any member of the Company Group.

 

(e)otherwise interfere with the relationship of any member of the Company Group with any Person which is, or within one-year prior to the Executive’s date of termination was, doing business with, employed by or otherwise engaged in performing services for, any member of the Company Group.

 

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6.3Confidential Information.  During the period of the Executive’s employment with the Company or any member of the Company Group and at all times thereafter, the Executive shall hold in secrecy for the Company all Confidential Information that may come to his knowledge, may have come to his attention or may have come into his possession or control while employed by the Company (or otherwise performing services for any member of the Company Group).  Notwithstanding the preceding sentence, the Executive shall not be required to maintain the confidentiality of any Confidential Information which (a) is or becomes available to the public or others in the industry generally (other than as a result of disclosure or inappropriate use, or caused, by the Executive in violation of this Section 6.3) or (b) the Executive is compelled to disclose under any applicable laws, regulations or directives of any government agency, tribunal or authority having jurisdiction in the matter or under subpoena.  Except as expressly required in the performance of his duties to the Company under this Agreement, the Executive shall not use for his own benefit or disclose (or permit or cause the disclosure of) to any Person, directly or indirectly, any Confidential Information unless such use or disclosure has been specifically authorized in writing by the Company in advance.  During the Executive’s employment and as necessary to perform his duties under Section 1.1, the Company will provide and grant the Executive access to the Confidential Information.  The Executive recognizes that any Confidential Information is of a highly competitive value, will include Confidential Information not previously provided the Executive and that the Confidential Information could be used to the competitive and financial detriment of any member of the Company Group if misused or disclosed by the Executive.  The Company promises to provide access to the Confidential Information only in exchange for the Executive’s promises contained herein, expressly including the covenants in Sections 6.1, 6.2 and 6.4. 

 

6.4Inventions.

 

(a)The Executive shall promptly and fully disclose to the Company any and all ideas, improvements, discoveries and inventions, whether or not they are believed to be patentable (“Inventions”), that the Executive conceives of or first actually reduces to practice, either solely or jointly with others, during the Executive’s employment with the Company or any other member of the Company Group, and that relate to the business now or thereafter carried on or contemplated by any member of the Company Group or that result from any work performed by the Executive for any member of the Company Group.

 

(b)The Executive acknowledges and agrees that all Inventions shall be the sole and exclusive property of the Company (or member of the Company Group) and are hereby assigned to the Company (or applicable member of the Company Group).  During the term of the Executive’s employment with the Company (or any other member of the Company Group) and thereafter, whenever requested to do so by the Company, the Executive shall take such action as may be requested to execute and assign any and all applications, assignments and other instruments that the Company shall deem necessary or appropriate in order to apply for and obtain Letters Patent of the United States and/or of any foreign

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countries for such Inventions and in order to assign and convey to the Company (or any other member of the Company Group) or their nominees the sole and exclusive right, title and interest in and to such Inventions. 

 

(c)The Company acknowledges and agrees that the provisions of this Section 6.4 do not apply to an Invention: (i) for which no equipment, supplies, or facility of any member of the Company Group or Confidential Information was used; (ii) that was developed entirely on the Executive’s own time and does not involve the use of Confidential Information; (iii) that does not relate directly to the business of any member of the Company Group or to the actual or demonstrably anticipated research or development of any member of the Company Group; and (iv) that does not result from any work performed by the Executive for any member of the Company Group.

 

6.5Return of Documents and Property.  Upon termination of the Executive’s employment for any reason, the Executive (or his heirs or personal representatives) shall immediately deliver to the Company (a) all documents and materials containing Confidential Information (including without limitation any “soft” copies or computerized or electronic versions thereof) or otherwise containing information relating to the business and affairs of any member of the Company Group (whether or not confidential), and (b) all other documents, materials and other property belonging to any member of the Company Group that are in the possession or under the control of the Executive.  

 

6.6Reasonableness; Remedies.  The Executive acknowledges that each of the restrictions set forth in this Article VI are reasonable and necessary for the protection of the Company’s business and opportunities (and those of the Company Group) and that a breach of any of the covenants contained in this Article VI would result in material irreparable injury to the Company and the other members of the Company Group for which there is no adequate remedy at law and that it will not be possible to measure damages for such injuries precisely.  Accordingly, the Company and any member of the Company Group shall be entitled to the remedies of injunction and specific performance, or either of such remedies, as well as all other remedies to which any member of the Company Group may be entitled, at law, in equity or otherwise, without the need for the posting of a bond or by the posting of the minimum bond that may otherwise be required by law or court order.

 

6.7Extension; Survival.  The Executive and the Company agree that the time periods identified in this Article VI will be stayed, and the Company’s obligation to make any payments or provide any benefits under Article V shall be subject to a right of set-off, during the period of any breach or violation by the Executive of the covenants contained herein.  The parties further agree that this Article VI shall survive the termination or expiration of this Agreement for any reason.  The Executive acknowledges that his agreement to each of the provisions of this Article VI is fundamental to the Company’s willingness to enter into this Agreement and for it to provide for the severance and other benefits described in Article V, none of which the Company was required to do prior to the date hereof.  Further, it is the express intent and desire of the

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parties for each provision of this Article VI to be enforced to the fullest extent permitted by law.  If any part of this Article VI, or any provision hereof, is deemed illegal, void, unenforceable or overly broad (including as to time, scope and geography), the parties express desire is that such provision be reformed to the fullest extent possible to ensure its enforceability or if such reformation is deemed impossible then such provision shall be severed from this Agreement, but the remainder of this Agreement (expressly including the other provisions of this Article VI) shall remain in full force and effect.   

 

VII.MISCELLANEOUS

 

7.1Notices.  Any notice required or permitted under this Agreement shall be given in writing and shall be deemed to have been effectively made or given if personally delivered, or if sent via recognized overnight delivery service (e.g., FedEx, UPS, or DHL), all courier charges prepaid, or sent via confirmed e-mail or facsimile to the other party at its address set forth below in this Section 7.1, or at such other address as such party may designate by written notice to the other party hereto.  Any effective notice hereunder shall be deemed given on the date personally delivered, or one business day after it is sent via overnight delivery service or via confirmed e-mail or facsimile, as the case may be, to the following address:

 

If to the Company:

 

Orthofix International N.V.

Attn: General Counsel

3451 Plano Parkway
Lewisville, Texas 75056

Facsimile:  (214) 937-3096

E-mail: [email protected]

 

With a copy, which shall not constitute notice, to:

 

Hogan Lovells US LLP

555 Thirteenth Street, N.W.

Washington, D.C. 20004

Facsimile: (202) 637-5910

Email: [email protected]

 

If to the Executive:

 

Davide Bianchi

Chemin du Mont Blanc 4  

1272 Genolier,

Switzerland

 

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7.2Legal Fees. 

 

(a)The Company shall pay all reasonable legal fees and expenses of the Executive’s counsel in connection with the preparation and negotiation of this Agreement.  

 

(b)Any and all disputes arising from the employment relationship between the Company and the Executive, shall be settled exclusively by arbitration to be governed by ICC Rules (International Chamber of Commerce) and resolved by three (3) arbitrators appointed as follows: The Company shall jointly appoint one (1) arbitrator, the executive shall appoint one (1) arbitrator and the third arbitrator shall be appointed by the already appointed arbitrators.  The place of arbitration shall be Zug, Switzerland, and shall be conducted in the English language.

 

7.3Severability.  If an arbitrator or a court of competent jurisdiction determines that any term or provision hereof is void, invalid or otherwise unenforceable, (a) the remaining terms and provisions hereof shall be unimpaired and (b) such arbitrator or court shall replace such void, invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the void, invalid or unenforceable term or provision. For the avoidance of doubt, the parties expressly intend that this provision extend to Article VI of this Agreement.

 

7.4Entire Agreement; Termination of Existing Employment Agreement.  This Agreement shall supersede the Existing Employment Agreement as of the Effective Date, and from and after such Effective Date the Existing Employment Agreement shall be of no further force or effect.  Executive’s service as an officer of the Company (including as its President, Extremity Fixation) shall be uninterrupted by the termination of the Existing Employment Agreement and the effectiveness of this Agreement (i.e., Executive will remain seamlessly employed by the Company), and such termination of the Existing Employment Agreement and effectiveness of this Agreement shall not cause any severance payment or other termination-related payment or right to accrue pursuant to the Existing Employment Agreement.  For the avoidance of doubt, any accrued vacation that Executive has earned under the Existing Employment Agreement shall remain accrued under this Agreement, and Executive’s service to the Company under the Plans shall be deemed uninterrupted.  Subject to the foregoing, this Agreement, the Severance Agreement and the Non-Competition Agreement represents the entire agreement of the parties with respect to the subject matter hereof and shall supersede any and all previous contracts, arrangements or understandings between the Company, AG and the Executive relating to the Executive’s employment by the Company.  Nothing in this Agreement shall modify or alter any indemnity agreement between the Company and the Executive or alter or impair any of the Executive’s rights under the Plans or related award agreements.  In the event of any conflict between this Agreement and any other agreement between the Executive and the Company (or any other member of the Company Group), this Agreement shall control.

 

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7.5Amendment; Modification.  This Agreement may be amended at any time only by mutual written agreement of the Executive and the Company; provided, however, that, notwithstanding any other provision of this Agreement or the Plans (or any award documents under the Plans), the Company may reform this Agreement, the Plans (or any award documents under the Plans) or any provision thereof (including, without limitation, an amendment instituting a six-month waiting period before a distribution) or otherwise as contemplated by Section 7.16 below. 

 

7.6Withholding.  The Company shall be entitled to withhold, deduct or collect or cause to be withheld, deducted or collected from payment any amount of withholding taxes required by law, statutory deductions or collections with respect to payments made to the Executive in connection with his employment, termination (including Article V) or his rights hereunder, including as it relates to stock-based compensation.

 

7.7Representations.

 

(a)The Executive hereby represents and warrants to the Company that (i) the execution, delivery and performance of this Agreement by the Executive do not and shall not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which the Executive is a party or by which he is bound, and (ii) upon the execution and delivery of this Agreement by the Company, this Agreement shall be the valid and binding obligation of the Executive, enforceable in accordance with its terms.  

 

(b)The Company hereby represents and warrants to the Executive that (i) the execution, delivery and performance of this Agreement by the Company do not and shall not conflict with, breach, violate or cause a default under any material contract, agreement, instrument, order, judgment or decree to which the Company is a party or by which it is bound and (ii) upon the execution and delivery of this Agreement by the Executive, this Agreement shall be the valid and binding obligation of the Company, enforceable in accordance with its terms.

 

7.8Governing Law; Jurisdiction.  This Agreement is subject to Swiss law.  Except as otherwise provided in Section 7.2, all actions or proceedings arising out of this Agreement shall exclusively be heard and determined in courts in Zug, Switzerland having appropriate jurisdiction.  The parties expressly consent to the exclusive jurisdiction of such courts in any such action or proceeding and waive any objection to venue laid therein or any claim for forum nonconveniens.

 

7.9Successors.  This Agreement shall be binding upon and inure to the benefit of, and shall be enforceable by the Executive, the Company, and their respective heirs, executors, administrators, legal representatives, successors, and assigns.  In the event of any assignment of this Agreement by the Company, the Company shall remain

13

  

 


 

primarily liable for its obligations hereunder. The Executive expressly acknowledges that the members of the Company Group (and their successors and assigns) are third-party beneficiaries of this Agreement and may enforce this Agreement on behalf of themselves or the Company.  Both parties agree that there are no third-party beneficiaries to this Agreement other than as expressly set forth in this Section 7.9. 

 

7.10Nonassignability.  Neither this Agreement nor any right or interest hereunder shall be assignable by the Executive, his beneficiaries, dependents or legal representatives without the Company’s prior written consent; provided, however, that nothing in this Section 7.10 shall preclude (a) the Executive from designating a beneficiary to receive any benefit payable hereunder upon his death or (b) the executors, administrators or other legal representatives of the Executive or his estate from assigning any rights hereunder to the Person(s) entitled thereto.

 

7.11No Attachment.  Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation, sale, assignment, encumbrance, charge, pledge or hypothecation in favor of any third party, or to execution, attachment, levy or similar process or assignment by operation of law in favor of any third party, and any attempt, voluntary or involuntary, to effect any such action shall be null, void and of no effect.

 

7.12Waiver.  No term or condition of this Agreement shall be deemed to have been waived, nor there be any estoppel against the enforcement of any provision of this Agreement, except by written instrument of the party charged with such waiver or estoppel.  No such written waiver shall be deemed a continuing waiver unless specifically stated therein, and each such waiver shall operate only as to the specific term or condition waived and shall not constitute a waiver of such term or condition for the future or as to any act other than that specifically waived.

 

7.13Construction.  The headings of articles or sections herein are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions of this Agreement.  References to days found herein shall be actual calendar days and not business days unless expressly provided otherwise.

 

7.14Counterparts.  This Agreement may be executed by any of the parties hereto in counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same instrument.

 

7.15Effectiveness. This Agreement shall be effective as of the Effective Date when signed by the Executive and the Company.

 

7.16Code Section 409A.

 

(a)Although the parties hereto do not expect payments hereunder to be subject to U.S. income taxation, in the event such U.S. income taxation were to apply to any payments hereunder, it is the intent of the parties that payments and

14

  

 


 

benefits under this Agreement comply with Section 409A and, accordingly, to interpret, to the maximum extent permitted, this Agreement to be in compliance therewith.  If the Executive notifies the Company in writing  (with specificity as to the reason therefore) that the Executive believes that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Section 409A and the Company concurs with such belief or the Company (without any obligation whatsoever to do so) independently makes such determination, the parties shall, in good faith, reform such provision to try to comply with Code Section 409A through good faith modifications to the minimum extent reasonably appropriate to conform with Code Section 409A.  To the extent that any provision hereof is modified by the parties to try to comply with Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent of the applicable provision without violating the provisions of Code Section 409A.  Notwithstanding the foregoing, the Company shall not be required to assume any economic burden in connection therewith. 

 

(b)If the Executive is deemed on the date of “separation from service” to be a “specified employee” within the meaning of that term under Section 409A(a)(2)(B), then, with regard to any payment or the provision of any benefit that is specified as subject to this Section, such payment or benefit shall, if required to avoid the imposition of additional tax or interest under Section 409A, be made or provided at the date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Executive, and (B) the date of the Executive’s death (the “Delay Period”).  Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 7.16 (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.  If a payment is to be made promptly after a date, it shall be made within sixty (60) days thereafter.  

 

(c)Any expense reimbursement under this Agreement shall be made promptly upon Executive’s presentation to the Company of evidence of the fees and expenses incurred by the Executive and in all events on or before the last day of the taxable year following the taxable year in which such expense was incurred by the Executive, and no such reimbursement or the amount of expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year.

 

7.17Survival.  Articles VI and VII shall survive the termination or expiration of this Agreement for any reason.    

 

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.

 

 

 

ORTHOFIX INTERNATIONAL N.V.

 

 

 

/s/ Bradley R. Mason

Bradley R. Mason

Chief Executive Officer

 

EXECUTIVE

 

 

 

/s/ Davide Bianchi

Davide Bianchi

an Individual

 

 

 

 

 

 

 

ORTHOFIX AG

 

 

 

/s/ Armin L. Landtwing

Name:Armin L. Landtwing

Title:  _Verwaltungsrat_________________

 

 

 

16

  

 


 

 

 

EXHIBIT A

Definitions

For purposes of this Agreement, the following capitalized terms have the meanings set forth below:

Boardshall mean the Board of Directors of the Company. Any obligation of the Board other than termination for Cause under this Agreement may be delegated to an appropriate committee of the Board, including the Compensation Committee, and references to the Board herein shall be references to any such committee, as appropriate.

Causeshall have the meaning set forth in the Severance Agreement.

Code shall mean the Internal Revenue Code of 1986, as amended.

 

Company Groupshall mean the Company, together with its direct and indirect subsidiaries.

Compensation Committeeshall mean the Compensation Committee of the Board.

Competing Business means any business or activity that (i) competes with any member of the Company Group for which the Executive performed services or the Executive was involved in for purposes of making strategic or other material business decisions and involves (ii) (A) the same or substantially similar types of products or services (individually or collectively) manufactured, marketed or sold by any member of the Company Group during Term or (B) products or services so similar in nature to that of any member of the Company Group during Term (or that any member of the Company Group will soon thereafter offer) that they would be reasonably likely to displace substantial business opportunities or customers of the Company Group.

“Confidential Information shall include Trade Secrets and includes information acquired by the Executive in the course and scope of his activities under this Agreement, including information acquired from third parties, that (i) is not generally known or disseminated outside the Company Group (such as non-public information), (ii) is designated or marked by any member of the Company Group as “confidential” or reasonably should be considered confidential or proprietary, or (iii) any member of the Company Group indicates through its policies, procedures, or other instructions should not be disclosed to anyone outside the Company Group.  Without limiting the foregoing definitions, some examples of Confidential Information under this Agreement include (a) matters of a technical nature, such as scientific, trade or engineering secrets, “know-how”, formulae, secret processes, inventions, and research and development plans or projects regarding existing and prospective customers and products or services, (b) information about costs, profits, markets, sales, customer lists, customer needs, customer preferences and customer purchasing histories, supplier lists, internal financial data, personnel evaluations, non-public information about medical devices or products of any member of the Company Group (including future plans about them), information and material provided by third parties in confidence and/or with nondisclosure restrictions, computer access passwords,

  

 


 

and internal market studies or surveys and (c) and any other information or matters of a similar nature.

“Disability” shall have the meaning set forth in the Severance Agreement.  

Exchange Act shall mean the Securities Exchange Act of 1934, as amended.

Good Reasonshall have the meaning set forth in the Severance Agreement.

 

Personshall include individuals or entities such as corporations, partnerships, companies, firms, business organizations or enterprises, and governmental or quasi-governmental bodies.

Prohibited Area means North America, South America and the European Union, which Prohibited Area the parties have agreed to as a result of the fact that those are the geographic areas in which the members of the Company Group conduct a preponderance of their business and in which the Executive provides substantive services to the benefit of the Company Group.

Section 409A shall mean Section 409A of the Code and regulations promulgated thereunder (and any similar or successor federal or state statute or regulations).

Trade Secrets are information of special value, not generally known to the public that any member of the Company Group has taken steps to maintain as secret from Persons other than those selected by any member of the Company Group.  


    

 


 

EXHIBIT B

Non-Competition Agreement

    

 


 

OPZIONE PER UN PATTO DI NON CONCORRENZA

 

Tra

 

Orthofix AG

c/o ALLconsultServices

Bundesstrasse 3

CH-6304 Zug

 

E

 

Il Mr. Davide Bianchi, residente in Ch. Du Mont Blanc 4, 1272 Genolier, Vaud- Svizzera (di seguito “Dirigente”)

 

Di seguito denominate “le Parti”

Premesso che

 

i)La Società e il Gruppo cui essa appartiene (con il termine “Gruppo” si intende includere la Società, la sua controllante e tutte le società dalle stesse direttamente o indirettamente controllate o partecipate) ricoprono una posizione leader a livello mondiale nel settore delle Tecnologie Medicali. In particolare il Gruppo si occupa di sviluppo, della produzione, e della vendita di prodotti nei seguenti segmenti del mercato: tutti i prodotti alla gamma di « Extremity Fixation »

ii)il Dirigente è stato assunto dalla Società dal giorno 22 July 2013 con la posizione di Presidente Internazionale della fissazione esterna (di seguito il “Rapporto di Lavoro”;

iii)nel corso del Rapporto di Lavoro il Dirigente verrà a conoscenza di informazioni riservate riguardanti la

Società e il Gruppo, nonché i prodotti della Società e del Gruppo, che rivestono primaria importanza per lo svolgimento dell’attività di impresa della Società; 

iv)la Società e il Gruppo intendono tutelare i loro interessi in relazione alle attività e agli incarichi che il Dirigente potrebbe svolgere in concorrenza con la Società successivamente alla cessazione del Rapporto di Lavoro.

 

 

 

OPTION OF NON-COMPETITION AGREEMENT

 

Between

 

Orthofix AG

c/o ALLconsultServices

Bundesstrasse 3

CH-6304 Zug

 

And

 

Il Mr. Davide Bianchi, residente in Ch. Du Mont Blanc 4, 1272 Genolier, Vaud- Svizzera (below “Manager”)

 

Hereinafter mentioned as  “Parties”

WHEREAS

 

i)The Company and the Group to which it belongs, (Group intended to include the Company, its holding company, and all companies directly or indirectly controlled by the same or associated), cover a worldwide leading position in the field of Medical Technologies. In particular, the Group is engaged in the development, production and sales of products in the following market sector: all products in the Product Range “Extremity Fixation”

ii)The Manager has been employed by the Company since 22 July 2013, for the position of President of International Extremity Fixation (hereinafter  “The Employment Relationship”);

iii)In the course of the Employment Relationship Manager will be aware of confidential information regarding the Company and the Group, as well as the products of the Company and the Group, which are of major importance for the conduct of the business of the Company;

 

iv)The Company and the Group wish to protect their interests in relation to  the activities and the tasks that the Manager could carry out in competition with the Company subsequent to the termination of the Employment Relationship .

 

 

Ciò premesso, le Parti convengono quanto segue:

 

1)OPZIONE- EFFICACIA E CONDIZIONE SOSPENSIVA:

1.1.Il Dirigente concede alla Società un’opzione per la conclusione di un patto di non concorrenza nei termini e alle condizioni specificati al successivo paragrafo 4 (qui di seguito l’Opzione).

1.2.La Società accetta l’Opzione e si impegna ad esercitarla nei termini e alle condizioni specificati al successivo paragrafo 2.

 

 

Accordingly the Parties agree as follows:

 

1)OPTION- EFFECTIVENESS AND SUSPENSION CONDITION:

1.1.The Manager, grants to the Company an option for the conclusion of a non-competition agreement, under  the terms and conditions  specified in the following paragraph 4 (hereinafter “the Option”);

1.2.The Company accepts and agrees to exercise    the option according to the terms and condition specified in paragraph 2.

 

2)ESERCIZIO DELL’OPZIONE

2.1 La Società potrà esercitare l’Opzione in ogni momento nel corso del Rapporto di Lavoro.

2.2. La volontà della Società di esercitare l’Opzione e, di conseguenza, di concludere il patto di non concorrenza di cui al successivo paragrafo 4, dovrà essere comunicata ad Dirigente per iscritto.

 

 

 

2)OPTION EXERCISE

2.1 The Company may exercise  the option at  any time during the Employment Relationship;

2.2. The intention of the Company to exercise  the Option and, therefore, to conclude the non-competition agreement, referred to in paragraph 4, shall be notified to the manager in written form.

 

 

    

 


 

3)CORRISPETTIVO PER L’OPZIONE

 

       A titolo di corrispettivo per la concessione dell’Opzione  la Società Le corrisponderà un importo lordo pari a Euro

5000,--, in tre tranche di uguale importo e unitamente alle competenze dei tre mesi successivi alla sottoscrizione della presente Opzione. Resta inteso e convenuto che il predetto importo si intende già comprensivo di ogni incidenza su tutti gli istituti contrattuali e di legge,  e che non sarà considerato retribuzione utile ai fini del calcolo del Trattamento di Fine Rapporto e degli istituti ad esso collegati.

 

 

 

3)PAYMENT AGREEMENT

 

For the grant of the Option, the Company will correspond a gross amount of € 5,000.00, in three installments each of the same amount and together with the payment of three months’ remuneration after the signature of the present otion. It is agreed that said  amount already includes any effect on  any contractual and legal obligations, and that compensation will not be considered useful for the calculating severance indemnities and institutions connected to it.

 

 

    

 


 

4)REGOLAMENTAZIONE DEL PATTO DI NON CONCORRENZA

4.1 Qualora la Società eserciti l’Opzione secondo i termini e alle condizioni di cui al precedente paragrafo 2, per un periodo di 12 mesi (dodici) decorrente dalla data di effettiva cessazione del Rapporto di Lavoro (a prescindere dalle ragioni di tale cessazione) il Dirigente si impegna a non prestare la sua opera, direttamente o indirettamente, in favore di soggetti terzi, né a svolgere attività in qualità di titolare, socio, dipendente, lavoratore autonomo o agente, nel campo dei Orthofix prodotti alla gamma di « Extremity Fixation »su tutto il territorio dell’Unione Europea e degli Stati Uniti d’America.

 

4.2. Il Dirigente si impegna inoltre a non distrarre e/o stornare clienti con i quali ella abbia trattato, direttamente o indirettamente, negli ultimi tre anni del Rapporto di Lavoro. Il Dirigente si asterrà altresì dal distrarre e/o stornare dipendenti o altri collaboratori della Società, nonché dall’indurli a cessare il loro rapporto di collaborazione con la Società stessa.

 

4.3. Al fine di consentire alla Società un adeguato controllo sul rispetto del patto di non concorrenza da parte del Dirigente, quest’ultimo si impegna a fornire alla Società tutte le informazioni rilevanti riguardanti le attività lavorative e

professionali che la stessa svolgerà durante il periodo di validità del patto di non concorrenza. Tali informazioni verranno comunicate per iscritto e anteriormente all’effettivo svolgimento delle predette attività. Il Dirigente si impegna altresì ad informare anticipatamente il proprio nuovo datore di lavoro e/o committente dell’esistenza del presente patto di non concorrenza, del quale il Dirigente è autorizzato a fornire copia.

 

4.4. Ogni singola violazione, da parte del Dirigente, degli obblighi di non concorrenza di cui al presente paragrafo 4, comporterà il pagamento, da parte del Dirigente stesso, di una penale pari ad Euro 150.000 senza alcun pregiudizio per il diritto della Società al risarcimento dell’eventuale maggior danno. Al verificarsi della violazione, e fermo restando il pagamento della penale di cui sopra, la Società avrà la facoltà di risolvere il patto di non concorrenza per inadempimento o di continuare a chiederne il corretto adempimento da parte del Dirigente. In questo caso è fatto salvo il diritto del Dirigente al corrispettivo ancora eventualmente dovuto ai sensi del successivo paragrafo 5.1. In caso di risoluzione, il Dirigente, oltre a corrispondere la penale di cui sopra, sarà tenuta a restituire alla Società il corrispettivo eventualmente già percepito ai sensi di quanto previsto al successivo paragrafo 5.1.

 

4.5 Resta inteso che la Società potrà decidere di non esercitare l’Opzione. In questo caso, il patto di non concorrenza come regolato al presente paragrafo 4 non entrerà in vigore e non produrrà nessun effetto, e al dirigente non spetterà alcun corrispettivo ai sensi di quanto previsto al successivo paragrafo 5.1.

 

 

 

4)REGULATION OF NON-COMPETITION AGREEMENT

4.1. If the Company exercises the Option in accordance with the terms and conditions referred to paragraph in 2 above, for a period of 12 months (twelve months) from the effective date of termination  of the Employment Relationship (independently from  the reason of termination  of the employment relation) the Manager  agrees not to provide his work, directly or indirectly, in favor of third parties, or engage as owner, partner, employee, self-employed or agent, in the field of the Orthofix Portfolio “Extremity Fixation” on the whole territory of the European Union and the United States of America.

 

4.2  The Manager  agrees not to distract  or divert a customer to whom he has dealt with, directly or indirectly, in the last three years of the Employment Relationship.. The Manager will also refrain from distracting and/or divert employees or other employees of the Company and from inducing them to cease their relationship with the Company.

 

4.3. In order to allow the Company an adequate monitoring compliance with the non-competition agreement by the Manager, the latter undertakes to provide the Company with all relevant information concerning the business and professional activities that take place during the same period of validity of the non-competition agreement.

These informations have to be communicated in written form and prior to  the actual  performance  of said activities. The Manager has to inform in advance his new employer of the existence of this non-competition agreement. The Manager is authorized to provide a copy of this contract to his employer.

 

4.4. For each violation incurred by the Manager, of this non-compete option, according to what referred to in this paragraph 4, the Manager will pay to the Company, a penalty of Euros 150,000.00 without prejudice to compensation for further damages to the Company. Upon occurrence of the violation, and without prejudice of payment of the abovementioned penalty, The Company will have the right to terminate the non-competition agreement for non-performance or to continue to ask for the proper performance by the Manager.. In this case, the Manager is entitled to the payment, as defined in paragraph 5.1..

In case of termination of the contract, the Manager will have to pay the penalty, and will have to return back to the Company the amount he has already received under the provisions of paragraph 5.1.

 

4.5. It is understood that the Company may decide not to exercise the option. In this case, the non-competition agreement, as regulated in this Paragraph 4, will not produce any effect, and the Manager will  not receive any payment, as defined in paragraph 5.1.

 

    

 


 

 

5)CORRISPETTIVO PER IL PATTO DI NON CONCORRENZA 

5.1 Tenuto conto del background professionale del Dirigente, le Parti convengono che un corrispettivo per il predetto patto di non concorrenza pari al 70% della retribuzione fissa annua lorda in vigore al momento della cessazione del Rapporto di lavoro, sia equo e ragionevole.

 

5.2. Il corrispettivo di cui al presente paragrafo 5.1. verrà corrisposto in due rate di pari importo come segue:

- il 50% entro e non oltre sette mesi dalla data di entrata in vigore del patto;

- il residuo 50% entro e non oltre il mese successivo alla data di termine del patto.

 

 

 

 

5)PAYMENT FOR NON-

COMPETITION AGREEMENT

5.1. According to the professional background of the Manager, the Parties agree that a remuneration for the non-competition agreement of 70% of annual gross salary in force at the time of the termination of the employment relationship, is fair  and reasonable.

 

5.2. The remuneration, referred to in this paragraph 5.1., will be paid in two installments  as follows:

- 50% no later than seven months from the date of entry into force of the agreement;

- The remaining 50% within and no later than the month following the date of termination of the agreement.

 

 

 

 

Date:  November 26, 2013

 

Date:  November 18, 2013

 

ORTHOFIX AG

 

 

/s/ Armin L. Landtwing

 

/s/ Davide Bianchi

Armin L. Landtwing    

Verwaltungsrat                    

 

Davide Bianchi

 

 

 

 

 

 

 

/s/ Brad Mason

 

 

Brad Mason

CEO Orthofix International

 

 

 

 

 

 

 

    

 



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