Exhibit 10.37

 

 

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December 4, 2019

 

 

Kevin Kenny

 

Offer Letter

 

Dear Kevin,

 

It gives me great pleasure to present this offer of employment with Orthofix
Medical, Inc. (with its subsidiaries and affiliates, “Orthofix”).  

 

Position:  The position we are offering you is that of President of Global
Spine, reporting to Orthofix’s President and Chief Executive Officer.  

 

Start Date:  Your start date will be on December 4, 2019.

 

Base Salary:  Your base salary will be $440,000 per year (the “Base Salary”),
less applicable deductions and tax withholdings.  

 

Annual Bonus:  Subject to Orthofix policies and satisfaction of applicable
performance criteria, you will be eligible to participate in the annual bonus
program, with a target bonus opportunity of 70% of your Base Salary.  Your 2019
annual bonus will be pro-rated based on your start date.  

 

Sign-On Equity Award:  As an inducement to and incentive for accepting this
position, you will be eligible to receive a grant, effective as of your start
date, under Orthofix’s 2012 Long-Term Incentive Plan of (i) stock options to
purchase shares of Orthofix common stock, valued at $450,000 (based on the
Black-Scholes value of Orthofix common stock on the grant date, subject to
rounding to the nearest whole share) and (ii) restricted stock units with
respect to shares of Orthofix common stock, valued at $450,000 (based on the
closing price of Orthofix common stock on the grant date, subject to rounding to
the nearest whole share), in each case vesting in 25% increments on each of the
first four anniversaries of your start date, subject to your continued service
with Orthofix on each such vesting date.  The sign-on equity awards are
contingent upon and issued only upon approval by Orthofix’s Board of Directors
and will be subject to the terms and conditions of applicable award agreements,
which will be made available to you shortly after approval of your awards by
Orthofix’s Board of Directors.  

 

Sign-On Short Term Cash Incentive Award:  As an inducement for accepting this
position, you will receive two time-based cash incentive awards in total value
of $200,000.  The first award of $100,000, less applicable deductions and tax
withholdings, will be payable in the first available payroll after your Start
Date.  The second award of $100,000, less applicable

Orthofix, Inc. | 3451 Plano Parkway | Lewisville, TX 75056 | 214.937.2000

www.orthofix.com

  

  

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Exhibit 10.37

deductions and tax withholdings, will be payable in the first available payroll
after 12 continuous months of service.  These awards are subject to pro-rata
clawback provisions should you voluntarily leave employment or you are
terminated for cause within 12 months of receiving each award.

 

Equity Incentives:  You will also be eligible to receive future, annual equity
incentive awards.  Any future equity incentive awards are contingent upon and
issued only upon approval by Orthofix’s Board of Directors (or Compensation
Committee) and will be subject to the terms and conditions of applicable plan
documents and award agreements. The incentive value for the 2020 annual
incentive award is anticipated to be approximately $800,000, but will be subject
to Compensation Committee review and approval.

 

Benefits:  Orthofix will offer you medical, dental, and vision insurance,
effective the first of the month after your first 30 days of employment.  You
will also be eligible to participate in the Orthofix 401(k) retirement plan as
of the first of the month after your first 30 days of employment.  This plan
currently provides an employer match of 100% for the first 2% contribution and
50% for the next 4% contribution.  A more detailed explanation of these benefits
and other benefits will be provided to you under separate cover.  Orthofix
defers to the provisions of its employee benefits plans, which plans shall
govern to the extent of any conflict and which plans may be changed unilaterally
by Orthofix.  

 

Location and Residency:  Your position will be based in Orthofix’s Lewisville
offices.  As such, Orthofix will provide support in establishing residency in
the Lewisville, Texas area and you will receive a one-time cash payment of
$175,000, less applicable deductions and tax withholdings, payable in the first
available payroll after your Start Date, for you to apply in your discretion to
the purchase of a new home in the Lewisville, Texas areas.  This one-time cash
payment of $175,000 is subject to a full clawback should you voluntarily leave
employment or you are terminated for cause within 24 months of the Start Date.
Additionally, Orthofix will also provide reimbursement (upon submission of
applicable supporting documentation) for a house-hunting trip with your spouse,
for closing costs on the purchase of a home, for the move of household goods and
two automobiles, and a temporary housing monthly stipend of $3,000 (net) for
temporary housing in the Lewisville, Texas area for up to six months. Relocation
expenses will be grossed up for the value using the Company’s standard gross-up
formula for the expected tax liability of these expenses.  

  

Third-Party Confidentiality/Non-Compete Obligations:  Orthofix recognizes that,
while you were employed with your prior employers, you may have been exposed to
confidential, proprietary, and/or trade secret information (“Third-Party
Confidential Information”).  Moreover, Orthofix recognizes that you have a legal
duty and may have a contractual duty not to use or disclose Third-Party
Confidential Information outside of your employment with your former
employers.   Orthofix also recognizes that you may owe your former employers a
contractual duty not to solicit certain customers (“Restricted
Customers”).  Orthofix has no intention of obtaining any Third-Party
Confidential Information in any form.  In fact, Orthofix’s expectation is that
you will abide by, and comply fully with, the terms of any agreements you may
have with respect to such information.  By signing below, you represent and
warrant that you have complied, and will comply, with any such obligations,
including, but not limited to, all confidentiality, non-

Orthofix, Inc. | 3451 Plano Parkway | Lewisville, TX 75056 | 214.937.2000

www.orthofix.com

  

  

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Exhibit 10.37

 

solicitation, non-competition, and post-employment disclosure obligations.  You
further represent and warrant that you have not misappropriated any Third-Party
Confidential Information and, to the extent you may have access to such
information, you will not disclose or use it for any purpose contrary to the
terms of any agreements you may have with respect to such information, or to
benefit Orthofix in any way.

 

Orthofix also wishes to ensure that you are not placed in a position which might
require you to solicit Restricted Customers or cause the disclosure or use of
Third-Party Confidential Information, either intentionally or inadvertently. 
For this reason, this offer is contingent upon the legal department’s review of
any agreements you may have with a current or former employer or business
partner, and Orthofix reserves the right to rescind the offer if it determines,
in its sole discretion, that you have continuing obligations to a current or
former employer or business partner that could restrict or interfere with the
responsibilities Orthofix anticipates you performing on its behalf.  If you are
ever involved in any job situation which could require you to solicit Restricted
Customers or cause you to use or disclose any Third-Party Confidential
Information, you agree to immediately notify Orthofix’s Chief Legal Officer and
advise Orthofix’s Chief Legal Officer of your concerns.  In the event it is
determined that a risk of improper solicitation, disclosure, or use does exist,
Orthofix will take appropriate measures.

 

Orthofix is also serious about protecting its own confidential, proprietary,
and/or trade secret information.  Accordingly, this offer of employment is
contingent upon your execution of a confidentiality, non-competition, and
inventions agreement (a “Restrictive Covenant Agreement”).

 

Testing and Screening:  This offer is contingent on the successful completion of
a drug test and background screening.  The drug screen must be completed within
96 hours of accepting this offer.  If the drug screen is not completed by the
designated date, we reserve the right to rescind the offer.    

 

Work Eligibility:  Federal law requires all employees to provide their employers
with verification of identity and eligibility to work in the United States
within the first three (3) days of employment.  All employees are required to
show one or more forms of identification as a means of verification.  This offer
of employment is contingent upon your return of the necessary documentation to
Orthofix within three days of your first day of employment with a copy of the
acceptable identification you choose to present.

 

Employment-At-Will:  You understand and acknowledge that, if you become employed
by Orthofix, you will be an “at-will” employee at all times during your
employment.  As an at-will employee, both Orthofix and you will have the right
to terminate your employment at any time, with or without cause, and with or
without notice.  At-will employment also means that your job duties, title,
compensation, and benefits, as well as the company personnel policies and other
procedures, may be changed or terminated at the sole discretion of Orthofix at
any time.  Please note that, while this offer letter summarizes your anticipated
terms and conditions of employment with Orthofix, they may change, and it is not
an employment contract.  

 

Orthofix, Inc. | 3451 Plano Parkway | Lewisville, TX 75056 | 214.937.2000

www.orthofix.com

  

  

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Exhibit 10.37

Governing Law:  This offer letter shall be governed by and construed in
accordance with the laws of the State of Texas, without regard to its principles
of conflicts of laws.

 

Other Agreements:  Under separate cover, you will receive a Change in Control
and Severance Agreement, and an Indemnity Agreement (the “Other
Agreements”).  Kindly return one signed copy of this offer letter and each Other
Agreement.

 

Acceptance:  Your signature at the end of this offer letter constitutes an
acceptance of this offer and confirms that no promises, representations, or
agreements that are inconsistent with any of the terms of this offer letter have
been made to or with you by anyone at Orthofix.  You also acknowledge and agree
that no modification of the terms and conditions set forth in this offer letter
can be made without the written authorization of Orthofix’s President and Chief
Executive Officer or Orthofix’s Compensation Committee.

 

This offer of employment will remain open until December 3, 2019.

 

Kevin, we look forward to working with you.  Your experience, background and
leadership will be a significant asset to Orthofix.  

 

Sincerely,

 

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Suzanne Armstrong

Vice President, Human Resources

 

 

 

ACKNOWLEDGED, ACCEPTED, AND AGREED:

 

 

 

/s/ KEVIN KENNYDate    December 4, 2019

Kevin Kenny

Orthofix, Inc. | 3451 Plano Parkway | Lewisville, TX 75056 | 214.937.2000

www.orthofix.com