Unassociated Document


    
      

    


    Exhibit
      10.24

    


    


    EMPLOYMENT
      AGREEMENT

    


    This
      Employment Agreement (the “Agreement”)
      is by
      and between Blackstone Medical, Inc., a Massachusetts corporation (the
“Company”),
      and
      Matthew V. Lyons, an individual (the “Executive”).
      

    


    PRELIMINARY
      STATEMENTS

    


    A.    The
      Company and the Executive are parties to a previous Employment Agreement
      effective January 1, 2004 (the “Prior
      Agreement”),
      but
      desire to terminate the Prior Agreement and enter into this written Agreement
      to
      memorialize the new terms of their relationship in light of the Company’s merger
      with New Era Medical Corp., as delineated in the Agreement and Plan of Merger
      dated on or about August 4, 2006 (the “Merger
      Agreement”).
      This
      Agreement shall become effective on the date of closing of the merger delineated
      in the Merger Agreement (the “Effective
      Date”).
      In
      the event that the merger delineated in the Merger Agreement does not close,
      then this Agreement shall have no effect and the Company and the Executive
      will
      continue with their obligations and relationship terms memorialized in the
      Prior
      Agreement.

    


    B.    The
      Executive understands and agrees that the Executive’s entry into this Agreement
      is a material inducement and condition to the execution and delivery of the
      Merger Agreement by the parties to the Merger Agreement.

    


    C.    The
      Executive desires to render such services, upon the terms and conditions
      contained herein.

    


    D.    The
      Company and the Executive agree and acknowledge that pursuant to this Agreement
      the Executive will receive consideration and other benefits over and above
      that
      which he was entitled to receive under the Prior Agreement and over and above
      that which he would otherwise be entitled to receive as compensation for
      services performed for the Company.

     

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

     

    I.    EMPLOYMENT
      AND DUTIES

    


    1.1   Duties.
      The
      Company hereby employs the Executive as an employee, and the Executive agrees
      to
      be employed by the Company, upon the terms and conditions set forth herein.
      While serving as an employee of the Company, the Executive shall serve as
      President - Orthofix Spine. The Executive shall have such power and authority
      and perform such duties, functions and responsibilities as are associated with
      and incident to such position, and as the Company may from time to time require
      of him.


    
      
        
        

      

      
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    1.2   Services.
      During
      the Term (as defined in Section 1.3), and excluding any periods of vacation,
      sick leave or disability, the Executive agrees to devote his full business
      time,
      attention and efforts to the business and affairs of the Company. During the
      Term, it shall not be a violation of this Section 1.2 for the Executive to
      (a)
      serve on civic or charitable boards or committees (but not corporate boards),
      (b) deliver lectures or fulfill speaking engagements or (c) manage personal
      investments, so long as such activities do not interfere with the performance
      of
      the Executive’s responsibilities in accordance with this Agreement. The
      Executive must request the Company’s prior written consent to serve on a
      corporate board, which consent shall be at the Company’s reasonable discretion
      and only so long as such service does not
      interfere with the performance of his responsibilities hereunder.

    


    1.3   Term
      of Employment.
      The
      term of this Agreement shall commence on the Effective Date and shall continue
      until a date two years after the Effective Date (the “Term”)
      unless
      sooner terminated or extended as provided hereunder. In the event that the
      Executive continues to be employed by the Company after the Term, unless
      otherwise agreed by the parties in writing, such continued employment shall
      be
      on an at-will basis upon terms agreed upon at such time without regard to the
      terms and conditions of this Agreement and this Agreement shall be deemed
      terminated at the end of the Term, regardless of whether such employment
      continues at-will, other than Articles VI and VII, which shall survive the
      termination or expiration of this Agreement for any reason.

    


    II.    COMPENSATION

     

    2.1   General.
       The
      Base
      Salary (as defined in Section 2.2) and the Incentive Compensation (as defined
      in
      Section 2.3.) payable to the Executive hereunder, as well as any other
      compensation (if any), shall be determined from time to time by the Company
      and
      paid pursuant to the Company’s customary payroll practices or in accordance with
      the terms of any applicable Company policies, written plans, or written
      agreements. The
      Company shall pay the Executive in cash, in accordance with the normal payroll
      practices of the Company, the base salary and Incentive Compensation set forth
      below. The Company may also withhold from any of the Executive’s compensation,
      in whatever form, under this Agreement any amount required by law or necessary
      for the Executive’s elected participation in any Company benefit
      plan(s).

    


    2.2   Base
      Salary.
      The
      Executive shall be paid a base salary (“Base Salary”) of no less than $21,666.67
      per month ($260,000.00 on an annualized basis) while he is employed by the
      Company during the Term;
      provided,
      however,
      that
      nothing shall prohibit the Company from reducing the Base Salary as part of
      an
      overall cost reduction program that affects all senior executives of the Company
      and does not disproportionately affect the Executive,
      so long
      as such reductions do not reduce the Base Salary to a rate that is less than
      90%
      of the minimum Base Salary amount set forth above (or, if the minimum base
      salary amount has been increased during the Term, 90% of such increased
      amount).

    


    2.3   Bonus
      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 in an amount based on
      reasonable goals for the earning of such compensation as may be determined
      by
      the Company from time to time (the “Goals”).
      Amounts that may be earned upon attainment of all
      reasonably achievable annual Goals will be targeted to equal not less than
      40%
      of the annual base salary in such fiscal year. The amount of any actual payment
      under this Section 2.3 will depend upon the achievement (or not) of the various
      performance metrics comprising the Goals. If employed for a partial year, the
      Executive shall be eligible to receive only a pro rata portion of any bonus
      amounts annualized for that year. Amounts payable under this Section 2.3 shall
      be determined by the Company, at its sole discretion, and shall be payable
      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 Company may establish from time to time in its
      sole discretion. Any bonus or incentive compensation under this Section 2.3
      or
      otherwise is referred to herein as “Incentive
      Compensation.”


    
      
        
        

      

      
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    III.    EMPLOYEE
      BENEFITS

    


    3.1   General.
      Subject
      only to any post-employment rights under Article V, 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 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).

    


    3.2   Savings
      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 available to senior executives of the Company.

    


    3.3   Welfare
      and Other Benefits.
      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 and other
      benefits at a level that is available to other senior executives of the
      Company.

    


    3.4   Vacation.
      The
      Executive shall be entitled to 3 weeks paid vacation per 12-month period.


    


    3.5   Car
      Allowance.
      The
      Executive shall be entitled to a car allowance of $900.00 per month while he
      is
      employed by the Company during the Term on the same basis as other employees
      of
      the Company. 

    


    3.6   Expenses.
      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 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. 


    
      
        
        

      

      
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    3.7   Key
      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 pursuant to Section 5.1 of this Agreement due to his death or
      Disability. 

    


    IV.    TERMINATION
      OF EMPLOYMENT

     

    4.1   Termination
      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.

    


    4.2   Death.
      The
      Executive’s employment hereunder shall terminate upon his death and no further
      compensation will be due to the Executive except for the Executive’s unpaid Base
      Salary owed through the employment termination date.

     

    4.3   Termination
      Without Cause.
      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 30 days
      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 under
      the
      Agreement. The Notice of Termination need not state any reason for termination
      and such termination can be for any reason or no reason. The date of termination
      shall be the date set forth in the Notice of Termination.

     

    4.4   Termination
      With Cause.
      The
      Company may, by delivering to the Executive a Notice of Termination, effective
      as of the date listed on the Notice of Termination, terminate Executive’s
      employment at any time for Cause. For purposes of this Agreement, “Cause” shall
      mean the following: (i)
      if the
      Executive should be convicted of or pleads nolo
      contendre
      to any
      felony offense or to a crime that the Company determines, in its sole
      discretion, is crime of moral turpitude (whether or not a felony); (ii)
if
      the
      Executive should commit misconduct or violate any law in connection with the
      performance of any of the Executive’s duties, including, without limitation, (a)
      misappropriation of funds or property of the Company or any of its affiliates
      or
      customers, (b) securing or attempting to secure personally any profit in
      connection with any transaction entered into on behalf of the Company or any
      of
      its affiliates, or (c) making any material misrepresentation to the Company
      or
      any of the Company’s affiliates; (iii) the Executive’s
      violation of or failure to comply with any written Company policy; (iv) the
      Executive’s material breach of any term of this Agreement; (v) the Executive’s
      unacceptable work performance; and (vi) if
      the
      Executive gives any oral or written notice of resignation or provides a Notice
      of Termination based on the Voluntary Termination provision in Section 4.6.
      The
      Company shall not have Cause to terminate the Executive’s employment under
      sub-sections (iii), (iv), or (v) of this Section 4.4 unless and until the
      Company provides written notice to the Executive identifying the Executive’s
      alleged violation of policy, breach of this Agreement, or unacceptable work
      performance and the Executive fails to cure such violation of policy, breach
      of
      this Agreement, or unacceptable work performance within 30 days. If the
      Executive’s employment is terminated for Cause, no further compensation will be
      due the Executive except for the Executive’s unpaid Base Salary owed through the
      employment termination date.


    
      
        
        

      

      
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    4.5   Expiration
      of the Term.
      The
      Executive’s employment under this Agreement shall terminate automatically at the
      expiration of the Term of the Agreement and no further compensation will be
      due
      to the Executive except for any of the Executive’s unpaid compensation under
      this Agreement owed through the employment termination date.

    


    4.6   Voluntary
      Termination.
      The
      Executive may voluntarily terminate his employment at any time during the Term
      by delivering to the Company a Notice of Termination at least 90 days in advance
      of the date of termination (a “Voluntary
      Termination”).
      A
      Voluntary Termination in compliance with this Section 4.6 shall not be
      considered a breach of this Agreement. The Company may shorten the notification
      period under this Section 4.6 by terminating the Executive for Cause. If the
      Executive’s employment is terminated under this Section 4.6, no further
      compensation will be due the Executive except for the Executive’s unpaid Base
      Salary owed through the employment termination date.

    


    4.7   Notice
      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. It must also set forth in
      reasonable detail the facts and circumstances claimed to provide a basis for
      such termination, other than in the event of a Voluntary Termination or
      termination without Cause. 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. If the Executive
      fails
      to include a date of termination in any Notice of Termination he delivers,
      the
      Company may establish such date in its sole discretion.

    


    4.8   Resignations.
      Upon
      ceasing to be an employee of the Company for any reason, 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 the Company or
      any
      of its parents, subsidiaries, or affiliated companies.

    


    V.    SEVERANCE
      BENEFITS

    


    5.1   Severance
      Benefits Applicable Only to Termination Without Cause.
      If at
      any time during the Term the Executive’s employment with the Company is
      terminated pursuant to Section 4.3, the Executive shall be entitled to the
      following only:

    


    (a)    any
      unpaid Base Salary and accrued unpaid vacation then owing through the date
      of
      termination.

    


    (b)    a
      one-time lump sum severance payment in an amount equal to 90 days of the
      Executive’s Base Salary. The lump sum severance payment shall be paid within 60
      days after the date of termination; provided,
      however,
      that
      such payment shall be delayed until the first day of the seventh month following
      the date of termination if the payment would otherwise be expected to trigger
      imposition of the additional tax under Section 409A.1

     

    

      
        

      

    

    1 For
      purposes of this Agreement, “Code”
shall
      mean the Internal Revenue Code of 1986, as amended and “Section
      409A”
shall
      mean Section 409A of the Code and regulations promulgated thereunder (and any
      similar or successor federal or state statute or regulations).


    
      
        
        

      

      
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    5.2   Release.
      The
      Company’s obligation to pay or provide, within 60 days after the date of
      termination, any benefits to the Executive in Section 5.1(b) or Section 5.1(c)
      is expressly subject to the requirements and pre-conditions that: (a) within
      the
      60 day period after the date of termination, the Executive signs a release
      agreement (“Release Agreement”) that the Company will provide and that is in a
      form acceptable to the Company in which Executive releases any possible claims
      against the Company and all of its parents, divisions, subsidiaries, affiliates,
      and related companies, and their present and former agents, employees, officers,
      directors, attorneys, stockholders, plan fiduciaries, successors, and assigns;
      and (b) within the 60 day period after the date of termination, any revocation
      period in the Release Agreement (if any) has expired without Executive’s
      revocation. If either (a) or (b) of this Section 5.2 does not occur within
      the
      60 day period after the date of termination, the Executive will forfeit all
      rights to any payments or benefits provided for under Section 5.1(b) and/or
      Section 5.1(c).

    


    5.3   Other
      Benefits.
      Except
      as expressly provided otherwise in this Article V, the provisions of this
      Agreement shall not affect the Executive’s participation in, or terminating
      distributions and vested rights under, any pension, profit-sharing, insurance
      or
      other employee benefit plan to which the Executive is entitled pursuant to
      the
      terms of such plans, or expense reimbursements he is otherwise entitled to
      under
      Section 3.6. 

    


    5.4   Adjustments
      Due to Excise Tax.
      

    


    (a)    If
      it is
      determined that any amount or benefit to be paid or payable to the Executive
      under this Agreement or otherwise in conjunction with his employment (whether
      paid or payable or distributed or distributable pursuant to the terms of this
      Agreement or otherwise in conjunction with his employment) would give rise
      to
      liability of the Executive for the excise tax imposed by Code Section 4999,
      as
      amended from time to time, or any successor provision (the “Excise
      Tax”),
      then
      the amount or benefits payable to the Executive (the total value of such amounts
      or benefits, the “Payments”)
      shall
      be reduced to the extent necessary so that no portion of the Payments to the
      Executive is subject to the Excise Tax. 

    


    (b)   In
      the
      event it is determined that the Excise Tax may be imposed on the Executive
      prior
      to the possibility of any reductions being made pursuant to Section 5.4(a),
      the
      Company and the Executive agree to take such actions as they may mutually agree
      in writing to take to avoid any such reductions being made or, if such reduction
      is not otherwise required by Section 5.4(a), to reduce the amount of Excise
      Tax
      imposed.


    
      
        
        

      

      
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    VI.    PROTECTIVE
      PROVISIONS

    


    6.1   Restriction
      on Competition.
      This
      Agreement incorporates by reference Section 6.14 of the Merger Agreement.
      Executive agrees to comply with the terms of Section 6.14 of the Merger
      Agreement.

    


    6.2   No
      Solicitation.
      This
      Agreement incorporates by reference Section 6.15 of the Merger Agreement.
      Executive agrees to comply with the terms of Section 6.15 of the Merger
      Agreement.

    


    6.3   Confidential
      Information.
      During
      the period of the Executive’s employment with the Company and at all times
      thereafter, the Executive shall hold in secrecy for the Company all Confidential
      Information2
      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 affiliated company). 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,3
      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 1.2, 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 the
      Company or its affiliates 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.

    


    
      
        

      

    

    2 For
      purposes of this Agreement, “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 or its affiliates (such as non-public information), (ii)
      is
      designated or marked by the Company or any of its affiliates as “confidential”
or reasonably should be considered confidential or proprietary, or (iii) the
      Company or any of its affiliates indicates through its policies, procedures,
      or
      other instructions should not be disclosed to anyone outside of the Company
      or
      any of its affiliates. 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 the Company or any of its affiliates (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.

    


    3
      For
      purposes of this Agreement, “Person” shall
      include individuals or entities such as corporations, partnerships, companies,
      firms, business organizations or enterprises, and governmental or
      quasi-governmental bodies. 

     

    
      
        
        

      

      
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    6.4   Inventions.

    


    (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 of its affiliates, and that relate to the business now or thereafter carried
      on or contemplated by the
      Company or any of its affiliates or
      that
      result from any work performed by the Executive for the Company or any of its
      affiliates.

    


    (b)    The
      Executive acknowledges and agrees that all Inventions shall be the sole and
      exclusive property of the Company (or its appropriate affiliate) and are hereby
      assigned to the Company (or its appropriate affiliate). During the term of
      the
      Executive’s employment with the Company (or any of its affiliates) 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 countries for such Inventions and in order to assign
      and
      convey to the Company (or any of its affiliates) 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
      the
      Company of any of its affiliates 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 the Company or any of its affiliates or to the actual or demonstrably
      anticipated research or development of the Company or any of its affiliates;
      and
      (iv) that does not result from any work performed by the Executive for the
      Company or any of its affiliates.

    


    6.5   Return
      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 the
      Company or any of its affiliates
      (whether
      or not confidential), and (b) all other documents, materials and other
      property belonging to the
      Company or any of its affiliates that
      are
      in the possession or under the control of the Executive. 


    
      
        
        

      

      
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    6.6   Reasonableness;
      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 its affiliates) and that a breach of any of the
      covenants contained in this Article VI would result in material irreparable
      injury to the Company and its affiliates 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 its affiliates shall be entitled to
      the
      remedies of injunction and specific performance, or either of such remedies,
      as
      well as all other remedies to which the
      Company or any of its affiliates
      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. 

    


    6.7   Extension;
      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 suspended, 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 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

    


    7.1   Notices.
      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 U.S. mail or recognized overnight delivery service 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, three business days
      after mailed via U.S. mail 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:

              
	 	 
	 	
                Raymond
                  C. Kolls

              
	 	
                Vice
                  President and General Counsel

              
	 	
                Orthofix
                  International, N.V.

              
	 	
                Huntersville
                  Business Park

              
	 	
                10115
                  Kincey Ave., Suite 250

              
	 	
                Huntersville,
                  NC 28708

              
	 	
                Telephone
                  No.: (704) 948-2620

              
	 	
                Facsimile
                  No.: (704) 948-2691

              
	 	
                E-mail:
                  raykolls@orthofix.com

              
	 	 
	 	
                If
                  to the Executive:

              
	 	 
	 	
                At
                  the Executive’s most recent address on file with the
                  Company

              


      

    

     

    
      
        
        

      

      
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    7.2   Severability.
      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.

    


    7.3   Entire
      Agreement.
      This
      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 and the Executive relating
      to
      the Executive’s employment by the Company, expressly including the Prior
      Agreement, which Prior Agreement is hereby terminated in its entirety and of
      no
      further force and effect. The Executive expressly acknowledges that he has
      no
      further rights, and hereby waives or forfeits any and all rights he may have
      or
      may have had, under the Prior Agreement as a result of its termination hereby,
      and the Company shall not have any obligation to make any payments or satisfy
      any other liability to him thereunder. In the event of any conflict between
      this
      Agreement and any other agreement between the Executive and the Company, this
      Agreement shall control.  

    


    7.4   Amendment; Modification.
      Except
      for changes in Base Salary, and adjustments with respect to Incentive
      Compensation, made as provided in Article II, 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 to the contrary, if
any
      provision of this Agreement contravenes the final regulations or regulations
      anticipated to be promulgated under Section 409A or any other guidance from
      the
      United States Department of Treasury with respect to Section 409A, the Company
      may reform this Agreement or any provision thereof (including,
      without limitation, an amendment instituting
      a six-month waiting period before
      a
      distribution) or
      otherwise incorporate the necessary provisions to maintain to the maximum extent
      practicable the original intent of the provision without violating the
      provisions of Section 409A to the extent that the Company, in its reasonable
      discretion, shall determine. 

    


    7.5   Representations.
      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. The Executive hereby
      acknowledges and represents that he has consulted with legal counsel regarding
      his rights and obligations under this Agreement and that he fully understands
      the terms and conditions contained herein.


    
      
        
        

      

      
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    7.6   Governing
      Law; Jurisdiction.
      This
      Agreement shall be construed, interpreted, and governed in accordance with
      the
      laws of the Commonwealth of Massachusetts without regard to any provision of
      that Commonwealth’s rules on the conflicts of law that might make applicable the
      law of a jurisdiction other than that
      of the
      Commonwealth of Massachusetts.
       Except
      as
      otherwise provided in Section 7.2, all actions or proceedings arising out of
      this Agreement shall exclusively be heard and determined in state or federal
      courts in the Commonwealth of Massachusetts 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. 

    


    7.7   Successors.
      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. Both parties agree that there are no third party
      beneficiaries to this Agreement other than as expressly set forth in this
      Section 7.7.

    


    7.8   Nonassignability.
      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 7.8 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.

    


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

    


    7.10        
      Construction.
      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.

    


    7.11        
      Counterparts.
      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.


    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    


    7.12       
       Effectiveness.
      This
      Agreement shall be effective upon the Effective Date when signed by the
      Executive and the Company.

    


    7.13         Survival.
      Except
      as provided in Section 1.3 with respect to expiration of the Term, Articles
      VI and VII shall survive the termination or expiration of this Agreement for
      any
      reason. 

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    


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

     

    
      	
              BLACKSTONE
                MEDICAL, INC.

            	 	
              EXECUTIVE

            	 
	 	 	 	 	 
	 	 	 	 	 
	
              /s/
                Matthew V. Lyons

            	 	 	 
	 	 	 	
              /s/
                Matthew V. Lyons

            	 
	
              Name:  
                

            	
              Matthew
                V. Lyons

            	 	 	 
	 	 	 	 	 
	
              Title:
                

            	
              President

            	 	 	 


    

     

     

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