Document:

ofix-ex1011_278.htm

Exhibit 10.11

ORTHOFIX MEDICAL INC.

AMENDED AND RESTATED 2012 LONG-TERM INCENTIVE PLAN

 

Performance Stock Unit Agreement

COVER SHEET

 

 

 
 Orthofix Medical Inc., a Delaware corporation (the “Company”), hereby grants performance stock units (the “Performance Stock Units”) relating to shares of the Company’s common stock, par value $0.10 per share (the “Stock”) to the Grantee named below, subject to the achievement of performance goals and vesting conditions set forth below.  Additional terms and conditions of the Performance Stock Units are set forth on this cover sheet and in the attached Performance Stock Unit Agreement (together, the “Agreement”), in the Company’s 2012 Long-Term Incentive Plan (as amended from time to time, the “Plan”), and in the Change in Control and Severance Agreement between you and the Company or, if you have not entered into such Change in Control and Severance Agreement as of the Grant Date, the form of such agreement that was been approved by the Committee on June 28, 2016 (as applicable, the “Severance Agreement”). 
 

			
	
 

Grant Date:
	
 
	
 

	
 

Name of Grantee:
	
 
	
 

	
 

Employee ID Number:
	
 
	
 

	
 

Threshold Number of Performance Stock Units:
	
 
	
50% of Target Number

	
 

Target Number of Performance Stock Units:
	
 
	
 

	
 

Maximum Number of Performance Stock Units:
	
 
	
200% of Target Number

	
 

Performance Period:

 
	
 
	
•Beginning on ____________________ and 

•Ending on _________________________1

 

You agree to all of the terms and conditions described in this Agreement, in the Plan, and in the Severance Agreement unless you deliver a notice in writing within thirty (30) days of receipt of this Agreement to the Company stating that you do not accept the terms and conditions described in this Agreement and in the Plan.  You acknowledge that you have carefully reviewed the Plan and agree that the Plan will control in the event any provision of this Agreement should appear to be inconsistent.

	
	 

	
1 
	
 Performance period end date to be third anniversary of the beginning date (such that total performance period shall be three years).

 

     

 

 

Attachment
This is not a stock certificate or a negotiable instrument.

2

 

 

 

 
 ORTHOFIX MEDICAL INC.
AMENDED AND RESTATED 2012 LONG-TERM INCENTIVE PLAN

 

Performance Stock Unit Agreement

 

		
	
Performance Stock Units
	
This Agreement evidences an award of Performance Stock Units in the number set forth on the cover sheet and subject to the terms and conditions set forth in the Agreement and the Plan.

Subject to satisfaction of the time-based vesting requirement set forth below, the number of shares of Stock, if any, that may be issued pursuant to the terms of this Agreement will be calculated based on the attainment, as determined by the Committee, of the performance goals described in Exhibit A to this Agreement (the “Performance Goals”) over the Performance Period set forth on the cover sheet, which number of shares of Stock may be equal to all or a portion, including none, of the Maximum Number of Performance Stock Units set forth on the cover sheet.  If the Performance Goals are not achieved during the Performance Period at a vesting percentage (as described on Exhibit A) in excess of zero, you will forfeit all of your unvested Performance Stock Units as of the end of the Performance Period, except as otherwise provided in this Agreement.  

	
Performance Stock Unit Transferability 

 
	
Prior to the Settlement Date (as defined below), your Performance Stock Units may not be sold, assigned, transferred, pledged, hypothecated, or otherwise encumbered, whether by operation of law or otherwise, nor may the Performance Stock Units be made subject to execution, attachment, or similar process.  If you attempt to do any of these things, you will immediately and automatically forfeit your Performance Stock Units. 

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Vesting
	
Your Performance Stock Units will vest and become non-forfeitable on (A) the date the Committee certifies the achievement of the Performance Goals following the close of the Performance Period or, (B) in the event of a Change in Control consummated prior to the end of the Performance Period, the last day of the Performance Period (in each case, the “Vesting Date”), and subject to your continued Service from the Grant Date through the Vesting Date, but only to the extent and in the vesting percentage that the Performance Goals have been satisfied.  (By way of illustration, if your service continues through the Vesting Date and the Committee certifies the Performance Goals at a vesting percentage equal to 50%, the Threshold Number of your Performance Stock Units would vest, whereas if your service continues through the Vesting Date and the Committee certifies the Performance Goals at a vesting percentage equal to 200%, the Maximum Number of your Performance Stock Units would vest.)  Promptly following the completion of the Performance Period (and no later than thirty (30) days 

following the end of the Performance Period) or, in the event of a Change in Control consummated prior to the end of the Performance Period, within 30 calendar days of such Change in Control, the Committee will review and certify in writing (i) whether, and to what extent, the Performance Goals for the Performance Period have been achieved and (ii) the number of Performance Stock Units that will vest (based on the applicable vesting percentage determined in accordance with Exhibit A).  Such certification will be final, conclusive, and binding.     

You will forfeit to the Company all of the unvested Performance Stock Units to the extent the specified Performance Goals have not been achieved, as determined by the Committee, effective as of the Vesting Date. 

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Vesting upon Termination of Service Prior to a Change in Control
	
Death or Disability.  If, prior to a Change in Control, your Service terminates during the Performance Period as a result of your death or Disability, your Performance Stock Units will vest as to the Target Number of Performance Stock Units set forth on the cover sheet on the effective date of your termination of Service.  If your Service terminates following the end of the Performance Period but prior to the Vesting Date as a result of your death or Disability, your Performance Stock Units will vest to the extent and in the vesting percentage that the Performance Goals have been satisfied as if your Service had not terminated, effective as of the Vesting Date. 

Certain Terminations without Cause or for Good Reason.  If, prior to a Change in Control, your Service terminates more than 6 months after the Grant Date but prior to the Vesting Date because of your involuntary termination of Service by the Company without Cause or your voluntary termination for Good Reason, you will remain eligible to vest on the Vesting Date (to the extent and in the vesting percentage that the Performance Goals are satisfied) with respect to a pro rata portion of the Performance Stock Units as if your Service had not terminated, which pro rata portion will be calculated by multiplying the total number of the Performance Stock Units that would vest based on actual performance (i.e., the Target Number of Performance Share Units multiplied by the applicable vesting percentage determined in accordance with Exhibit A) by a fraction, the numerator of which equals the number of days that you provided Service during the Performance Period and the denominator of which equals the total number of days in the Performance Period, effective as of the Vesting Date. 

Certain Terminations upon Qualified Retirement.  If, prior to a Change in Control, your Service terminates more than 6 months after the Grant Date but prior to the Vesting Date because of your Qualified Retirement you will remain eligible to vest on the Vesting Date (to the extent and in the vesting percentage that the Performance Goals are satisfied) with 

respect to a pro rata portion of the Performance Stock Units as if your Service had not terminated, which pro rata portion will be calculated by multiplying the total number of the Performance Stock Units that would vest based on actual performance by an additional percentage, which percentage shall be:

•If termination of Service because of Qualified Retirement occurs more than 6 months but no more than 12 months after the Grant Date, then the additional multiplier percentage shall be 33.3%; 

•If termination of Service because of Qualified Retirement occurs more than 12 months but no more than 24 months after the Grant Date, then the additional multiplier percentage shall be 66.7%; and

•If termination of Service because of Qualified Retirement occurs more than 24 months after the Grant Date, then the additional multiplier percentage shall be 100%.

Other Terminations.  If, prior to the Vesting Date, your Service terminates (i) because of your involuntary termination of Service by the Company for Cause, (ii) because of your voluntary termination other than for Good Reason, Qualified Retirement or Disability, or (iii) because of a Qualified Retirement within the first six months following the Grant Date, you will forfeit to the Company all of the unvested portion of the Performance Stock Units on the date of your termination of Service. 

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Change in Control
	
Notwithstanding the vesting schedule set forth above, upon the consummation of a Change in Control during the Performance Period, the Performance Goals will be deemed achieved at the greater of (i) a percentage of 100% (i.e., the Target Number) or (ii) the percentage that would be determined pursuant to the methodology set forth on Exhibit A assuming that the “Ending Period Average Price” on Exhibit A were calculated based on closing prices per share over the twenty consecutive trading days ending with the last trading date preceding the consummation of such Change in Control. If the Performance Stock Units are assumed or continued in connection with such Change in Control, such Performance Stock Units shall thereafter become a time-based award and shall vest and become non-forfeitable, at the percentage determined pursuant to the preceding sentence, on the earlier to occur of (i) your continued status as a Service Provider through the last day of the Performance Period or (ii) your termination of Service during the period following the consummation of such Change in Control and prior to full vesting as a result of (A) death, (B) Disability, (C) your involuntary termination of Service by the Company without Cause, (D) your voluntary termination for Good Reason or (E) your 

Qualified Retirement. If the Performance Stock Units are assumed or continued in connection with the Change in Control and your Service terminates prior to end of the Performance Period (x) because of your involuntary termination of Service by the Company for Cause, (y) because of your voluntary termination other than for Good Reason, Qualified Retirement or Disability, you will forfeit to the Company all of the Performance Stock Units on the date of such termination of Service. 

	
Settlement of Performance Stock Units
	
Your rights to receive the shares of Stock represented by your vested Performance Stock Units will become non-forfeitable on the Vesting Date, and the Performance Stock Units will be settled, converted into shares of Stock and delivered on the date that is one year following the Vesting Date (the “Settlement Date”), subject to any reduction required in accordance with any “clawback” or recoupment policy, as described below). Notwithstanding the foregoing, such delayed settlement will not apply with respect to the vesting and settlement of Performance Stock Units upon (i) the consummation of a Change in Control that is also a “change in control event” within the meaning of Code Section 409A (“Section 409A”), in which case the Performance Stock Units shall settle, convert and be delivered within 30 calendar days of the end of the Performance Period (or if the Performance Stock Units are not assumed or continued in connection with the Change in Control, within 30 calendar days of such Change in Control), or (ii) upon your termination of Service for death or Disability, in which case the Performance Stock Units shall settle, convert and be delivered within 30 calendar days of such termination of Service. On the date on which shares of Stock are delivered to you (or your beneficiary or, if none, your estate in the event of your death) under this paragraph, the Company shall also deliver to you (or your beneficiary or, if none, your estate in the event of your death) the number of additional shares of Stock, the number of any other securities of the Company and the amount of any other property (in the case of cash dividends, assuming such dividends had been reinvested in shares of Stock as of the ex-dividend date thereof), in each case that the Company distributed per share of Stock to holders generally during the period commencing on the first day of the Performance Period  and ending on the delivery date, multiplied by the number of shares of Stock that are being delivered to you under this paragraph, without interest, and less any tax withholding amount applicable to such distribution.  To the extent that the Performance Stock Units are forfeited prior to vesting, the right to receive such distributions shall also be forfeited.

	
Evidence of Issuance
	
The issuance of the shares of Stock with respect to the Performance Stock Units will be evidenced in such a manner as the Company, in its discretion, deems appropriate, including, without limitation, book-entry, registration, or issuance of one or more share certificates. 

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Withholding 
	
In the event that the Company or any Affiliate determines that any federal, state, local, or foreign tax or withholding payment is required relating to the Performance Stock Units, or the issuance of shares of Stock with respect to the Performance Stock Units, the Company or any Affiliate will have the right to (i) require you to tender a cash payment, (ii) deduct from payments of any kind otherwise due to you, (iii) permit or require you to enter into a “same day sale” commitment with a broker-dealer that is a member of the Financial Industry Regulatory Authority (a “FINRA Dealer”) whereby you irrevocably elect to sell a portion of the shares of Stock to be delivered in connection with the Performance Stock Units to satisfy withholding obligations and whereby the FINRA Dealer irrevocably commits to forward the proceeds necessary to satisfy the withholding obligations directly to the Company or any Affiliate, or (iv) withhold the delivery of vested shares of Stock otherwise deliverable under this Agreement to meet such obligations; provided, however, that (x) the shares of Stock so withheld will have an aggregate Fair Market Value not exceeding the minimum amount of tax required to be withheld by Applicable Law and (y) in the event that you are subject to any tax withholding on a date prior to the Settlement Date, clauses (iii) and (iv) shall not be available as a means of satisfying such tax withholding obligations.

	
Retention Rights
	
This Agreement and the Performance Stock Units evidenced by this Agreement do not give you the right to be retained by the Company or any Affiliate in any capacity.  The Company or any Affiliate, as applicable, reserves the right to terminate your Service with the Company or an Affiliate at any time and for any reason.

	
Shareholder Rights
	
You have no rights as a shareholder with respect to the Performance Stock Units unless and until the Stock relating to the Performance Stock Units has been delivered to you.  No adjustments are made for dividends, distributions, or other rights if the applicable record date occurs before your certificate is issued (or an appropriate book entry is made), except as described in the Plan.

	
Clawback
	
The Performance Stock Units are subject to mandatory repayment by you to the Company to the extent you are or in the future become subject to any Company “clawback” or recoupment policy or Applicable Laws that require the repayment by you to the Company of compensation paid by the Company to you in the event that you fail to comply with, or violate, the terms or requirements of such policy or Applicable Laws.

 

	
Applicable Law
	
This Agreement will be interpreted and enforced under the laws of the State of Delaware, other than any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction.

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Definitions
	
For purposes of this Agreement, “Cause,” “Good Reason” and “Qualified Retirement” will be as defined in the Severance Agreement.  Any other capitalized terms used in this Agreement other than the foregoing (and other than those defined and used in Exhibit A hereto) shall have the meanings set forth in the Plan.

	
The Plan 

	
The text of the Plan is incorporated in this Agreement by reference. 

This Agreement, the Plan, and the Severance Agreement constitute the entire understanding between you and the Company regarding the Performance Stock Units.  Any prior agreements, commitments, or negotiations concerning the Performance Stock Units are superseded.

	
Data Privacy
	
To administer the Plan, the Company may process personal data about you.  Such data includes, but is not limited to, information provided in this Agreement and any changes thereto, other appropriate personal and financial data about you, such as your contact information, payroll information, and any other information that might be deemed appropriate by the Company to facilitate the administration of the Plan.  By accepting the Performance Stock Units, you give explicit consent to the Company to process any such personal data.

	
Disclaimer of Rights
	
The grant of Performance Stock Units under this Agreement will in no way be interpreted to require the Company to transfer any amounts to a third party trustee or otherwise hold any amounts in trust or escrow for payment to you.  You will have no rights under this Agreement or the Plan other than those of a general unsecured creditor of the Company.  Performance Stock Units represent unfunded and unsecured obligations of the Company, subject to the terms and conditions of the Plan and this Agreement. 

	
Electronic Delivery
	
By accepting the Performance Stock Units, you consent to receive documents related to the Performance Stock Units by electronic delivery and, if requested, agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company, and your consent shall remain in effect throughout your term of Service and thereafter until you withdraw such consent in writing to the Company.

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Code Section 409A
	
The grant of Performance Stock Units under this Agreement is intended to comply with Section 409A” to the extent subject thereto, and, accordingly, to the maximum extent permitted, this Agreement will be interpreted and administered to be in compliance with Section 409A.  Notwithstanding anything to the contrary in the Plan or this Agreement, neither the Company, its Affiliates, the Board, nor the Committee will have any obligation to take any action to prevent the assessment of any excise tax or penalty on you under Section 409A, and neither the Company, its Affiliates, the Board, nor the Committee will have any 

liability to you for such tax or penalty.

To the extent that the Performance Share Units constitute “deferred compensation” under Section 409A, a termination of Service occurs only upon an event that would be a Separation from Service within the meaning of Section 409A.  If, at the time of your Separation from Service, (1) you are a “specified employee” within the meaning of Section 409A, and (2) the Company makes a good faith determination that an amount payable on account of your Separation from Service constitutes deferred compensation (within the meaning of Section 409A), the payment of which is required to be delayed pursuant to the six (6)-month delay rule set forth in Section 409A to avoid taxes or penalties under Section 409A (the “Delay Period”), then the Company will not pay such amount on the otherwise scheduled payment date but will instead pay it in a lump sum on the first business day after the Delay Period (or upon your death, if earlier), without interest.  Each installment of Performance Share Units that vest under this Agreement (if there is more than one installment) will be considered one of a series of separate payments for purposes of Section 409A.

By accepting this Agreement, you agree to all of the terms and conditions described above and in the Plan.  In the event that any term of this Agreement conflicts with the terms of the Severance Agreement, the terms of the Severance Agreement shall supersede the conflicting terms herein.

 

 

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Exhibit A

Performance Stock Unit Agreement

Performance Goals

The Performance Stock Units will vest based on the percentile rank of the common stock of the Company’s Performance Period TSR in relation to the Performance Period TSR of the Index Companies.  Such percentile ranking will be determined by ordering the Index Companies (plus the Company if the Company is not one of the Index Companies) from highest to lowest based on Performance Period TSR and counting down from the company with the highest Performance Period TSR (ranked first) to the Company’s position on the list.  (If two companies are ranked equally, the ranking of the next company shall account for the tie, so that if one company is ranked first, and two companies are tied for second, the next company is ranked fourth.)  After this ranking, the Performance Period TSR percentile ranking will be calculated using the following formula, rounded to the nearest whole percentile by application of regular rounding:

Performance Period TSR percentile ranking = (N-R)/(N-1)*100

 “N” represents the number of Index Companies for the Performance Period (plus one if the Company is not one of the Index Companies for the Performance Period).

“R” represents the Company’s ranking among the Index Companies (including the Company if the Company is not one of the Index Companies for the Performance Period).

For example, if there are 100 Index Companies (including the Company), and the Company ranked 40th, the Performance Period TSR percentile ranking would be the 61st percentile (61% = (100 – 40)/(100 – 1) * 100, rounded to the nearest whole percentile by application of regular rounding).

Achieved vesting percentages shall be as follows:

Company’s Performance Period 

TSR Percentile RankVesting Percentage

Below 25th Percentile 0%
25th Percentile50% (Threshold)

30th Percentile60%

35th Percentile70%

40th Percentile80%

45th Percentile90%

	
50th Percentile
	
100% (Target)

	
55th Percentile
	
120%

	
60th Percentile
	
140%

	
65th Percentile
	
160%

	
70th Percentile
	
180%

	
75th Percentile or Greater
	
200% (Maximum)

 

     

 

 

In the event the Company’s Performance Period TSR percentile rank falls between any of the amounts set forth above (to the extent greater than the Threshold and lower than the Maximum), the vesting percentage shall be determined by linear interpolation between such amounts.

Notwithstanding the foregoing, (i) in no event shall the vesting percentage exceed 100% if the Company’s Performance Period TSR is negative, and (ii) in no event shall the vesting percentage exceed an amount such that the product of the vesting percentage multiplied by the closing price of the Company’s common stock on [  ]2 is greater than five times the closing price of the Company’s common stock on [  ]3.

For purposes of this Exhibit A, the following capitalized terms shall mean as follows:

“Beginning Period Average Price” means the average official closing price per share of the respective company over the twenty consecutive trading days ending with and including the first day of the Performance Period.

“Ending Period Average Price” means the average official closing price per share of the respective company over the twenty consecutive trading days ending with and including the last day of the Performance Period.

“Index Companies” means companies that are included in the [  ]4 as of the beginning of the Performance Period, with the following adjustments:

	
 
	
i.
	
In the event of a merger, acquisition or business combination transaction of an Index Company with or by another Index Company, the surviving entity shall remain an Index Company.

	
 
	
ii.
	
In the event of a merger of an Index Company with an entity that is not an Index Company, or the acquisition or business combination transaction by or with an Index Company, or with an entity that is not an Index Company, in each case where the Index Company is the surviving entity and remains publicly traded, the surviving entity shall remain an Index Company.

	
 
	
iii.
	
In the event of a merger or acquisition or business combination transaction of an Index Company by or with an entity that is not an Index Company, a “going private” transaction involving an Index Company or the liquidation of an Index Company, where the Index Company is not the surviving entity or is otherwise no longer publicly traded, the company shall no longer be an Index Company.

	
 
	
iv.
	
In the event of a bankruptcy of an Index Company, such company shall remain an Index Company (with such Index Company being deemed to have a Performance Period TSR of negative 100%).

	
	 

	
2 
	
 Insert performance period end date.

	
3 
	
 Insert performance period beginning date.

	
4 
	
 For grants made in 2018 or earlier, insert S&P Healthcare Select Index. For grants made in 2019 or later, insert S&P Healthcare Equipment Select Index.

 

     

 

 

	
 
	
v.
	
In the event of a stock distribution from an Index Company consisting of the shares of a new publicly-traded company (a “spin-off”), the Index Company shall remain an Index Company and the stock distribution shall be treated as a dividend from the Index Company based on the closing price of the shares of the spun-off company on its first day of trading (with the amount of such dividend deemed reinvested in additional shares of the Index Company at the closing price of the shares of the Index Company on the same date).  The performance of the shares of the spun-off company shall not thereafter be tracked for purposes of calculating Performance Period TSR.

“Performance Period TSR” means total shareholder return as determined by dividing (i) the sum of (A) the Ending Period Average Price minus the Beginning Period Average Price plus (B) all dividends and other distributions paid on a company’s shares during the Performance Period by (ii) the Beginning Period Average Price.  In calculating TSR, all dividends are assumed to have been reinvested in shares when paid.  The Committee shall have the authority to make appropriate equitable adjustments to account for extraordinary items affecting a company’s Performance Period TSR.ofix-ex1012_276.htm

Exhibit 10.12

Stock Unit Grant Agreement

under the Orthofix Medical Inc.

Amended and Restated 2012 Long-Term Incentive Plan

 

This Stock Unit Grant Agreement (the “Agreement”) is made this 1st day of April, 2019 (the “Grant Date”) between Orthofix Medical Inc., a Delaware corporation (the “Company”), and the person signing this Agreement adjacent to the caption “Award Recipient” on the signature page hereof (the “Award Recipient”).  Capitalized terms used and not otherwise defined herein shall have the meanings attributed thereto in the Amended and Restated Orthofix Medical Inc. 2012 Long-Term Incentive Plan (the “Plan”).

WHEREAS, pursuant to the Plan, the Company desires to afford the Award Recipient the opportunity to acquire shares of Stock on the terms and conditions set forth herein;

NOW, THEREFORE, in connection with the mutual covenants hereinafter set forth and for other good and valuable consideration, the parties hereto agree as follows:

1.Grant of Stock Units.

(a)Number of Shares/Vesting.  The Company hereby grants to the Award Recipient, on the Grant Date, Stock Units under the Plan relating to 35,587 shares of Stock, subject to the vesting schedule and terms and conditions set forth below (the “Award”).  Subject to earlier termination in accordance with the Plan or this Agreement and the terms and conditions herein, Stock Units granted under this Agreement shall vest with respect to all of the shares of Stock covered hereby on the first anniversary of the Grant Date (the “Vesting Date”) provided that Award Recipient (i) has remained employed by the Company through the Target Retirement Date (as defined in the Transition and Retirement Agreement) or otherwise has had his employment with the Company terminated by the Company without Cause (as defined in the Change in Control and Severance Agreement) prior to the Target Retirement Date and (ii) has complied with the terms of the Consulting Agreement (as defined in the Transition and Retirement Agreement) through the Vesting Date; provided further, however, for the avoidance of doubt, that there shall be no proportionate or partial vesting in the period prior to the Vesting Date.

(b)Additional Documents.  The Award Recipient agrees to execute such additional documents and complete and execute such forms as the Company may require for purposes of this Agreement.

(c)Issuance of Stock.  The shares of Stock underlying the Award Recipient’s vested Stock Units will be issued no later than 30 days following the Vesting Date (the date or dates such shares of Stock are delivered, the “Settlement Date”).  The issuance of shares of Stock under this grant shall be evidenced in such a manner as the Company, in its discretion, will deem appropriate, including, without limitation, book-entry registration or issuance of one or more stock certificates.  On the Settlement Date, the Company shall also deliver to the Award Recipient the number of additional shares of Stock, the number of any other securities of the Company and the amount of any other property (in the case of cash dividends, assuming such dividends had been reinvested in shares of Stock as of the ex-dividend date thereof), in each case that the Company distributed per share of Stock to holders generally during the period commencing on the Grant Date and ending on the applicable Settlement Date, multiplied by the number of shares of Stock that are being delivered to the Award Recipient under this paragraph, without interest, and less any tax withholding amount applicable to such distribution.  To the extent that the Stock Units are forfeited prior to vesting, the right to receive such distributions shall also be forfeited.

(d)Shareholder Rights.  The Award Recipient has no rights as a shareholder with respect to the shares of Stock underlying the Stock Units unless and until the Stock relating to the Stock Units has been delivered.  No adjustments are made for dividends, distributions, or other rights if the applicable record date occurs before the certificate is issued (or appropriate book entry is made), except as described above.  

2.Incorporation of Plan. The Award Recipient acknowledges receipt of the Plan, a copy of which is annexed hereto, and represents that he is familiar with its terms and provisions and hereby accepts this grant of Stock Units subject to all of the terms and provisions of the Plan and all interpretations, amendments, rules and regulations which may, from time to time, be promulgated and adopted pursuant to the Plan. The Plan is incorporated herein by reference. In the event of any conflict or inconsistency between the Plan and this Agreement, 

         

Exhibit 10.12

the Plan shall govern and this Agreement shall be interpreted to minimize or eliminate any such conflict or inconsistency.

3.Restrictions on Transfer.  To the extent not yet vested, the Stock Units may not be sold, transferred, assigned, transferred, pledged, hypothecated, or otherwise encumbered or disposed of, whether by operation of law or otherwise, nor may the Stock Units be made subject to execution, attachment, or similar process.  If the Award Recipient attempts to do any of these things, he will immediately and automatically forfeit the Stock Units.

4.Termination of Service; Change in Control.

(a)Certain Terminations of Service.  If the Award Recipient fails to satisfy the condition set forth in Section 1(a)(i) or the condition set forth in Section 1(a)(ii), in each case other than as a result of the Award Recipient’s death or Disability prior to the Vesting Date, all of the Stock Units shall be forfeited by the Award Recipient and cancelled by the Company as of the date that such satisfaction failure occurs, and the Award Recipient shall have no further right or interest therein unless the Committee in its sole discretion shall determine otherwise.

(b)Termination of Service for Death or Disability. If the Award Recipient fails to satisfy the condition set forth in Section 1(a)(i) and/or the condition set forth in Section 1(a)(ii), in each case solely as a result of the Award Recipient’s death or Disability prior to the Vesting Date, the Stock Units shall automatically vest in full as of the date of the Award Recipient’s termination of Service and shall be delivered within 30 days of such termination of Service.

5.Withholding.

The Company shall have the right to require the Award Recipient to remit to the Company any and all amounts sufficient to satisfy any withholding or other taxes that may be due as a result of the issuance of shares of Stock subject to the Stock Units.  At the time of the Settlement Date (or, in the event that tax withholding is required as of an earlier date, then such earlier date), the Award Recipient shall pay in cash to the Company any amount that the Company may reasonably determine to be necessary to satisfy such withholding or other tax obligation. The Company shall have the right, but not the obligation, to permit or require the Award Recipient to satisfy, in whole or in part, such obligation to remit withholding or other taxes, (a) by directing the Company to withhold shares of Stock that would otherwise become vested, or (b) by entering into a “same day sale” commitment with a broker-dealer that is a member of the Financial Industry Regulatory Authority (a “FINRA Dealer”) whereby Award Recipient irrevocably elects to sell a portion of the shares of Stock to be delivered in connection with the Stock Units to satisfy withholding obligations and whereby the FINRA Dealer irrevocably commits to forward the proceeds necessary to satisfy the withholding obligations directly to the Company or any Affiliate in each case pursuant to such rules as the Committee may establish from time to time.  The Company, in its sole discretion, may also permit, the Award Recipient to satisfy, in whole or in part, such obligation to remit withholding or other taxes, by delivering to the Company shares of Stock already owned by the Award Recipient and not then subject to any repurchase, forfeiture, unfulfilled vesting, or similar requirements.  The Company shall also have the right to deduct from all cash payments made pursuant to, or in connection with, the Stock Units, the federal, state, or local taxes required to be withheld with respect to such payments.  The maximum number of shares of Stock that may be withheld to satisfy any federal, state, or local tax requirements may not exceed such number of shares of Stock having a Fair Market Value equal to the minimum statutory amount required by the Company to be withheld and paid to any such federal, state, or local taxing authority with respect to such vesting or payment; provided, however, for so long as Accounting Standards Update 2016-09 or a similar rule remains in effect, the Committee has full discretion to choose, or to allow the Award Recipient to elect, to withhold a number of shares of Stock having an aggregate Fair Market Value that is greater than the applicable minimum required statutory withholding obligation (but such withholding may in no event be in excess of the maximum required statutory withholding obligation in such Award Recipient’s relevant tax jurisdiction).  

6.No Employment or Other Rights.  This Award does not confer upon the Award Recipient any right to be continued in the employment of, or otherwise provide Services to, the Company or any Subsidiary or other affiliate thereof, or interfere with or limit in any way the right of the Company or any Subsidiary or other affiliate thereof to terminate such Award Recipient’s employment or other service relationship at any time.  For 

         

Exhibit 10.12

purposes of this Agreement only, the term “employment” shall include circumstances under which Award Recipient provides consulting or other Services to the Company or any of its Subsidiaries as an independent contractor, but such Award Recipient is not, nor shall be considered, an employee; provided, however, nothing in this Section 6 or this Agreement shall create an employment relationship between such person and the Company or its applicable Subsidiary, as the usages described in this Section are for convenience only.

7.Adjustment of and Changes in Shares of Stock. In the event of any merger, consolidation, recapitalization, reclassification, stock dividend, extraordinary dividend, or other event or change in corporate structure affecting the shares of Stock, the Committee shall make such adjustments, if any, as it deems appropriate in the number and class of shares subject to the Stock Units. The foregoing adjustments shall be determined by the Committee in its sole discretion.

8.Discretionary Nature of Plan.  The Plan is discretionary in nature, and the Company may suspend, modify, amend or terminate the Plan in its sole discretion at any time, subject to the terms of the Plan and any applicable limitations imposed by law.  This Stock Unit grant under the Plan is a one-time benefit and does not create any contractual or other right to receive additional Stock Units or other benefits in lieu of Stock Units in the future.  Future grants, if any, will be at the sole discretion of the Committee, including, but not limited to, the timing of any grant, the number of Stock Units granted, and the vesting provisions.

9.Section 409A.   The grant of Stock Units under this Agreement is intended to comply with Code Section 409A to the extent subject thereto, and, accordingly, to the maximum extent permitted, this Agreement will be interpreted and administered to be in compliance with Code Section 409A.  Notwithstanding anything to the contrary in the Plan or this Agreement, neither the Company, its Affiliates, the Board, nor the Committee will have any obligation to take any action to prevent the assessment of any excise tax or penalty on Award Recipient under Code Section 409A, and neither the Company, its Affiliates, the Board, nor the Committee will have any liability to Award Recipient for such tax or penalty.  For purposes of this Agreement, a termination of Service occurs only upon an event that would be a Separation from Service within the meaning of Section 409A.  If, at the time of Award Recipient’s Separation from Service, (1) Award Recipient is a “specified employee” within the meaning of Code Section 409A, and (2) the Company makes a good faith determination that an amount payable on account of Award Recipient’s Separation from Service constitutes deferred compensation (within the meaning of Code Section 409A), the payment of which is required to be delayed pursuant to the six (6)-month delay rule set forth in Code Section 409A to avoid taxes or penalties under Code Section 409A (the “Delay Period”), then the Company will not pay such amount on the otherwise scheduled payment date but will instead pay it in a lump sum on the first business day after the Delay Period (or upon Award Recipient’s death, if earlier), without interest.  Each installment of Stock Units that vest under this Agreement (if there is more than one installment) will be considered one of a series of separate payments for purposes of Code Section 409A.   

10.Miscellaneous Provisions.

(a)Applicable Law.  The validity, construction, interpretation and effect of this instrument will be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to the conflicts of law provisions thereof.

(b)Notice.  Any notice required by the terms of this Agreement shall be delivered or made electronically, over the Internet or otherwise (with request for assurance of recipient in a manner typical with respect to communications of that type), or given in writing.  Any notice given in writing shall be deemed effective upon personal delivery or upon deposit with the United States Postal Service, by registered or certified mail, with postage and fees prepaid, and shall be addressed to the Company at its principal executive office and to the Award Recipient at the address that he or she has most recently provided to the Company.  Any notice given electronically shall be deemed effective on the date of transmission.

(c)Headings. The headings of sections and subsections are included solely for convenience of reference and shall not affect the meaning of the provisions of this Agreement.

(d)Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

         

Exhibit 10.12

(e)Amendments. The Board and the Committee shall have the power to alter or amend the terms of the grant of Stock Units as set forth herein from time to time, in any manner consistent with the provisions of the Plan, and any alteration or amendment of the terms of this grant of Stock Units by the Board or the Committee shall, upon adoption, become and be binding on all persons affected thereby without requirement for consent or other action with respect thereto by any such person. The Committee shall give notice to the Award Recipient of any such alteration or amendment as promptly as practicable after the adoption thereof. The foregoing shall not restrict the ability of the Award Recipient and the Board or the Committee by mutual written consent to alter or amend the terms of this grant of Stock Units in any manner which is consistent with the Plan.

(f)Binding Effect. This Agreement shall be binding upon the heirs, executors, administrators and successors of the Award Recipient and the Company.

(g)Entire Agreement.  This Agreement and the Plan constitute the entire agreement between the Award Recipient and the Company regarding the grant of Stock Units and supersede all prior arrangements or understandings (whether oral or written and whether express or implied) with respect thereto.  In the event the Award Recipient has a Severance Agreement, any conflicts or ambiguities shall be resolved first by reference to the Severance Agreement, then to Plan, and finally to this Agreement.  

11.Definitions. For purposes of this Agreement, the following capitalized words shall have the meanings set forth below.

“Change in Control and Severance Agreement” shall mean the Amended Change in Control and Severance Agreement, dated November 1, 2016, between the Award Recipient and the Company.

“Transition and Retirement Agreement” shall mean the Transition and Retirement Agreement, dated February 25, 2019, between the Award Recipient and the Company.

“Separation from Service” shall have the meaning given such term in Code Section 409A.

(Remainder of page intentionally left blank)

         

Exhibit 10.12

EXECUTED on the date first written above.

 

 

 

 

				
	
 
	
 
	
 
	
 

	
COMPANY:
	
 
	
ORTHOFIX MEDICAL INC.

	
 
	
 
	
 

	
 
	
 
	
By:  
	
  /s/ Bradley R. Mason

	
 
	
 
	
Name:  Bradley R. Mason

	
 
	
 
	
Title:    President and Chief Executive Officer

	
 
	
 
	
 

	
AWARD RECIPIENT:
	
 
	
 

	
 
	
 
	
By:  
	
 

	
 
	
 
	
Name: Bradley R. Mason

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