EXHIBIT 10.21
EMPLOYMENT AGREEMENT
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This EMPLOYMENT AGREEMENT (this "Agreement") is made as of March 21, 2000
(the "Effective Date"), between STERIS Corporation, an Ohio Corporation
("STERIS"), and Xxx X. Xxxxxx ("Executive").
In consideration of the mutual covenants contained in this Agreement and
other good and valuable consideration, the receipt and sufficiency of which are
in this Agreement acknowledged, the parties to this Agreement agree as follows:
A. President and Chief Operating Officer
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1. Position and Duties.
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(a) Effective March 18, 2000, Executive shall serve as the Chief
Operating Officer of STERIS and shall have the normal duties, responsibilities
and authority of an executive serving in such position, subject to the power of
the STERIS Board of Directors (the "Board") to expand or limit such duties,
responsibilities and authority, either generally or in specific instances.
Executive shall have the title President of STERIS, subject to the power of the
Board to change such title from time to time. On or prior to the date of this
Agreement, Executive shall have been elected by the Board to fill the current
vacancy on Class I of the Board pursuant to Article II, Section 2 of the Amended
and Restated Regulations of STERIS.
(b) Executive shall devote his best efforts and his full business time
and attention (except for permitted vacation periods, reasonable periods of
illness or other incapacity, and provided such activities do not have more than
a de minimis effect on Executive's performance of his duties under this
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Agreement, participation in charitable and civic endeavors and management of
Executive's personal investments and business interests) to the business and
affairs of STERIS. Executive shall perform his duties and responsibilities to
the best of his abilities in a diligent, trustworthy, businesslike and efficient
manner.
(c) Executive shall perform his duties and responsibilities
principally in the Cleveland metropolitan area, and shall not be required to
travel outside that area any more extensively than required in the ordinary
course of the business of STERIS.
2. Compensation and Benefits.
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(a) Base Salary. Effective April 1, 2000, STERIS agrees to pay
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Executive a base salary of $400,000.00 per annum. Executive's base salary may be
increased by the Board from time to time. Until April 1, 2000, Executive shall
be paid
the base salary outlined in his July 13, 1999 letter agreement with STERIS.
Executive shall also receive the $75,000 bonus for the quarter ending March 31,
2000.
(b) Annual Bonus. Effective April 1, 2000, Executive will be a
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participant in the STERIS Management Incentive Compensation Plan ("MICP").
Executive shall have the opportunity for the achievement of the full year bonus
target level of $320,000 based upon the overall corporate target established by
the Board for fiscal year 2001. Executive's entitlement to bonus compensation
for fiscal years after 2001 shall be pursuant to the MICP and may be increased
by the Board from time to time.
(c) Stock Options. Executive will be eligible for a non-qualified
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stock option grant of not less than 250,000 common shares at the next such date
that other STERIS executives are granted options. Executive shall be eligible
for other option grants consistent with company practices. The option will be
evidenced by an agreement (The Stock Option Agreement) in the standard form of
option agreement used by STERIS.
(d) Expense Reimbursement. STERIS shall reimburse Executive for all
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reasonable expenses incurred by him in the course of performing his duties under
this Agreement which are consistent with STERIS' policies in effect from time to
time with respect to travel, entertainment and other business expenses, subject
to STERIS' requirements with respect to reporting and documentation of such
expenses.
(e) Standard Executive Benefits Package. In addition to the base
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salary and any bonus payable to Executive pursuant to this Agreement, Executive
shall continue to be entitled to participate in and receive on the same basis
any and all benefits made available to other executives of STERIS. STERIS will
continue to work with its insurance benefits provider to coordinate Executive's
medical and dental coverage under Executive's current program with Executive's
former employer and shall reimburse Executive for his cost of membership at The
Union Club (or similar club) and a country club of his choice.
(f) Indemnification. With respect to Executive's acts or failures to
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act during the Employment Period in his capacity as a director, officer,
employee or agent of STERIS, Executive shall be entitled to indemnification from
STERIS, and to liability insurance coverage, on the same basis as other
directors and officers of STERIS.
3. Change in Control Agreement. The Parties to this Agreement have
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entered into a Change in Control Agreement effective March 21, 2000.
B. President and Chief Executive Officer
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1. Effective Date. It is anticipated that Executive will be appointed to
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serve as Chief Executive Officer of STERIS on or before the date of the year
2000 annual meeting of the shareholders of STERIS currently scheduled for July
21, 2000. On such
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appointment, Executive shall have the normal duties, responsibilities and
authority, of an executive serving in such position, subject to the power of the
Board to expand or limit such duties, responsibilities and authority, either
generally or in specific instances. Executive shall continue to act as President
of STERIS and shall maintain his position on the Board. From the effective date,
Executive's compensation will be as noted below.
2. Base Salary. Upon his appointment as Chief Executive Officer, STERIS
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agrees to pay Executive a base salary of $575,000 per annum. Executive's base
salary may be increased by the Board from time to time.
3. Bonus. Upon Executive's appointment as Chief Executive Officer,
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Executive shall be a participant in the Senior Executive Management Incentive
Compensation Plan and shall have the opportunity for the achievement of the full
year bonus target level of $575,000, based upon overall corporate achievement
for fiscal year 2001. Executive's entitlement to bonus compensation for fiscal
years after 2001 shall be pursuant to the Senior Executive Management Incentive
Compensation Plan and may be increased by the Board from time to time.
4. Proration of Fiscal Year 2001 Bonus. For fiscal year 2001, the amount
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of any bonus opportunity for Executive shall be prorated based upon a target
level of $320,000 for the number of days Executive serves as Chief Operating
Officer and on a target level of $575,000 for the number of days Executive
serves as Chief Executive Officer prior to April 1, 2001, both periods prorated
based on a 365 day year.
5. Stock Options. STERIS will grant Executive non-qualified stock options
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to purchase additional shares of STERIS' common stock in accordance with the
customary business practices.
6. Benefits and Expenses Reimbursement. Upon Executive's appointment as
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Chief Executive Officer, he shall continue to receive the benefits and expense
reimbursements he received as Chief Operating Officer.
7. Change of Control. The Change of Control Agreement signed by the
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parties on March 21, 2000, shall remain in effect upon Executive's appointment
as Chief Executive Officer.
8. Failure to Appoint by the Date of the Year 2000 Annual Meeting of
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Shareholders. If Executive has not been appointed Chief Executive Officer on or
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prior to the date of the year 2000 annual meeting of Shareholders, Executive
shall receive a lump sum payment of (i) two years of his annual base salary as
Chief Operating Officer plus (ii) the Chief Operating Officer target bonus
amount of $320,000 Additionally, Executive shall receive:
(a) For the 12 months following the date of the year 2000 annual
meeting of Shareholders, all benefits the Executive received as
Chief Operating Officer;
(b) The value of any accrued, but unused vacation.
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9. Miscellaneous. If the Executive is appointed Chief Executive Officer,
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the parties will mutually agree to the terms of Executive's separation as STERIS
Corporation's Chief Executive Officer at a future date.
C. Notices
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Any notice provided for in this Agreement shall be in writing and shall be
either personally delivered, or by recognized delivery service, to the recipient
at the address below indicated:
Notices to Executive:
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Xxx X. Xxxxxx
00 Xxxx Xxxxxxx Xxxx
Xxxxxxxx Xxxxx, Xxxx 00000
Notices to STERIS:
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STERIS Corporation
0000 Xxxxxxx Xxxx
Xxxxxx, Xxxx 00000
Attn: General Counsel
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when delivered.
D. Severability
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Whenever possible, each provision of this Agreement shall be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, this Agreement
shall be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained in this
Agreement.
E. Complete Agreement
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This Agreement, the Change of Control Agreement described in Paragraphs A.4
and B.7 and any Stock Option Agreement and the attached Non-Disclosure and
Non-Competition Agreement executed or to be executed in accordance with the
terms of this Agreement, embody the complete Agreement and understanding between
the parties with respect to the subject matter of this Agreement and effective
as of its date supersedes and preempts any prior understanding, agreements or
representations by or between the parties, written or oral, which may have
related to the subject matter of this agreement in any way.
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F. Counterparts
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This Agreement may be executed in separate counterparts, each of which
shall be deemed to be an original and both of which taken together shall
constitute one and the same agreement.
G. Successors and Assigns
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This Agreement shall bind and inure to the benefit of and be enforceable by
Executive, STERIS and their respective heirs, executors, personal
representatives, successors and assigns, except that neither party may assign
any of his or its rights or delegate any of his or its obligations hereunder
without the prior written consent of the other party. Executive hereby consents
to the assignment by STERIS of all of its rights and obligations hereunder to
any successor to STERIS by merger or consolidation or purchase of all or
substantially all of STERIS' assets; in each case provided such transferee or
successor assumes the liabilities of STERIS hereunder.
H. Choice of Law
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This Agreement shall be governed by the internal law, and not the law of
conflicts, of the State of Ohio.
I. Amendment and Waiver
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The provisions of this Agreement may be amended or waived only with the
prior written consent of STERIS and Executive, and no course of conduct or
failure or delay in enforcing the provisions of this Agreement shall affect the
validity, binding effect or enforceability of this Agreement.
IN WITNESS WHEREOF, the parties to this Agreement have executed this
Agreement as of the date first written above.
STERIS Corporation
By: /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
Its: Senior Vice President and General
Counsel
/s/ Xxx X. Xxxxxx
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XXX X. XXXXXX
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