Exhibit 10.1
EMPLOYMENT
AGREEMENT
THIS is an EMPLOYMENT AGREEMENT, made
as of March 26, 2009 (the “ Effective Date
”), between TELEFLEX INCORPORATED (the “ Company
”) and JEFFREY P. BLACK (“Executive”).
Background
A. Executive is employed by the
Company as the Company’s Chairman and Chief Executive
Officer.
B. The purpose of this Agreement
is to set forth the terms and conditions of Executive’s
employment and, in particular, to provide for certain severance
compensation and benefits to be paid or provided to Executive in
the event of the termination of his employment under circumstances
specified herein, to provide for certain commitments by Executive,
and to supersede and replace the Employment Agreement (the “
Prior Agreement ”) dated as of May 5, 2006 and
amended as of January 1, 2009 between the Company and
Executive.
Terms
THE PARTIES, in consideration of the
mutual covenants hereinafter set forth, and intending to be legally
bound hereby, agree as follows:
1.
Definitions . The following terms used in this Agreement
with initial capital letters have the respective meanings specified
therefor in this Section.
“ Affiliate ” of
any Person means (i) any other Person that controls, is
controlled by or is under common control with the first mentioned
Person, or (ii) any Person that, together with the Company,
would be treated as a single employer with the Company under
Section 414(b),(c), (m) or (o) of the Code.
“ Agreement ”
preceded by the word “this” means this Employment
Agreement, as amended at any relevant time.
“ Base Salary ” of
Executive means the highest annualized base rate of salary paid to
Executive within 24 months preceding the Termination Date,
including any and all authorized salary reduction amounts under any
of the Company’s benefit plans or programs; provided,
however, that in the event of a Termination Following a Change of
Control, Base Salary means the highest annualized base rate of
salary being paid to Executive in all capacities with the Company,
including any and all authorized salary reduction amounts under any
of the Company’s benefit plans or programs, at the time of
the Change of Control or any time thereafter.
“ Board ” has the
meaning specified therefor in Section 4(a).
“ Bonus Plan ”
means any Plan providing for the payment of incentive cash
compensation to Executive.
“ Cause ” means
(a) misappropriation of funds, (b) conviction of a crime
involving moral turpitude, or (c) gross negligence in the
performance of duties, which gross negligence has had a material
adverse effect on the business, operations, assets, properties or
financial condition of the Company and its subsidiaries taken as a
whole.
“ Change of Control
” shall mean one of the following shall have taken place
after the date of this Agreement:
(a)
any “person” (as such term is used in Sections 13(d) or
14(d) of the Exchange Act) (other than the Company, any majority
controlled subsidiary of the Company, or the fiduciaries of any
Company benefit plans) becomes the beneficial owner (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, of 20% or more of the total voting power of the voting
securities of the Company then outstanding and entitled to vote
generally in the election of directors of the Company; provided,
however, that no Change of Control shall occur upon the acquisition
of securities directly from the Company;
(b)
individuals who, as of the beginning of any 24 month period,
constitute the Board (as of the date hereof the “
Incumbent Board ”) cease for any reason during such 24
month period to constitute at least a majority of the Board,
provided that any individual becoming a director subsequent to the
date hereof whose election, or nomination for election by the
Company’s shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall
be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office is in connection with
an actual or threatened election contest relating to the election
of the directors of the Company;
(c)
consummation of (i) a merger, consolidation or reorganization
of the Company, in each case, with respect to which all or
substantially all of the individuals and entities who were the
respective beneficial owners of the voting securities of the
Company immediately prior to such merger, consolidation or
reorganization do not, following such merger, consolidation or
reorganization, beneficially own, directly or indirectly, at least
65% of the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors
of the entity or entities resulting from such merger, consolidation
or reorganization, (ii) a complete liquidation or dissolution
of the Company, or (iii) a sale or other disposition of all or
substantially all of the assets of the Company, unless at least 65%
of the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors
of the entity or entities that acquire such assets are beneficially
owned by individuals or entities who or that were beneficial owners
of the voting securities of the Company immediately before such
sale or other disposition; or
(d)
consummation of any other transaction determined by resolution of
the Board to constitute a Change in Control.
“ Code ” means the
Internal Revenue Code of 1986, as amended.
“ Commencement Date
” with respect to the commencement of any compensation or
provision of benefits pursuant to this Agreement means the first
day of the seventh month beginning after the Termination Date.
“ Confidential
Information ” has the meaning specified therefor in
Section 17.
“ Disability ”
means Executive’s continuous illness, injury or incapacity
for a period of six consecutive months.
“ Employment ”
means substantially full time employment of Executive by the
Company or any of its Affiliates.
“ Equity Compensation
Plan ” means a Plan providing for the grant, award or
payment to participants of compensation in the form of
(i) interests in or rights to acquire equity securities of the
Company or derivative securities relating to equity securities of
the Company or (ii) cash payments in amounts equal to the
value or increase in value of equity securities of the Company,
including the 2000 Stock Compensation Plan of the Company or the
2008 Stock Incentive Plan of the Company, as such Plan may be
amended from time to time and any similar Plan or Plans in effect
at any relevant time.
“ Good Reason ”
means the occurrence of one or more of the following actions, to
which Executive objects in writing to the Board within five days
following initial notification of its occurrence or proposed
occurrence, and which action is not then rescinded within
30 days after delivery of such notice:
(a) A
change of the principal office or work place assigned to Executive
to a location more than 25 miles distant from its location
immediately prior to such change.
(b) A
material reduction by the Company of the executive title, duties,
responsibilities, authority, status, reporting relationship or
executive position of Executive; provided that if the Company sells
or otherwise disposes of any part of its business or assets or
otherwise diminishes or changes the character of its business, the
change in the magnitude or character of the Company’s
business resulting therefrom will not itself be deemed to be a
reduction of Executive’s responsibilities, authority or
status within the meaning of this clause (b).
(c) A
reduction of Executive’s base salary (as set forth in Section
5(a) hereof (taking into consideration any upward adjustment)).
“ Insurance Benefits
Period ” means the 36-month period commencing on the
Termination Date.
“ Long Term Incentive
Award ” or “LTI Award” means an award under
the Teleflex Incorporated Executive Incentive Plan to employees of
the Company of compensation in the form of cash and/or equity
securities of the Company, the payment of which awards are
conditioned upon the fulfillment of specified or determinable
performance goals during specified multi-year Performance Periods,
or if such Plan shall be discontinued, a multi-year award under any
similar Plan or Plans in effect at any relevant time.
“ Notice of Termination
” has the meaning specified therefor in Section 10.
“ Performance Period
” applicable to any compensation payable (in cash or other
property) under any Plan, the amount or value of which is
determined by reference to the performance of participants or the
Company or the fulfillment of specified conditions or goals, means
the period of time of such performance is measured or the period of
time in which such conditions or performance goals must be
fulfilled.
“ Person ” means
an individual, a corporation or other entity or a government or
governmental agency or institution.
“ Plan ” means a
plan of the Company for the payment of compensation or provision of
benefits to employees in which plan Executive is or was, at all
times relevant to the provisions of this Agreement, a participant
or eligible to participate.
“ Prorated Amount
” has the meaning specified therefor in
Section 11(e).
“ Release ” has
the meaning specified therefor in Section 16.
“ Severance Compensation
Period ” means the 36 month period commencing on the
day after the Termination Date.
“ Target Award ”
in respect of a bonus payable in cash to Executive pursuant to any
Bonus Plan means the amount specified in or determinable from the
Company’s records pertaining to such Bonus Plan as the
“target award” which would be payable to Executive as
such bonus if specified conditions for a 100% award were fulfilled
but not exceeded, without regard to whether such conditions are
actually fulfilled.
“ Termination Date
” means the date specified in a Notice of Termination
complying with the provisions of Section 10, as such Notice of
Termination may be amended by mutual consent of the parties, which
date shall be the date the Executive’s Termination of
Employment occurs.
“ Termination of
Employment ” means a cessation of Employment which occurs
prior to Executive’s attaining the age of 62 years,
other than such a cessation occurring by reason of
Executive’s death or Disability. Executive’s
Termination of Employment for all purposes under this Agreement
will be determined to have occurred in accordance with the
‘separation from service’ requirements of Code
Section 409A and the Treasury Regulations and other guidance
issued thereunder, and based on whether the facts and circumstances
indicate that the Company and Executive reasonably anticipated that
no further services would be performed after a certain date or that
the level of bona fide services the Executive would perform after
such date (as an employee or as an independent contractor) would
permanently decrease to no more than 20 percent of the average
level of bona fide services performed over the immediately
preceding 36-month period.
“ Termination Following a
Change of Control ” means a Termination of Employment
(regardless of the age of Executive) upon or within two years after
a Change of Control either:
(a)
initiated by the Company for any reason other than Disability or
Cause; or
(b)
initiated by Executive for Good Reason.
“ Year of Termination
” means the Year in which Executive’s Termination Date
occurs.
“ Year ” means a
fiscal year of the Company.
2.
Term . This Agreement shall terminate on the third
anniversary of the Effective Date hereof; provided, however, that
this Agreement shall remain in effect for at least two years after
a Change of Control occurring during the term of this Agreement and
shall remain in effect until all of the obligations of the parties
hereunder are satisfied. The parties agree to consider and
negotiate in good faith towards entering into a successor agreement
upon the termination of such term, provided that neither party
shall have any obligation to enter into any such agreement.
3.
Continued Employment of Executive . The parties acknowledge
that Executive’s employment by the Company is at will and,
except as the parties may hereafter agree in writing, such
employment may be terminated by either party at any time, subject
only to the giving of prior notice pursuant to Section 10.
Nothing in this Agreement shall be construed as giving Executive
any right to continue in the employ of the Company.
4.
Employment .
(a)
Duties . Executive shall serve as the President and Chief
Executive Officer of the Company with the duties, responsibilities
and authority commensurate therewith and shall report to the Board
of Directors of the Company (the “ Board ”).
Executive shall use his best efforts to perform all duties and
accept all responsibilities incident to such position as may be
reasonably assigned to him by the Board and consistent with his
position as the President and Chief Executive Officer.
(b)
Best Efforts . During the term of this Agreement, Executive
shall devote his best efforts and full business time and attention
to promote the business and affairs of the Company and its
Affiliates, and shall be engaged in other business activities only
to the extent that such activities do not materially interfere or
conflict with his obligations to the Company hereunder. The
foregoing also shall not be construed as preventing Executive from
(1) serving on civic, educational, philanthropic or charitable
boards or committees, or, with the prior written consent of the
Board, in its sole discretion, on other corporate boards,
(2) delivering lectures, fulfilling speaking engagements or
lecturing at educational institutions, and (3) managing
personal investments, so long as such activities do not
significantly interfere with the performance of the
Executive’s responsibilities hereunder.
5.
Base Salary and Incentive Compensation .
(a) As compensation for
the services to be rendered hereunder, the Company shall pay to
Executive a base salary at the annual rate of $900,000. This amount
may be subject to an upward adjustment at the beginning of each
Year, as determined by the Board, in its sole discretion.
Executive’s base salary shall be paid in accordance with the
Company’s existing payroll policies, and shall be subject to
all applicable withholding taxes.
(b) Executive shall be
eligible to participate in annual and long-term incentive
compensation programs provided by the Company for its senior
executives, as determined and on the terms established from time to
time by the Compensation Committee (the “ Committee
”) of the Board, in its sole discretion.
6.
Equity Compensation . Executive shall be eligible to
participate in equity compensation programs provided by the Company
for its senior executives, as determined and on the terms
established from time to time by the Committee, in its sole
discretion.
7.
Retirement and Welfare Benefits; Perquisites . Executive
shall be entitled to participate in the Company’s retirement
and welfare employee benefit plans and programs, if any, pursuant
to their respective terms and conditions. Nothing in this Agreement
shall preclude the Company from terminating or amending any
employee benefit plan or program from time to time. In addition,
the Company will reimburse Executive for premiums for
$1 million of life insurance coverage under an individual
policy owned by Executive. Finally, Executive shall be entitled
annually to personal use of the Company aircraft for the lesser of
(i) 50 hours of flight time or (ii) $100,000 in incremental,
variable costs to the Company (as calculated in accordance with the
disclosure rules of the Securities and Exchange Commission). The
reimbursements and in-kind benefits set forth in the prior two
sentences shall be provided for expenses and services incurred
during the term of this Agreement, and the amount of expenses
eligible for reimbursement, or in-kind benefits provided, during
one calendar year may not affect the expenses eligible for
reimbursement, or in-kind benefits to be provided, in any other
calendar year. All reimbursements under this provision shall be
made no later than the last day of the calendar year following the
calendar year in which the expense was incurred, and all requests
for reimbursement must be made by the Executive no later than
15 days before that date in order to be eligible for
reimbursement hereunder. The Executive’s right to have the
Company pay such expenses or provide such in-kind benefits may not
be liquidated or exchanged for any other benefit.
8.
Vacation . Executive shall be entitled to vacation, and
holiday and sick leave at levels commensurate with those provided
to other senior executive officers of the Company, in accordance
with the Company’s vacation, holiday and other similar
polices as in effect from time to time for senior executives.
9.
Expenses . The Company shall reimburse Executive for all
necessary and reasonable travel and other business expenses
incurred by Executive in the performance of his duties hereunder in
accordance with such reasonable accounting procedures as the
Company may adopt generally from time to time for executives. All
reimbursements under this provision shall be for expenses incurred
during the term of this Agreement and shall be made no later than
the last day of the calendar year following the calendar year in
which the expense was incurred; all requests for reimbursement must
be made by the Executive no later than 15 days before that
date in order to be eligible for reimbursement hereunder. The
amount of such expenses that the Company is obligated to pay in any
given calendar year shall not affect the expenses that the Company
is obligated to pay in any other calendar year, and the
Executive’s right to have the Company pay such expenses may
not be liquidated or exchanged for any other benefit.
10.
Notice of Termination of Employment . The party initiating
any Termination of Employment shall give notice thereof to the
other party (a “ Notice of Termination ”). A
Notice of Termination shall (i) state with reasonable
particularity the reasons for such Termination of Employment, if
any, which are relevant to Executive’s right to receive
compensation and benefits pursuant to this Agreement and
(ii) specify the date such Termination of Employment shall
become effective which, without the consent of such other party,
shall not be later than 15 days after the date of such Notice
of Termination, except in the event of a Termination of Employment
initiated by the Company with Cause (in which case no advance
notice shall be required).
11.
Compensation upon Termination of Employment . Subject to the
terms of Sections 16-19, upon Termination of Employment
(i) by the Company other than for Cause or (ii) by
Executive within two months after the expiration of the period for
rescission of an action that, absent such rescission, would
constitute Good Reason, Executive will receive from the Company the
following payments and benefits:
(a)
Unpaid Salary . Within 15 days after the Termination
Date, Executive shall receive a lump sum cash payment equal to
Executive’s unpaid base salary, if any, earned through the
Termination Date.
(b)
Cash Bonuses for Years Preceding the Year of Termination .
If any cash award pursuant to a Bonus Plan in respect of a
Performance Period which ended before the Year of Termination shall
not have been paid to Executive on or before the Termination Date,
the Company will pay Executive, within 15 days after the
Termination Date, such award in the amount of Executive’s
award earned for the Performance Period; provided, however, that if
any such Bonus Plan requires, as a condition to eligibility for
payment, that a participant be employed by the Company on the date
payment is made, then payment of the award under such Bonus Plan
for the Performance Period ended before the Year of Termination
shall be made on the Commencement Date.
(c)
Continuation of Base Salary . As consideration for the
obligations of Executive under Sections 17 and 18, the Company
will pay Executive (i) on the Commencement Date an amount
equal to seven-twelfths of Executive’s Base Salary, and
(ii) each month thereafter during the Severance Compensation
Period an amount equal to one-twelfth of Executive’s Base
Salary.
(d)
Additional Severance . As consideration for the obligations
of Executive under Sections 17 and 18, on March 15 of
each of the first three Years immediately following the Termination
Date the Company will pay Executive an amount equal to 100% of
Executive’s Base Salary; provided that if the foregoing date
for the first such annual payment occurs before the Commencement
Date, such first annual payment will be paid on the Commencement
Date.
(e)
Payment of Cash-Based LTI Awards for Performance Periods Not
Completed Before the Termination Date . On the later of the
Commencement Date or the date that is 2 1/2 months following the
end of the relevant Performance Period, the Company will pay
Executive the Prorated Amount of the cash portion of
Executive’s LTI Award for the Performance Period, if any,
which is scheduled to end on the last day of the Year of
Termination. The amount of any such cash-based award, from which
the Prorated Amount is derived, shall be determined based on the
degree to which each performance goal on which such award is based
has been satisfied prior to the Termination Date, as determin
