Form 8-K STRYKER CORP For: Jul 10
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 6, 2018
STRYKER CORPORATION
(Exact name of registrant as specified in its charter)
Michigan | 000-09165 | 38-1239739 | ||
(State of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||
2825 Airview Boulevard Kalamazoo, Michigan | 49002 | |||
(Address of principal executive offices) | (Zip Code) | |||
(269) 385-2600 | ||||
(Registrant’s telephone number, including area code) | ||||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging Growth Company [ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
ITEM 5.02 | DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS |
Stryker Corporation (the “Company”) announced on July 10, 2018 that David K. Floyd has notified the Company of his intent to retire from his role as Group President, Orthopaedics effective August 1, 2018, and that Timothy J. Scannell, who currently serves as Group President, MedSurg and Neurotechnology, will be appointed President and Chief Operating Officer effective August 1, 2018.
Mr. Floyd has entered into a letter agreement with the Company pursuant to which he will continue to be employed as Group President and Advisor to the Company’s Chief Executive Officer from August 1, 2018 through June 30, 2019 to ensure a smooth transition. Under the terms of the letter agreement, Mr. Floyd will continue to receive a base salary at his current annual rate and will be eligible for an incentive bonus opportunity.
Mr. Scannell, 53, began his career with Stryker’s Endoscopy business in 1990 where he served in sales and marketing leadership roles. He then took on roles of increased responsibility spanning many of our businesses and has served as a Group President for nearly a decade, most recently overseeing MedSurg & Neurotechnology. Mr. Scannell serves on the Board of Directors for Insulet Corporation.
Mr. Scannell will receive a base salary at the annual rate of $750,000. Mr. Scannell’s bonus potential will be 100% of his annual salary. His actual bonus will be prorated based on the portion of the year that he serves as President and Chief Operating Officer. In connection with his appointment, Mr. Scannell will receive an award of restricted stock units pursuant to the Company’s 2011 Long-Term Incentive Plan having a grant date fair value of approximately $1,900,000, which will vest based on Mr. Scannell’s continued employment in 1/3 installments on each of August 1, 2019, August 1, 2020 and August 1, 2021. In addition, the Company’s Chairman and Chief Executive Officer will recommend that the Compensation Committee of the Company’s Board of Directors approve the award to Mr. Scannell of stock options and performance stock units having a grant date fair value of approximately $5,000,000, comprised of 50% in stock options and 50% in performance stock units, on the regular annual equity award grant date in February 2019, in accordance with the structure and terms of the annual awards granted to other senior executives at that time.
The summary description of the letter agreement with Mr. Floyd contained in this Form 8-K is not complete and is qualified in its entirety by, and should be read in conjunction with, the complete text of such agreement filed as Exhibit 10.1 to this Form 8-K and incorporated herein by reference.
ITEM 9.01 | FINANCIAL STATEMENTS AND EXHIBITS |
(d) | Exhibits | |
Letter Agreement between Stryker Corporation and David K. Floyd | ||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
STRYKER CORPORATION | ||
(Registrant) | ||
July 10, 2018 | /s/ WILLIAM E. BERRY, JR. | |
Date | William E. Berry, Jr. | |
Vice President, Corporate Controller | ||
Exhibit 10.1
Katy Fink
Vice President, Chief Human Resources Officer
2825 Airview Boulevard
Kalamazoo, MI 49002 USA
P 269 389 7721
www.stryker.com
July 6, 2018
Dear David:
In connection with your decision to retire from Stryker in 2019, and to develop a plan for transitioning your roles and responsibilities prior to your retirement, it is with pleasure that I hereby confirm our offer for you to serve as Group President and Advisor to CEO, reporting to Kevin Lobo until your retirement from Stryker on June 30, 2019.
Your effective date in the role of Group President and Advisor to CEO will begin as of August 1, 2018. In this role, you will transition your responsibilities as the Group President, Orthopaedics to the new leadership team responsible for the businesses and teams you currently lead, provide support to new leadership with strategic decisions, and provide other leadership and support as requested by Stryker for other matters prior to your retirement. Your retirement date will be June 30, 2019 (“Retirement Date”). The terms of your compensation and benefits will remain the same as is currently in effect through the Retirement Date:
• | Your salary will remain at the annualized amount of $640,000. |
• | You will continue to be eligible for the 2018 incentive bonus with a target bonus percentage of 85% ($544,000). Terms of the bonus and your objectives will remain consistent with the 2018 Bonus Plan dated February 7, 2018. |
• | Your participation in Stryker’s 401(k) plan, Supplemental Executive Retirement Plan, and stock awards including stock options, RSUs and PSUs will continue to be governed by the terms of those plans. Included in these terms is the ongoing vesting of granted stock awards through the retirement date of June 30, 2019. |
In exchange for your assistance in the transition of your roles and responsibility and agreeing to serve as Group President and Advisor to CEO through the Retirement Date, Stryker will pay you an incentive bonus in the amount of $272,000. To receive the bonus, you must remain employed by Stryker, in good standing, through the Retirement Date and continue to support the transition as outlined above. Stryker will pay the incentive bonus within fifteen (15) calendar days after your retirement. Unless agreed to otherwise between you and Stryker or the terms of the relevant plans, all salary and benefits will end as of the Retirement Date.
Other provisions of your employment relationship with Stryker will continue in effect, meaning that you agree to abide by the requirements and guidelines set forth in Stryker’s Code of Conduct and other policies, Stryker’s Employee Handbook and the terms of Stryker’s Confidentiality, Intellectual Property, Non-Competition and Non-
Solicitation Agreement that you signed. You also acknowledge that you are aware of Stryker’s at-will employment relationship with you.
To accept this offer, please sign this letter on the space provided below and return it to me. If you have any questions, please feel free to contact me.
Sincerely,
/s/ KATY FINK | ||
Katy Fink | ||
Vice President, Chief Human Resources Officer | ||
I accept this offer of employment with Stryker and agree to the terms and conditions outlined in this letter:
/s/ DAVID FLOYD | 7/7/2018 | |
David Floyd | Date | |
c: Employee file, Kevin Lobo