Document:

STERIS Corporation 2002 Stock Option Plan.

 EXHIBIT 10.7 
  
 STERIS CORPORATION 
  
 2002 STOCK OPTION PLAN 
  
 1.  Purpose.    The STERIS Corporation 2002 Stock Option Plan is intended to promote the interests of STERIS Corporation and its shareholders by enabling the Company and its Subsidiaries to attract and
retain key Employees and by stimulating the interest of key Employees in the development and financial success of the Company. To achieve these purposes, the Company may grant Incentive Stock Options and Nonqualified Stock Options to key Employees
selected by the Compensation Committee, all in accordance with the terms and conditions set forth in the Plan. Capitalized terms used in the Plan have the meanings ascribed to them in Section 21, the last section hereof. 
  
 2.  Shares Subject to the Plan.    The number of
Common Shares that may be issued pursuant to the Plan shall be subject to the overall aggregate limit set forth in Section 2.1 and the specific further limits set forth in Section 2.2, in each case subject to adjustment under Section 9. Common
Shares issued pursuant to the Plan may be authorized and unissued Common Shares, treasury Common Shares, or Common Shares acquired on the open market specifically for distribution under the Plan, as the Board of Directors may from time to time
determine. If any Option for any reason expires or is terminated, in whole or in part, without the receipt by an Employee of Common Shares the Common Shares subject to that part of the Option that has so expired or terminated shall again be
available for the future grant of Options under the Plan. 
  
 2.1  Overall Aggregate Limit.    The aggregate number of Common Shares that may be issued pursuant to Options granted under the Plan shall be 4,000,000 Common Shares. 
  
 2.2  Specific Further Limits.    In addition to
the overall aggregate limit set forth in Section 2.1, the following specific limits shall apply to Options granted pursuant to the Plan: 
  
 (a)  Incentive Stock Option Limit.    The maximum number of Common Shares that may be issued under the Plan
pursuant to Incentive Stock Options shall be 4,000,000 Common Shares. 
  
 (b)  Per Employee Limit.    The maximum number of Common Shares that may be subject to Options granted under the Plan to any Employee during any calendar year shall be 500,000 Common Shares.

  
 3.  Eligibility.    Options may be
granted to officers and to other key Employees selected by the Committee in its sole discretion. The granting of any Option to an Employee shall not entitle that Employee to, nor disqualify that Employee from, participation in any other grant of an
Option. 
  
 4.  Administration.    The
Plan shall be administered by the Committee. No Option may be granted under the Plan to any member or alternate member of the Committee. The Committee shall have authority, subject to the terms of the Plan, (a) to determine the Employees who are
eligible to participate in the Plan, the type, size, and terms of Options to be granted to any Employee, the time or times at which Options shall be exercisable or at which any restrictions, conditions, and contingencies that the Committee may
impose in connection with the grant of any Option shall lapse, and the terms and provisions of the instruments by which Options shall be evidenced, (b) to interpret the Plan, and (c) to make all determinations necessary for the administration of the
Plan. The construction and interpretation by the Committee of any provision of the Plan or any Option Agreement delivered pursuant to the Plan and any determination by the Committee pursuant to any provision of the Plan or any Option Agreement shall
be final and conclusive. No member or alternate member of the Committee shall be liable for any such action or determination made in good faith. The Committee may act only by a majority of its 

 
members. Any determination of the Committee may be made, without a meeting, by a writing or writings signed by all of the members of the Committee. In addition, the
Committee may authorize any one or more members of the Committee or any officer of the Company to execute and deliver documents on behalf of the Committee and the Committee may delegate to one or more employees, agents, or officers of the Company,
or to one or more third party consultants, accountants, lawyers, or other advisors, such ministerial duties related to the operation of the Plan as it may deem appropriate. 
  
 5.  Stock Options. 
  
 5.1  Type and Date of Grant of Options. 
  
 (a)  The Option Agreement pursuant to which any Incentive Stock Option is granted shall specify that the Option granted thereby shall be
treated as an Incentive Stock Option. The Option Agreement pursuant to which any Nonqualified Option is granted shall specify that the Option granted thereby shall not be treated as an Incentive Stock Option. 
  
 (b)  The day on which the Committee authorizes the grant of
an Incentive Stock Option shall be the date on which that Option is granted. No Incentive Stock Option may be granted on any date after the tenth anniversary of the date of adoption of the Plan. 
  
 (c)  The day on which the Committee authorizes the grant of
a Nonqualified Option shall be considered the date on which that Option is granted, unless the Committee specifies a later date. 
  
 5.2  Exercise Price.    The Exercise Price under any Option shall be not less than the Fair Market Value of the Common Shares
subject to the Option on the date the Option is granted. 
  
 5.3  Option Expiration Date.    The Option Expiration Date under any Incentive Stock Option shall not be later than ten years from the date on which the Option is granted. The Option Expiration Date
under any Nonqualified Option shall not be later than ten years and one month from the date on which the Option is granted. 
  
 5.4  Vesting Schedule.    Unless otherwise provided in the relevant Option Agreement, each Option shall first become
exercisable to the extent of: 
  
 (a)  from and
after the first anniversary of the date of grant, 25% of the Common Shares subject to the Option; 
  
 (b)  from and after the second anniversary of the date of grant, an additional 25% of the Common Shares subject to the Option; 

 
 (c)  from and after the third anniversary of the date of
grant, an additional 25% of the Common Shares subject to the Option; and 
  
 (d)  from and after the fourth anniversary of the date of grant, the remaining 25% of the Common Shares subject to the Option. 
  

Unless otherwise provided in the relevant Option Agreement, if, by reason of the application of Section 6, an Option may be exercised at a time when an Employee is no longer in
the service of the Company, and, on the Employment Termination Date, the Employee held any Options that were not then otherwise fully exercisable, each such Option shall be exercisable as of the Employment Termination Date (i) to the extent that it
was exercisable pursuant to the foregoing schedule plus (ii) to the extent of an additional 
  

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percentage determined by multiplying 25% by a fraction the numerator of which is the number of days between the Employment Termination Date and the immediately
preceding anniversary of the date of grant (or, if the Employment Termination Date comes before the first anniversary of the date of grant, the numerator will be the number of days between the Employment Termination Date and the date of grant) and
the denominator of which is 365. 
  
 5.5  Exercise of
Options. 
  
 (a)  Except as otherwise
provided in Section 6, an Option may be exercised only while the Employee to whom the Option was granted is in the employ of the Company or of a Subsidiary. Once any portion of an Option becomes exercisable, whether by lapse of time or upon
satisfaction of any other restriction, condition, or contingency that may have been established by the Committee and contained in the Option Agreement, that portion shall remain exercisable until expiration or termination of the Option. An Employee
to whom an Option is granted may exercise the Option from time to time, in whole or in part, up to the total number of Common Shares with respect to which the Option is then exercisable, except that no fraction of a Common Share may be purchased
upon the exercise of any Option. 
  
 (b)  An
Employee electing to exercise an Option shall deliver to the Company (i) the Exercise Price payable in accordance with Section 5.6 and (ii) written notice of the election that states the number of whole Common Shares with respect to which the
Employee is exercising the Option. 
  
 5.6  Payment For Common
Shares.    Upon exercise of an Option by an Employee, the Exercise Price shall be payable by the Employee in cash or in such other form of consideration as the Committee determines may be accepted, including, without
limitation, securities or other property, or any combination of cash, securities, or other property, or by delivery by the Employee (with the written notice of election to exercise) of irrevocable instructions to a broker registered under the 1934
Act to promptly deliver to the Company the amount of sale or loan proceeds to pay the Exercise Price. The Committee, in its sole discretion, may grant to an Employee the right to transfer Common Shares acquired upon the exercise of a part of an
Option in payment of the Exercise Price payable upon immediate exercise of a further part of the Option. 
  
 6.  Termination of Employment.    After an Employee’s Employment Termination Date, the rules set forth in this Section 6
shall apply. All factual determinations with respect to the termination of an Employee’s employment that may be relevant under this Section 6 shall be made by the Committee in its sole discretion. 
  
 6.1  Termination Other Than Upon Qualifying Retirement, Death or
Disability or for Cause.   Upon any termination of an Employee’s employment for any reason other than the Employee’s Qualifying Retirement, disability, or death or the Employee’s termination for Cause, unless otherwise
provided in the relevant Option Agreement, the Employee shall have the right during the period ending three months after the Employment Termination Date, but not later than the Option Expiration Date, to exercise any Options that were outstanding on
the Employment Termination Date, if and to the same extent as those Options were exercisable by the Employee on the Employment Termination Date. 
  
 6.2  Qualifying Retirement.    Unless otherwise provided in the Option Agreement itself, the rules set forth in this Section
6.2 shall apply to Options granted pursuant to any particular Option Agreement if an Employee retires from the employ of the Company (I) with the consent of or under guidelines approved by the Committee, (II) before the Option Expiration Date, (III)
after having attained age 55, and (IV) after having served in the employ of the Company for at least five consecutive years, as defined below (a retirement in such circumstances being a “Qualifying Retirement”). 
  

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 (a)  After a Qualifying Retirement and so long as the Employee remains in “Good
Standing,” as defined below: 
  
 (i)  Options granted under the Option Agreement, to the extent not already vested at the date of retirement, will continue to vest as though the Employee remained in the employ of the Company through the fifth anniversary of the
date of retirement; and 
  
 (ii)  the Employee
will be entitled to exercise vested Options granted under the Option Agreement from time to time on any date during the period (the “Extended Exercise Period”) that begins on the date of retirement and ends on the first to occur of (x) the
Option Expiration Date, and (y) the fifth anniversary of the date of retirement. 
  
 (b)  If, at any time during the Extended Exercise Period, the Employee fails to remain in Good Standing, any Options granted under the
Option Agreement that are then outstanding and held by the Employee shall be forfeited and of no force or effect. For these purposes, in order for the Employee to remain in Good Standing during the Extended Exercise Period, the Employee must not
violate the terms of any policy or agreement that the Employee acknowledges or executes in connection with the Option Agreement and must refrain from acting in a manner detrimental to the interests of the Company. 
  
 (c)  If the Employee dies during the Extended Exercise
Period and while in Good Standing, the Options granted under the Option Agreement will thereafter be exercisable to the same extent and at the same times (for so long and only so long after the Employee’s death) as if the Employee had continued
in the employ of the Company through the date of the Employee’s death. 
  
 (d)  Unless otherwise determined by the Committee, the Employee will be deemed to have “served in the employ of the Company for at least five consecutive years” only if the Employee was in the active,
full-time employ of the Company and/or one or more Subsidiaries throughout the five year period ending on the Employment Termination Date. 
  
 6.3  Termination Due To Disability.    Upon any termination of an Employee’s employment due to disability, unless
otherwise provided in the relevant Option Agreement, the Employee, or the Employee’s Representative, shall have the right: 
  
 (a)  to exercise, from time to time during the period ending one year after the Employment Termination Date, but not later than the Option
Expiration Date, any Nonqualified Options that were outstanding on the Employment Termination Date, if and to the same extent those Options were exercisable by the Employee on the Employment Termination Date, and 
  
 (b)  to exercise, from time to time during the period ending
one year after the Employment Termination Date, but not later than the Option Expiration Date, any Incentive Stock Options that were outstanding on the Employment Termination Date, if and to the same extent as those Options were exercisable by the
Employee on the Employment Termination Date (even though exercise of the Incentive Stock Option more than three months after the Employment Termination Date may cause the Option to fail to qualify for Incentive Stock Option treatment under the
Code). 
  
 6.4  Death of an
Employee.    Upon the death of an Employee while employed by the Company or any Subsidiary or within any of the periods referred to in any of Sections 6.1, 6.2, or 6.3 during which any particular Option remains potentially
exercisable: 
  

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 (a)  Unless otherwise provided in the relevant Option Agreement (in which the Committee
may specify a different period of extension of the Option Expiration Date in the event of the death of the Employee), if the Option Expiration Date of any Nonqualified Option that had not expired before the Employee’s death would otherwise
expire before the first anniversary of the Employee’s death, that Option Expiration Date shall automatically be extended to the first anniversary of the Employee’s death, and 
  
 (b)  Unless otherwise provided in the relevant Option Agreement, any Options that are outstanding on the
date of the Employee’s death shall become immediately exercisable in full and the Employee’s Representative shall have the right to exercise any or all of those Options in accordance with Section 5.5, from time to time during the period
ending on the first anniversary of the Employee’s death. 
  
 6.5  Termination for Cause.    Upon any termination of an Employee’s employment for Cause, all of the Employee’s rights with respect to unexercised Options shall expire immediately before the
Employment Termination Date. 
  
 7.  Acceleration Upon Change
of Control.    Unless otherwise specified in the relevant Option Agreement, upon the occurrence of a Change of Control of the Company, each Option theretofore granted to any Employee that then remains outstanding shall become
immediately exercisable in full. 
  
 8.  Assignability.    Except as may be otherwise provided by the Committee and reflected in the Option Agreement, no Option may be transferred other than by will or by the laws of descent and
distribution. During an Employee’s lifetime, only the Employee (or in the case of incapacity of an Employee, the Employee’s attorney-in-fact or legal guardian) may exercise any Option requiring or permitting exercise. 
  
 9.  Adjustment Upon Changes in Common
Shares.    In the event of any stock dividend, stock split, or share combination of the Common Shares or any reclassification, recapitalization, merger, consolidation, other form of business combination, liquidation, or
dissolution involving the Company or any spin-off or other distribution to shareholders of the Company (other than normal cash dividends), (a) the Committee shall make appropriate adjustments to the overall aggregate limit set forth in Section 2.1
and to the specific further limits set forth in Section 2.2 and (b) the Committee shall adjust the number and kind of shares subject to, the price per share under, and the terms and conditions of each then outstanding Option to the extent necessary
and in such manner that the benefits of Employees under all then outstanding Options shall be maintained substantially as before the occurrence of such event. Any adjustment so made by the Committee shall be conclusive and binding for all purposes
of the Plan as of such date as the Committee may determine. 
  
 10.    Purchase For Investment.    Each person acquiring Common Shares pursuant to any Option may be required by the Company to furnish a representation that he or she is acquiring the Common
Shares so acquired as an investment and not with a view to distribution thereof if the Company, in its sole discretion, determines that such representation is required to insure that a resale or other disposition of the Common Shares would not
involve a violation of the Securities Act of 1933, as amended, or of applicable blue sky laws. Any investment representation so furnished shall no longer be applicable at any time such representation is no longer necessary for such purposes.

  
 11.  Withholding of Taxes.    The
Committee may, in its sole discretion and subject to such rules as the Committee may adopt from time to time, permit or require an Employee to satisfy, in whole or in part, any withholding tax obligation that may arise in connection with the grant
of an Option, the lapse of any restrictions with respect to an Option, the acquisition of Common Shares pursuant to any Option, or the 
  

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disposition of any Common Shares received pursuant to any Option by such means as the Committee may determine including, without limitation, by having the Company hold
back some portion of the Common Shares that would otherwise be delivered pursuant to the Option or by delivering to the Company an amount equal to the withholding tax obligation arising with respect to such grant, lapse, acquisition, or disposition
in (a) cash, (b) Common Shares, or (c) such combination of cash and Common Shares as the Committee may determine. The Fair Market Value of the Common Shares to be so held back by the Company or delivered by the Employee shall be determined as of the
date on which the obligation to withhold first arose. The Company shall apply the provisions of this Section 11 only to meet required tax withholding (based on the minimum statutory withholding rates for federal and state tax purposes, including
payroll taxes, that are applicable to the supplemental income recognized by an employee) and shall not withhold (or repurchase) Common Shares in excess of the minimum number required for tax withholding. 
  
 12.  Options in Substitution for Options Granted by Other
Companies.    Options, whether Incentive Stock Options or Nonqualified Options, may be granted under the Plan in substitution for options held by employees of a company who become Employees of the Company or a Subsidiary as a
result of the merger or consolidation of the employer company with the Company or a Subsidiary, or the acquisition by the Company or a Subsidiary of the assets of the employer company, or the acquisition by the Company or a Subsidiary of stock of
the employer company as a result of which it becomes a Subsidiary. The terms, provisions, and benefits of the substitute Options so granted may vary from the terms, provisions, and benefits set forth in or authorized by the Plan to such extent as
the Committee at the time of the grant may deem appropriate to conform, in whole or in part, to the terms, provisions, and benefits of the options in substitution for which they are granted. 
  
 13.  Legal Requirements.    No Options shall be
granted and the Company shall have no obligation to make any payment under the Plan except in compliance with all applicable Federal and state laws and regulations, including, without limitation, the Code and Federal and state securities laws.

  
 14.  Duration and Termination of the
Plan.    The Plan shall become effective and shall be deemed to have been adopted on the date on which it is approved by the shareholders of the Company and shall remain in effect thereafter until terminated by action of the
Board of Directors. No termination of the Plan shall adversely affect the rights of any Employee with respect to any Option granted before the effective date of the termination. 
  
 15.  Amendments.    The Board of Directors, or a duly authorized committee thereof, may alter or
amend the Plan from time to time prior to its termination in any manner the Board of Directors, or such duly authorized committee, may deem to be in the best interests of the Company and its shareholders, except that no amendment may be made without
shareholder approval if the effect of that amendment would: (a) increase the overall aggregate limit set forth in Section 2.1 or any of the specific further limits set forth in Section 2.2, in each case as adjusted by Section 9; (b) expand the
classes of persons to whom Options may be granted under the Plan beyond those specified in Section 3; (c) change the provisions of Section 5.2 with respect to the Exercise Price of Options; (d) change the provisions of Section 5.3 with respect to
the Option Expiration Date of any Option; or (e) eliminate the requirement for shareholder approval of any amendment that would do any of the things enumerated in (a) through (e) of this sentence. The Committee shall have the authority to amend the
terms and conditions applicable to outstanding Options (a) in any case where expressly permitted by the terms of the Plan or of the relevant Option Agreement or (b) in any other case with the consent of the Employee to whom the Option was granted,
except that no amendment of an Option may reduce the exercise price of such Option. Except as expressly provided in the Plan or in the Option Agreement evidencing the Option, the Committee may not, without the consent of the holder of an Option
granted under the Plan, amend the terms and conditions applicable to that Option in a manner adverse to the interests of the Employee. 
  

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 16.  Plan Noncontractual.    Nothing herein contained shall be construed as a
commitment to or agreement with any person employed by the Company or a Subsidiary to continue such person’s employment with the Company or the Subsidiary, and nothing herein contained shall be construed as a commitment or agreement on the part
of the Company or any Subsidiary to continue the employment or the annual rate of compensation of any such person for any period. All Employees shall remain subject to discharge to the same extent as if the Plan had never been put into effect.

  
 17.  Claims of Other
Persons.    The provisions of the Plan shall in no event be construed as giving any person, firm, or corporation any legal or equitable right against the Company or any Subsidiary, their officers, employees, agents, or
directors, except any such rights as are specifically provided for in the Plan or are hereafter created in accordance with the terms and provisions of the Plan. 
  

18.  Absence of Liability.    No member of the Board of Directors of the Company or a Subsidiary, of the Committee, of any
other committee of the Board of Directors, or any officer or Employee of the Company or a Subsidiary shall be liable for any act or action under the Plan, whether of commission or omission, taken by any other member, or by any officer, agent, or
Employee, or, except in circumstances involving his or her bad faith or willful misconduct, for anything done or omitted to be done by himself or herself. 
  
 19.  Severability.    The invalidity or unenforceability of any particular provision of the Plan shall not affect any other
provision hereof, and the Plan shall be construed in all respects as if such invalid or unenforceable provision were omitted herefrom. 
  
 20.  Governing Law.    The provisions of the Plan shall be governed and construed in accordance with the laws of the State of
Ohio. 
  
 21.  Definitions. 
  
 21.1  1934 Act.    The term “1934 Act”
shall mean the Securities Exchange Act of 1934, as amended. 
  
 21.2  Cause.    The Company shall be deemed to have “Cause” for the termination of an Employee’s employment if the Employee has committed any act or series of acts determined by the
Committee (in a determination made either before or after the Employment Termination Date) to warrant discharge from employment, including, without limitation, any act of theft or dishonesty in connection with the Employee’s employment with the
Company, any unauthorized disclosure of confidential information belonging to the Company, or other similar action. 
  
 21.3  Change of Control.    A “Change of Control” shall be deemed to have occurred if at any time or from time to
time after the date of adoption of the Plan: 
  
 (a)  there is a report filed on Schedule 13D or Schedule 14D-1 (or any successor schedule, form, or report), each as adopted under the 1934 Act, disclosing the acquisition of 25% or more of the voting stock of the Company in a
transaction or series of transactions by any person (as the term “person” is used in Section 13(d) and Section 14(d)(2) of the 1934 Act), 
  
 (b)  during any period of 730 consecutive days or less, individuals who at the beginning of such period constitute the directors of the
Company cease for any reason to constitute at least a majority thereof unless the election of each new director of the Company was approved or recommended by the vote of at least two-thirds of the directors of the Company then still in office who
were directors of the Company at the beginning of that period, 
  

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 (c)  the Company merges with or into or consolidates with another corporation following
approval of the shareholders of the Company of such merger or consolidation and, after giving effect to such merger or consolidation, less than 50% of the then outstanding voting securities of the surviving or resulting corporation represent or were
issued in exchange for voting securities of the Company outstanding immediately prior to such merger or consolidation, 
  
 (d)  there is a sale, lease, exchange, or other transfer (in one transaction or a series of related transactions) of all or substantially
all of the assets of the Company following approval of the shareholders of the Company of such transaction or series of transactions, or 
  
 (e)  the shareholders of the Company shall approve any plan or proposal for the liquidation or dissolution of the Company. 
  
 21.4  Code.    The term “Code” shall
mean the Internal Revenue Code of 1986, as amended. 
  
 21.5  Committee.    The term “Committee” shall mean a committee appointed by the Board of Directors of the Company to administer the Plan. The Committee shall be composed of not less than two
directors of the Company. The Board of Directors may also appoint one or more directors as alternate members of the Committee. No officer or Employee of the Company or of any Subsidiary shall be a member or alternate member of the Committee. The
Committee shall at all times be comprised solely of “outside directors” within the meaning of Code Section 162(m) and in such a manner as to satisfy the “non-employee” director standard contained in Rule 16b-3. 
  
 21.6  Common Shares.    The term “Common
Shares” shall mean common shares of the Company without par value. 
  
 21.7  Company.    The term “Company” shall mean STERIS Corporation and its successors, including the surviving or resulting corporation of any merger of STERIS Corporation with or into, or any
consolidation of STERIS Corporation with, any other corporation or corporations. 
  
 21.8  Disability.    An Employee shall be deemed to have suffered a “Disability” if and only if (a) the Employee has established to the satisfaction of the Committee that the Employee is unable
to perform the Employee’s normal duties and responsibilities with the Company by reason of a medically determinable physical or mental impairment that can be expected to result in death or that has lasted or can be expected to last for a
continuous period of not less than 12 months, all within the meaning of Section 22(e)(3) of the Code, and (b) the Employee has satisfied any other requirement that may be imposed by the Committee. 
  
 21.9  Employee.    The term “Employee”
shall mean any individual employed by the Company or by any Subsidiary (including any individual employed by the Company or any Subsidiary who is also a member of the Board of Directors of the Company or of any Subsidiary). 
  
 21.10  Employee’s Representative.    The
term “Employee’s Representative” shall mean, (a) in the case of a deceased Employee, the Employee’s executor or administrator or the person or persons to whom the Employee’s rights under any Option are transferred by will or
the laws of descent and distribution, and (b) in the case of a disabled or incapacitated Employee, the Employee’s attorney-in-fact or legal guardian. 
  

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 21.11  Employment Termination Date.    The term “Employment Termination
Date” with respect to an Employee shall mean the first date on which, as of the end of the day, the Employee is no longer employed by the Company or any Subsidiary. 
  
 21.12  Exercise Price.    The term “Exercise Price” with respect to an Option shall
mean the price specified in the Option Agreement at which the Common Shares subject to the Option may be purchased by the holder of the Option. 
  
 21.13  Fair Market Value.    Except as otherwise determined by the Committee, the term “Fair Market Value” with
respect to Common Shares shall mean the closing sales price of the Common Shares as reported on the national securities exchange on which the Common Shares are traded, or, if applicable, as reported on the New York Stock Exchange (“NYSE”),
on the date for which the determination of fair market value is made or, if there are no sales of Common Shares on that date, then on the next preceding date on which there were any sales of Common Shares. If the Common Shares are not or cease to be
traded on a national securities exchange or on the NYSE, the “Fair Market Value” of Common Shares shall be determined in the manner prescribed by the Committee. 
  
 21.14  Incentive Stock Option.    The term “Incentive Stock Option” shall mean an
Option intended by the Committee to qualify as an “incentive stock option” within the meaning of Section 422 of the Code. 
  
 21.15  Nonqualified Option.    The term “Nonqualified Option” shall mean an Option intended by the Committee not to
qualify as an “incentive stock option” under Section 422 of the Code. 
  
 21.16  Option.    The term “Option,” shall mean an Option entitling the holder thereof to purchase a specified number of Common Shares at a specified price during a specified period of time.

  
 21.17  Option Agreement.    The
term “Option Agreement” shall mean a written instrument evidencing an Option in such form and with such provisions as the Committee may prescribe, including, without limitation, an agreement to be executed by the Employee and the Company,
or a letter executed by the Committee or its designee. Each Option Agreement shall provide that acceptance of the Option Agreement by an Employee constitutes agreement to the terms of the Option evidenced thereby. 
  
 21.18  Option Expiration Date.    The term
“Option Expiration Date” with respect to any Option shall mean the date selected by the Committee after which, except as provided in Section 6.4 in the case of the death of the Employee to whom the option was granted, the Option may not be
exercised. 
  
 21.19  Plan.    The
term “Plan” shall mean this STERIS Corporation 2002 Stock Option Plan as from time to time hereafter amended in accordance with Section 15. 
  
 21.20  Rule 16b-3.    The term “Rule 16b-3” shall mean Rule 16b-3 or any successor provision under the
1934 Act. 
  
 21.21  Subsidiary.    The term “Subsidiary” shall mean any corporation, partnership, joint venture, or other business entity in which the Company owns, directly or indirectly, 50 percent or
more of the total combined voting power of all classes of stock (in the case of a corporation) or other ownership interests (in the case of any entity other than a corporation). 
  

 9STERIS Corporation Management Incentive Compensation Plan.

 EXHIBIT 10.8 
  
 STERIS CORPORATION 
  
 Management Incentive Compensation Plan 
  
 1.
Objective. The objective of the STERIS Management Incentive Compensation Plan (the “Plan”) is to encourage greater initiative, resourcefulness, teamwork, efficiency, and achievement of objectives on the part of key employees whose
performance and responsibilities directly affect STERIS Corporation (the “Company” or “STERIS”) profits. 
  
 2. Eligibility. Participation in the Plan will be limited to those key employees that are selected for participation on an annual basis and will normally include employees
at or above the rank of Manager. 
  
 A key employee will be a participant
in the Plan for a particular year only if he or she is selected by the Compensation Committee of the Board of Directors or its designee (the “Committee”) for participation in that year. Key employees selected for participation each year
will be notified of their participation and given the parameters for bonus calculations early in the fiscal year. 
  
 A participant will be entitled to receive a bonus earned under the Plan for a particular fiscal year if and only if he or she remains in the employ of the Company
through the end of that fiscal year and thereafter through the date on which bonuses are paid for the fiscal year. 
  
 3. Target Bonus. Each participant will be assigned a percentage target bonus based upon his or her position and level within the Company. The target bonus will range from
10% to 80% of the participant’s base salary. 
  
 4. Financial Goals. Each year
the Committee will select a threshold net income target for the Company, the attainment of which will be a prerequisite to the payment of any bonuses under the Plan. In addition, the Committee will select one or more measures of current year
financial performance for the Company as a whole, such as revenue growth, earnings before interest and taxes margins, and net income, to be used as goals for determining the payment of bonuses under the Plan. Each year the Committee may also select
one or more such goals for any one or more of the Company’s operating groups to be used to determine payment of bonuses under the Plan to participants in those groups. The Committee may also determine that a participant’s entitlement to a
bonus will depend in part on goals for the Company as a whole and in part on goals for one or more operating groups. For each financial goal, the Committee will designate numerical “threshold,” “target,” and “maximum”
levels. The Committee may adjust the threshold net income target and levels of such other goals it may have selected if, during the course of a fiscal year, the Company records a special charge that the Committee determines should be disregarded,
either partially or in its entirety, when calculating the amounts of bonuses to be paid under the Plan. 
  
 5. Weighting of Goals. Each year during which the Committee selects more than one goal to be applicable to any group of participants, the Committee will also specify the weight to be given to each such goal. For example,
the Committee might determine to give 75% weight to revenue and 25% weight to EBIT margin. 

 6. Achievement Percentages. For each goal, a participant will be entitled to a bonus (with respect to that goal) based on
performance as follows: 
  
 a. If performance is at the threshold level,
the bonus will be at 50% of target. 
 b. If performance is at the target level, the bonus will be at 100% of target. 
 c. If performance is at or above the maximum level, the bonus will be at 150% of target. 
  
 For performance at any level between these set points, the bonus amount will be interpolated. For example, if performance is exactly
half way between the target and maximum levels, the bonus will be at 125% of target. If the threshold level is not attained for any goal, no bonus will be earned with respect to that goal. 
  
 7. Calculation of Bonuses. No bonuses will be paid for a fiscal year unless the net income of
the Company is at least equal to the threshold net income level selected by the Committee for the year. Assuming that criteria is met, a participant’s bonus will be determined by multiplying his or her target bonus by the achievement
percentages attained during the year, taking into account the weighting of goals as appropriate. The actual bonus earned by any participant during a fiscal year may range from zero (if performance is below threshold on all goals) to 150% of the
target bonus (if performance is at or above maximum on all goals). 
  
 8. Payment of
Earned Bonuses. Unless the Committee determines to pay all or any part of bonuses under the Plan earlier or either of Sections 10 and 11 applies, bonuses earned under the Plan will be paid to participants not later than 90 days after the end of
the fiscal year in which they are earned. 
  
 9. Midyear Additions and Adjustments.
An individual assuming a key position during a fiscal year may, if selected by the Committee, be included in the Plan and be eligible for such pro rata portion of a full year bonus as the Committee may specify when selecting the individual for
participation in the Plan. A participant whose position or level within the Company changes during a fiscal year may, if so determined by the Committee, be assigned an increased or decreased target bonus for the year taking into account, on a pro
rata basis, the participant’s new position and compensation. 
  
 10. Effect of
Changes in Operations. If, during any fiscal year, the operations of the Company are materially altered, whether by an acquisition of substantial additional assets or one or more lines of business, disposition of substantial existing assets or
one or more existing lines of business, merger, consolidation, or similar event, the Committee may, in its sole discretion, adjust the parameters of the Plan for that fiscal year in such a manner as to preserve to the participants the same relative
prospects for earning a bonus under the Plan as would have been the case if the material alteration had not occurred. If the Company disposes of an entire operating division or line of business during a fiscal year, the Company shall make to each
participant, if any, who ceases to be employed by the Company as a result of that disposition, an “Interim Payment” in the same amount, at the same time, and with the same effect, as if the disposition constituted a Change of Control as
defined in Section 11 below. 
  
 11. Effect of a Change of Control. Within five days
after the occurrence of the first Change of Control (as defined below) to occur in any fiscal year, the Company shall pay to each participant 
  

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 an interim lump-sum cash payment (the “Interim Payment”) with respect to his or her participation in the plan. The amount
of the Interim Payment shall be equal to the dollar amount of the participant’s target bonus for the entire fiscal year multiplied by a fraction, the numerator of which is the number of months between the beginning of the fiscal year and the
end of the month in which the Change of Control occurs and the denominator of which is 12. The making of the Interim Payment will not reduce the obligation of the Company to make a final payment under the terms of the Plan, but the amount of any
Interim Payment shall be offset against any later payment due under the Plan for the fiscal year in which the Change of Control occurs. Except as an offset against a final payment as provided in the immediately preceding sentence, the amount of the
Interim Payment will not be offset against any amount due to the participant from or on behalf of the Company and a participant will not in any circumstances be required to refund any portion of the Interim Payment to the Company. 
  
 For purposes of the Plan, a “Change of Control” shall be deemed to have
occurred if at any time or from time to time while this Agreement is in effect: 
  
 (a) Any person (other than STERIS, any of its subsidiaries, any employee benefit plan or employee stock ownership plan of STERIS, or any person organized, appointed, or established by STERIS for or pursuant to the terms of any such plan),
alone or together with any of its affiliates, becomes the beneficial owner of 15% or more (but less than 50%) of the Common Shares then outstanding; 
  
 (b) Any person (other than STERIS, any of its subsidiaries, any employee benefit plan or employee stock ownership plan of STERIS, or any person organized,
appointed, or established by STERIS for or pursuant to the terms of any such plan), alone or together with any of its affiliates, becomes the beneficial owner of 50% or more of the Common Shares then outstanding; 
  
 (c) Any person commences or publicly announces an intention to commence a tender offer
or exchange offer the consummation of which would result in the person becoming the beneficial owner of 15% or more of the Common Shares then outstanding; 
  
 (d) At any time during any period of 24 consecutive months, individuals who were directors at the beginning of the 24-month period no longer constitute a majority
of the members of the Board of Directors of STERIS, unless the election, or the nomination for election by STERIS’s shareholders, of each director who was not a director at the beginning of the period is approved by at least a majority of the
directors who (i) are in office at the time of the election or nomination and (ii) were directors at the beginning of the period; 
  
 (e) A record date is established for determining shareholders entitled to vote upon (i) a merger or consolidation of STERIS with another corporation in which those
persons who are shareholders of STERIS immediately before the merger or consolidation are to receive or retain less than 60% of the stock of the surviving or continuing corporation, (ii) a sale or other disposition of all or substantially all of the
assets of STERIS, or (iii) the dissolution of STERIS; 
  
 (f) (i) STERIS is
merged or consolidated with another corporation and those persons who were shareholders of STERIS immediately before the merger or consolidation receive or retain less than 60% of the stock of the surviving or continuing corporation, (ii) there
occurs a 
  

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 sale or other disposition of all or substantially all of the assets of STERIS, or (iii) STERIS is dissolved; or 
  
 (g) Any person who proposes to make a “control share acquisition” of STERIS,
within the meaning of Section 1701.01(Z) of the Ohio General Corporation Law, submits or is required to submit an acquiring person statement to STERIS. 
  
 Notwithstanding anything herein to the contrary, if an event described in clause (b), clause (d), or clause (f) above occurs, the occurrence of that event will
constitute an irrevocable Change of Control. Furthermore, notwithstanding anything herein to the contrary, if an event described in clause (c) occurs, and the Board of Directors either approves such offer or takes no action with respect to such
offer, then the occurrence of that event will constitute an irrevocable Change of Control. On the other hand, notwithstanding anything herein to the contrary, if an event described in clause (a), clause (e), or clause (g) above occurs, or if an
event described in clause (c) occurs and the Board of Directors does not either approve such offer or take no action with respect to such offer as described in the preceding sentence, and a majority of those members of the Board of Directors who
were Directors prior to such event determine, within the 90-day period beginning on the date such event occurs, that the event should not be treated as a Change of Control, then, from and after the date that determination is made, that event will be
treated as not having occurred. If no such determination is made, a Change of Control resulting from any of the events described in the immediately preceding sentence will constitute an irrevocable Change of Control on the 91st day after the occurrence of the event. 
  

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