Michael Petras, Jr.
About Michael Petras, Jr.
Michael B. Petras, Jr. is Chairman and Chief Executive Officer of Sotera Health (SHC), serving as CEO since June 2016 and Chair since October 2020; age 57. He previously led Cardinal Health’s Post-Acute Solutions and Cardinal Health at-Home, was CEO of AssuraMed, and earlier served as President & CEO of GE Lighting, following 20+ years at GE across multiple functions . Under his leadership, Sotera marked its 19th consecutive year of revenue growth in 2024 (+4.9% reported; +5.4% constant currency), with 2024 Annual Incentive Plan (AIP) results paying at 94% of target on the company metric; in Q3’25, revenue grew 9.1% and Adjusted EBITDA grew 12.2% year-over-year, with margin expansion and improved leverage (net leverage 3.3x vs 3.7x at YE’24) .
Governance note: SHC combines Chair/CEO roles but appointed a Lead Independent Director in January 2025; sponsors (Warburg Pincus, GTCR) retain certain designation and committee rights under a Stockholders Agreement; Petras is not an “independent” director per Nasdaq standards .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| GE Lighting (GE) | President & CEO | 2008–2011 | Led global lighting business within GE; broad commercial and operational leadership |
| AssuraMed Holdings | Chief Executive Officer | 2011–2013 | Led medical products supplier later sold to Cardinal Health |
| Cardinal Health at-Home | Chief Executive Officer | 2013–2015 | Drove at-home healthcare distribution/services platform |
| Cardinal Health | CEO, Post-Acute Solutions | 2015–2016 | Led post-acute strategy and operations |
| Sotera Health | CEO (also Chair of Board since 2020) | 2016–present | 19 consecutive years of revenue growth; 2024 AIP company component paid 94% of target; continued growth in 2025 YTD |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Cleveland Clinic | Director; Vice Chair of the Board | Director since 2016; Vice Chair since 2020 | Major non-profit health system governance role |
| John Carroll University | Director | n/a | University board service |
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary (paid) | $1,050,000 | $1,088,365 |
| Annual Base Salary Rate | $1,050,000 (set Mar 2022) | $1,102,500 (effective Apr 1, 2024) |
| Target Bonus (% of salary) | 125% | 125% |
| Actual AIP Payout (% of salary) | 108% ($1,137,938) | 118% ($1,278,830) |
| Perquisites (Exec physical, 401k, insurance) | $17,375 | $18,004 |
Notes: 2024 company AIP metric paid at 94% of target; Petras’ individual performance factor was 100% of target .
Performance Compensation
- 2024 long-term equity target increased to $8,000,000; mix 50% stock options / 50% RSUs; options 10-year term, 3-year ratable vesting; RSUs vest ratably over 3 years .
- 2025 design shift (shareholder-aligned): eliminated options, introduced PSUs (3-year revenue and FCF goals), SAUs for CEO tied to 3-year stock price improvement, and performance features added to RSUs; at least 50% of 2025 LTI is performance-based .
2024 AIP design and outcomes:
| Component | Metric | Weighting | Threshold | Target | Max | Actual | Payout factor |
|---|---|---|---|---|---|---|---|
| Company performance (for CEO) | Adjusted EBITDA ($mm) | 80% | $506.1 | $562.7 | $630.2 | $548.6 | 94% of target |
| Individual performance (CEO) | Values/Goals | 20% | — | — | — | 100% | 100% of target |
| Total | — | 100% | — | — | — | — | Actual payout: 118% of salary ($1,278,830) |
2024 LTI grants (March 4, 2024):
| Award type | Shares/Options | Exercise Price | Vesting | Grant-date value |
|---|---|---|---|---|
| Stock Options | 544,509 | $14.59 | 1/3 annually over 3 years (from Mar 2, 2025) | $4,007,275 |
| RSUs | 274,160 | n/a | 1/3 annually over 3 years (from Mar 2, 2025) | $3,999,994 |
Vesting/realization:
| 2024 Stock/RSU Vesting (CEO) | Shares vested | Value realized |
|---|---|---|
| RSUs/restricted stock vested in 2024 | 198,686 | $2,804,825 |
Equity Ownership & Alignment
- Beneficial ownership: 9,725,592 shares (3.43% of outstanding) as of March 28, 2025; includes trusts controlled by Petras and options exercisable within 60 days (4,156,199 options) .
- Stock ownership guidelines: CEO required to hold 5x salary; Petras is in compliance (as of Mar 31, 2024) .
- Hedging/pledging: Company policy prohibits hedging and short sales; pledging is prohibited unless pre-approved; no pledging noted for Petras in proxy disclosures .
Outstanding equity (12/31/2024):
| Instrument | Exercisable | Unexercisable | Exercise Price | Expiration | Unvested RSUs (#) | Unvested RSUs FMV |
|---|---|---|---|---|---|---|
| Stock Options (IPO 2020) | 1,118,012 | — | $23.00 | 11/20/2030 | — | — |
| Stock Options (Mar 2, 2022) | 319,288 | 159,644 | $20.03 | 3/2/2032 | — | — |
| Stock Options (Nov 7, 2022) | 2,108,356 | — | $6.37 | 11/7/2032 | — | — |
| Stock Options (Mar 6, 2023) | 134,698 | 269,396 | $17.59 | 3/6/2033 | — | — |
| Stock Options (Mar 4, 2024) | — | 544,509 | $14.59 | 3/4/2034 | — | — |
| RSUs (multiple grants) | — | — | — | — | 62,407; 142,126; 274,160 | $853,728; $1,944,284; $3,750,509 (FMV at $13.68) |
Employment Terms
Key terms (Amended & Restated CEO Employment Agreement; IPO assignment):
- Current salary basis: Initially $1,000,000 at IPO; raised to $1,050,000 (Mar 2022); effective rate $1,102,500 as of Apr 1, 2024; target bonus 125% of salary .
- Severance (without cause / good reason): 2x base salary payable lump sum; 12 months COBRA premium reimbursement equivalent; 2 years of additional time-based vesting credit on outstanding equity .
- Change-in-control: Double-trigger equity vesting if awards are assumed/substituted and termination without cause or resignation for good reason occurs within 12 months post-CIC; if not assumed, unvested awards vest at CIC .
- Restrictive covenants: Non-compete and non-solicit for 24 months post-termination; indefinite confidentiality/non-disparagement .
- Clawback: Mandatory recovery of erroneously awarded incentive-based compensation upon accounting restatement, regardless of misconduct; applies to stock price/TSR-based awards (effective Oct 2, 2023) .
Estimated post-employment values (as of 12/31/2024; stock price $13.68):
| Scenario | Cash Severance | COBRA Continuation | Accelerated Equity Value |
|---|---|---|---|
| Termination without Cause / Good Reason | $2,205,000 | $16,978 | $5,298,332 |
| Death or Disability | — | — | $5,298,332 (2 years vesting credit) |
| Qualifying Retirement | — | — | $2,798,011 (full vesting per retirement rule) |
| CIC with qualifying termination | $2,205,000 | $16,978 | $6,548,520 |
Board Governance
- Board structure: Classified board; sponsors retain director designation and proportional committee representation rights under a Stockholders Agreement; sponsor designees do not sit on Audit; Warburg Pincus appoints LDC Committee Chair while it retains designation rights .
- Leadership: Combined Chair/CEO; Lead Independent Director (Vincent Petrella) appointed in Jan 2025 with authority to coordinate independent director activities, approve info to Board, and preside over executive sessions .
- Independence: Petras is not independent; all other directors and nominees are independent per Nasdaq standards .
- Committees: Audit; Leadership Development & Compensation (LDC); Nominating & Corporate Governance (NCG); EO Litigation; Nordion Pricing; regular executive sessions held without management .
- Director compensation: CEO receives no additional pay for director service (covered in NEO comp) .
Compensation Structure Analysis
- Mix and alignment: In 2024, 89% of CEO’s target pay was performance-based, with 76% tied to future performance via equity; for 2025, SHC heightened performance alignment by replacing options with PSUs (3-year revenue and FCF goals) and SAUs for the CEO .
- Targets and rigor: 2024 AIP used Adjusted EBITDA at the consolidated level; SHC reports shareholder feedback favored multi-year performance metrics and a larger performance-based LTI component; SHC incorporated that in 2025 design .
- Pay outcomes vs performance: 2024 consolidated performance produced a 94% Company AIP factor; CEO’s AIP paid at 118% of salary with individual score at 100%; strong investor support with 2024 Say-on-Pay >98% approval .
- Peer group/market: LDC uses a healthcare tools/devices/services peer group (e.g., STERIS, Waters, Teleflex, ResMed, West, Hologic, etc.) to benchmark target levels and design .
Say-on-Pay & Shareholder Feedback
- 2024 Say-on-Pay: >98% approval .
- Responsive changes for 2025 awards: elimination of options; PSUs with 3-year revenue/FCF goals ≥50% of LTI; CEO awarded SAUs tied to stock price; RSUs for non-CEO NEOs include performance feature .
Risk Indicators & Red Flags
- Dual role concentration: CEO also serves as Chair; mitigant via Lead Independent Director and regular executive sessions .
- Sponsor influence: Warburg Pincus/GTCR retain director designation and committee representation rights, potentially impacting governance dynamics; Audit Committee independence protected .
- Clawback and no hedging: Robust clawback in place and prohibition on hedging/shorting; pledging restricted (advance approval required) .
- Litigation context: Extensive EO-related litigation oversight through an EO Litigation Committee; management provides regular updates (e.g., Q3’25 Georgia/Illinois developments) .
Director/Officer Equity and Vesting Pressure
- 2024 vesting/realization: CEO realized $2.80m from stock/RSUs vesting in 2024; multiple tranches of RSUs/stock options continue to vest through 2027; vesting cadence may create routine liquidity windows but no hedging permitted and no pledging disclosed .
Investment Implications
- Pay-performance alignment improving: 2025 LTI design elevates multi-year, performance-based equity (PSUs, SAUs), reducing “fixed” or time-based risk and strengthening alignment with revenue, FCF, and stock-price outcomes .
- Retention risk moderate: CEO severance (2x salary) and double-trigger equity vesting plus retirement-eligibility vesting protections provide retention ballast; stock ownership guideline compliance further aligns incentives .
- Governance watchpoints: Combined Chair/CEO and sponsor rights warrant continued monitoring; Lead Independent Director role, independent committees (esp. Audit), and robust clawback mitigate risks .
- Operational execution: 2024 results modestly below AIP target (94% factor), but 2025 YTD shows accelerating growth, margin expansion, deleveraging, and proactive shareholder-aligned comp changes—collectively supportive for long-term TSR if sustained .
Appendices
2024 Summary Compensation (CEO)
| Year | Salary | Stock Awards | Option Awards | Non-Equity Incentive (AIP) | All Other | Total |
|---|---|---|---|---|---|---|
| 2024 | $1,088,365 | $3,999,994 | $4,007,275 | $1,278,830 | $18,004 | $10,392,468 |
2024 AIP Targets (Company and Sterigenics benchmarks for context)
| Metric | Threshold | Target | Maximum |
|---|---|---|---|
| Company Adjusted EBITDA ($mm) | $511.5 | $568.6 | $636.8 |
| Actual Company Adjusted EBITDA | $548.6 | — | — (97.5% of target; 94% payout factor) |
Ownership Snapshot (as of March 28, 2025)
| Holder | Shares | % Outstanding |
|---|---|---|
| Michael B. Petras, Jr. | 9,725,592 | 3.43% |
Board Service and Independence
| Director | Class/Term | Independent | Committees |
|---|---|---|---|
| Michael B. Petras, Jr. (Chair & CEO) | Class I, term ends 2027 | No | — |
Executive/Director Policies
- Stock Ownership Guidelines: CEO 5x salary; compliant (3/31/24) .
- Hedging/Pledging: Hedging and shorting prohibited; pledging prohibited unless pre-approved .
- Clawback: Mandatory for restatements; includes stock price/TSR-based compensation .
Performance Highlights
- 2024: Revenue +4.9% (reported); business-unit highlights and ongoing EO risk management; AIP consideration .
- Q3’25: Revenue +9.1%; Adjusted EBITDA +12.2%; margin +147 bps; net leverage 3.3x; raised 2025 Adjusted EBITDA outlook; maintained revenue outlook; litigation updates .
References: .