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JOHNSON & JOHNSON 10-K 2006 Documents found in this filing:
EXHIBIT 10(s)
Summary
of Compensation Arrangements for
Named Executive Officers and Directors
Following is a description of the compensation arrangements that
have been approved by the Compensation & Benefits
Committee of the Board of Directors of Johnson &
Johnson (the “Compensation Committee”) on
February 13, 2006 for the Company’s Chief Executive
Officer and the other four most highly compensated executive
officers in 2005 (the “Named Executive Officers”).
The Compensation Committee approved the following base salaries,
effective February 27, 2006, for the Named Executive
Officers:
The Compensation Committee has approved the following bonus
payments for performance in 2005 (divided at the discretion of
the Compensation Committee between cash and the fair market
value of Common Stock awards on February 17, 2006):
The Compensation Committee approved the following stock option
and Restricted Share Unit (“RSU”) grants under the
Company’s 2005 Long-Term Incentive Plan. The stock options
were granted at an exercise price of $58.34, which was the fair
market value of the Company’s Common Stock on the date of
grant. The options will become exercisable on February 13,
2009
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and expire on February 12, 2016. The RSUs were granted at
the fair market value of the Company’s Common Stock on the
date of grant. The RSUs will vest on February 13, 2009,
upon which for each RSU, the holder, if still employed by the
Company on such date, will receive one share of the
Company’s Common Stock.
The Compensation Committee approved the following long-term
incentive plan awards on February 13, 2006 in recognition
of performance during 2005 under the Company’s Certificate
of Extra Compensation (“CEC”) program. Awards are not
paid out until retirement or other termination of employment. As
of the end of fiscal year 2005, the CEC value per unit was
$23.16. The value of the CEC units is preliminary and is subject
to increase or decrease based on the performance of the Company.
Each Non-Employee Director receives an annual fee of $85,000 for
his or her services as director. In addition, directors receive
$5,000 for service on a committee of the Board of Directors or
$15,000 if chairperson of the committee. The Presiding Director
is paid an annual fee of $10,000.
Under the 2005 Long-Term Incentive Plan, each Non-Employee
Director receives non-retainer equity compensation each year in
the form of restricted or deferred stock having a value of
$100,000. Each Non-Employee Director received a grant of
1,714 shares of restricted stock, based upon the fair
market value of the Common Stock of the Company on
February 13, 2006, for service on the Board in 2005, except
for Mr. Charles Prince, who was elected to the Board on
that date. Each director receives a one-time grant of
1,000 shares of Company Common Stock upon first becoming a
member of the Board of Directors.
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