Program Overview for Medtronic (MDT)

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Medtronic (MDT)

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MDT » Topics » Program Overview

This excerpt taken from the MDT DEF 14A filed Jul 17, 2009.

Program Overview

The following is an illustration of the major components of Medtronic’s compensation programs as applied to each named executive officers with the exception of Mr. DeMane who resigned as Chief Operating Officer of Medtronic effective April 30, 2008.


		• Objective: Provide a base wage that is competitive and reflective of individual performance • Generally represents 11% to 31% of total compensation⁽¹⁾• Objective: Motivate achievement of annual goals • Generally represents 15% to 21% of total compensation provided annual financial objectives are achieved • All executive officers have Company-wide and, if applicable, sector annual business goals⁽²⁾• Objective: Motivate executives to focus on long-term shareholder value creation and strategic financial performance • Core long-term incentive program consists of three distinct components weighted at 1/3 each, with the sum targeting delivery of long-term compensation at approximately the median of market competitive levels • Generally represents 48% to 75% of total compensation • Objective: Ensure impartiality and objectivity in the event of a change-in-control situation to protect shareholder interests • Policy is consistent with design provisions and benefit levels at other similar companies • Objective: Provide reimbursement of some personal and business-related expenses such as memberships, financial and tax planning services in lieu of perquisites and aid in the attraction and retention of top talent • Represents less than 1% of total compensation • Objective: Supports retention, succession planning and recruitment • Used very judiciously • Generally represents a premium over and above our competitive market


(1)		Total compensation is defined as the sum of base salary, target annual cash incentives, and the grant date fair value of long-term equity incentives. It does not necessarily tie to the values disclosed in the Summary Compensation Table and other tables. The chart is not drawn to scale for any particular named executive officer.

(2)		For fiscal year 2010 the bonuses of our executive officers will be based 100% on Company-wide goals.

The compensation mix in the illustration above reflects our bias for pay for performance, as well as our focus on sustained performance. Variable pay (annual and long-term incentives) represents 69% to 89% of total compensation while long-term financial measures and stock performance represent 48% to 75% of total compensation. The percentages above are calculated based on total direct compensation (base salary, annual incentives and long-term incentives) at target and excluding special restricted stock unit awards and compensation related to relocation or expatriate duties.

This excerpt taken from the MDT DEF 14A filed Jul 18, 2008.

Program Overview

The following is an illustration of the major components of Medtronic’s compensation programs as applied to each named executive officer with the exception of Mr. Collins who, in his role as Chairman of the Board, received compensation consisting of base salary, a performance share plan (the “Performance Share Plan”) payout for the 2006 to 2008 performance period and a pro-rata annual incentive payment in fiscal year 2008.


		• Objective: Provide a base wage that is not subject to performance risk • Generally represents 12% to 27% of total compensation for the named executive officers⁽¹⁾• Objective: Motivate executives to achieve annual business goals • Generally represents 14% to 19% of total compensation for the named executive officers⁽¹⁾• All executive officers have corporate and (if applicable) business unit annual business goals • Objective: Motivate executives to focus on long-term shareholder value creation and strategic initiatives • Core long-term incentive program consists of three distinct components targeting delivery of long-term compensation at approximately the median of market competitive levels • Generally represents 55% to 74% of total compensation for the named executive officers • Objective: Supports succession planning, recruiting and retention • Used judiciously • Generally represents a premium over and above our competitive market • Objective: Ensure impartiality and objectivity in the event of a change-in-control situation to protect shareholder interests • Policy is consistent with design provisions and benefit levels at other similar companies • Given in lieu of perquisites • Represents a nominal amount of total compensation for the named executive officers (e.g., $40,000 for CEO)


(1)		Total compensation is defined as the sum of base salary, target annual cash incentives, and the grant date fair value of long-term equity incentives, and does not necessarily tie to the values disclosed in the Summary Compensation Table and supplemental tables. The chart is not drawn to scale for any particular named executive officer.

The compensation mix in the illustration above reflects our pay philosophy, which emphasizes performance-based pay (annual and long-term incentives represent 73% to 88% of total compensation),

and a focus on long-term financial measures and stock performance (55% to 74% of total compensation). In delivering a relatively large percentage of total compensation in the form of long-term incentives, our intent is to deliver maximum value to the named executive officer only when value is delivered to shareholders in the form of both stock performance and long-term financial performance. The percentages are calculated based on total direct compensation (base salary, annual incentives and long-term incentives) excluding special time-based restricted stock awards and excluding compensation related to relocation or expatriate duties.

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DEF 14A	Jul 17, 2009

DEF 14A	Jul 18, 2008

Medtronic (MDT)

MDT » Topics » Program Overview

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