This excerpt taken from the UNH DEF 14A filed Apr 30, 2007.
As described in Annual Cash Incentive Awards and Long-Term Cash Incentive Awards above, the performance goals to be satisfied for annual and long-term cash incentive awards are expressed in terms of
two EPS goals for one-year and three-year performance periods. In January 2006, the Compensation Committee set the second EPS goal for annual cash incentive awards for performance in 2006 (paid in 2007) at an amount equal to $2.90, the EPS guidance we provided to investors at the beginning of 2006, and set the initial EPS goal at an amount equal to $2.61, which was 90% of the second goal. In January 2004, the Compensation Committee set the second EPS goal for the 2004-2006 performance period for long-term cash incentive awards (paid in 2007) at an amount equal to $6.13, which was the sum of the EPS guidance we provided to investors for the first year of the performance period and EPS figures for the second and third years of the performance period that represented target annual EPS growth of 15%, and set the initial EPS goal at $5.52, which was 90% of the second EPS goal.
Actual EPS for 2006 was $2.97 and, after giving effect to the restatement of our historical financial statements, actual EPS for the 2004-2006 performance period was $7.11. As a result, we exceeded the second goals for both the annual and long-term cash incentive awards.