STRYKER

2017 Proxy Statement

Issue link: http://catalog.e-digitaleditions.com/i/801297

Contents of this Issue

Navigation

Page 23 of 69

20 and Mr. Jellison of $1,430,011, $462,011, $351,985, $296,972 and $274,983, respectively. These amounts for our 2017 NEOs will be reflected as 2017 compensation in the "Summary Compensation Table" and "2017 Grants of Plan-Based Awards" table in the Company's proxy statement for its 2018 annual shareholders meeting. The adjustments to the 2014 PSUs disqualified them as "performance-based compensation" under Section 162(m) of the Internal Revenue Code. The disqualification of the 2014 PSUs does not have a material impact on the Company's effective tax rate. Beginning with the performance stock units awarded in 2015, the awards have been designed such that similar adjustments would not disqualify the awards as "performance-based compensation" under Section 162(m). The table below presents the performance goals, the actual results for average adjusted diluted net earnings per share growth (to which no changes were made) and the results for relative average sales growth as adjusted by the Committee as described above and the calculated payouts for the 2014 PSUs: Average Adjusted Diluted Net Earnings Per Share Growth Below Minimum Minimum Target Maximum Actual Goal < 7.0% 7.0% 9.0% 11.0% 8.96% Earned 2014 PSUs, as % of Target 0 50 100 200 99 Weighted-Average (50%) Earned 2014 PSUs, as % of Target 49 Relative Average Sales Growth Percentile Ranking Actual Goal Below 33rd 33rd 60th 85th and Above 88 Earned 2014 PSUs as % of Target 0 50 100 200 200 Weighted-Average (50%) Earned 2014 PSUs, as % of Target 100 Total 2014 PSUs earned, as % of Target (1) 149 ______________ (1) The 2014 PSUs earned exclude dividend equivalents, which cannot be calculated until the date of vesting. For those NEOs who were granted 2014 PSUs, the number and market value of the 2014 PSUs that have been earned as of December 31, 2016 and calculated before any adjustments to the relative average sales growth performance calculation but remain unvested until March 21, 2017 are included in the "Number of Shares or Units of Stock That Have Not Vested" and "Market Value of Shares or Units of Stock That Have Not Vested" columns of the "Outstanding Equity Awards at 2016 Fiscal Year-End" table on page 28. The number and market value of the 2014 PSUs as calculated on the adjusted basis as discussed above are presented on page 29 in Note (3) to the "Outstanding Equity Awards at 2016 Fiscal Year-End" table. Retirement Plans: We offer a defined contribution 401(k) plan — the Stryker Corporation 401(k) Savings and Retirement Plan ("401 (k) Plan") — that is available to all eligible U.S. employees, including the NEOs, as well as a nonqualified supplemental defined contribution plan — the Stryker Corporation Supplemental Savings and Retirement Plan ("Supplemental Plan") — in which certain employees, including the NEOs, may participate. The purpose of these plans is to assist our employees and executives with retirement income savings and increase the attractiveness of employment at Stryker. The Supplemental Plan is designed to provide a consistent level of benefit as a percentage of current compensation by restoring benefits that would otherwise be limited due to the covered compensation limits under the tax-qualified 401(k) Plan. The amounts of the Company's matching contribution to the accounts of each NEO are determined by the NEO's eligible compensation and individual contribution rate. Participants may contribute up to 75% of total eligible compensation (salary and bonus for the NEOs) under the 401(k) Plan and Supplemental Plan. Under the 401(k) Plan, we match fifty cents per dollar of the first 8% of compensation contributed by the employee up to the Internal Revenue Code limits ($18,000 annual deferral and $265,000 compensation in 2016). In addition to the Company match, the Company has historically made a discretionary contribution in March of each year equal to 7% of the prior year's eligible compensation for all employees eligible under the 401(k) Plan and Supplemental Plan, including the NEOs. The amounts contributed under the 401(k) Plan and the Supplemental Plan for 2016 on behalf of each NEO are included in the "All Other Compensation" column of the "Summary Compensation Table" on page 24. Additionally, the amounts contributed under the Supplemental Plan for 2016 on behalf of each NEO and his account balance under the Supplemental Plan, along with a description of the 401(k) Plan and Supplemental Plan, are provided in the table on page 30 and the associated narrative. We have defined benefit pension programs for some employees in certain international locations; however, no NEO participates in any defined benefit pension plan sponsored by Stryker. Health and Welfare Benefits Plans: We provide benefits, such as medical, prescription, dental, vision, life insurance and disability coverage, to each NEO under the same benefits plans that we offer to all our eligible U.S.-based employees. The benefits plans are part of our overall total compensation offering and provide appropriate healthcare coverage and security for our employees and their families at costs affordable to the Company. The Company does not pay for any form of post-retirement healthcare benefits for any employee. Perquisites: We provide limited perquisites and personal benefits based on considerations unique to each NEO position. We believe our practices regarding perquisites are conservative to market. In 2016, we paid for costs associated with an executive physical examination for all of our NEOs. In addition, we determined under the Internal Revenue Code and SEC disclosure rules that a personal benefit should be attributed to Mr. Floyd for certain meeting expenses associated with attending and presenting at an Orthopaedics sales force meeting in 2016 at which his spouse joined him. In accordance with SEC disclosure requirements, the values of the above perquisites and other personal benefits are included in the "All Other Compensation" column of the "Summary Compensation Table" (see page 24) for 2016 for Mr. Floyd, who was the only NEO for whom the total value was $10,000 or greater. In December 2016, the Board, excluding Mr. Lobo, approved a policy regarding the personal use of Company aircraft by Mr. Lobo and his immediate family members. The Board believes the policy maximizes the efficient use of Mr. Lobo's travel time and helps to ensure his personal safety and security. Mr. Lobo is the only Stryker executive officer allowed to use Company aircraft for personal use. Such personal use is subject to an annual hour limitation, currently 40 hours, that will be determined and reviewed annually by the Board. Mr.

Articles in this issue

view archives of STRYKER - 2017 Proxy Statement