8-KLeadership ChangesExhibits & Filings

BOSTON SCIENTIFIC CORP 8-K Report, Executive Changes (Oct 28, 2011)

Filed October 28, 2011For Securities:BSX

Summary

Boston Scientific Corporation (BSX) filed an 8-K on October 28, 2011, announcing the retirement of Samuel R. Leno, Executive Vice President and Chief Operations Officer, effective December 31, 2011. This filing details the compensatory arrangements associated with his retirement, including the acceleration of unvested stock options and deferred stock units, with an exception for awards granted on February 28, 2011, for which the service condition was waived by the Compensation Committee. Mr. Leno will also receive benefits under the Executive Retirement Plan and his performance share units will remain outstanding on a prorated basis. Additionally, the filing discloses the termination of the Executive Allowance Program effective December 31, 2011. In consideration for its termination, participating Executive Committee members will receive deferred stock units valued at $75,000. The company also approved the 2012 Performance Incentive Plan (PIP), which maintains a similar structure to the 2011 PIP but shifts the incentive weighting from team (25%) to individual performance (75%) to better align compensation with individual achievements. These changes reflect adjustments in executive compensation and retirement policies.

Key Highlights

  • 1Samuel R. Leno, EVP and Chief Operations Officer, to retire effective December 31, 2011.
  • 2Mr. Leno's unvested stock options and deferred stock units will accelerate upon retirement, with a waiver for the service condition on 2011 awards.
  • 3Mr. Leno will receive benefits under the Executive Retirement Plan and prorated performance share units.
  • 4The Boston Scientific Corporation Executive Allowance Program will be terminated effective December 31, 2011.
  • 5Participants in the terminated Executive Allowance Program will receive $75,000 in deferred stock units.
  • 6The 2012 Performance Incentive Plan (PIP) was approved, effective January 1, 2012.
  • 7The 2012 PIP shifts incentive weighting from team (25%) to individual performance (75%).

Frequently Asked Questions

This 8-K filing primarily announces the retirement of Samuel R. Leno, Executive Vice President and Chief Operations Officer, and details the associated compensatory arrangements. It also announces the termination of the Executive Allowance Program and the approval of the 2012 Performance Incentive Plan.

Mr. Leno's unvested stock options and deferred stock units will accelerate and become exercisable upon his retirement date. Notably, the Compensation Committee waived the usual service condition for awards granted on February 28, 2011, allowing them to accelerate as well.

The company is terminating the Executive Allowance Program and replacing it with a grant of $75,000 in deferred stock units for eligible participants. Additionally, the 2012 Performance Incentive Plan (PIP) has been approved. This plan is similar to the prior year's but increases the weighting for individual performance from 25% to 75%, while reducing the team component from 75% to 25%.

The shift in the PIP weighting from team to individual performance suggests a strategic focus by Boston Scientific to more directly incentivize and reward individual contributions to the company's success. This could impact how employees' performance is evaluated and compensated moving forward.