8-KLeadership ChangesExhibits & Filings

BOSTON SCIENTIFIC CORP 8-K Report, Executive Changes (Nov 22, 2024)

Filed November 22, 2024For Securities:BSX

Summary

Boston Scientific Corporation (BSX) has filed an 8-K report detailing the approval of its 2025 compensation plans for key personnel, including executive officers. The company's Board of Directors, upon recommendation from its Compensation Committee, has adopted the 2025 Annual Bonus Plan and two new performance share programs: the 2025 Relative Total Shareholder Return Performance Share Program (rTSR PSP) and the 2025 Organic Net Sales Growth Performance Share Program (Organic Net Sales PSP). These plans are designed to align executive compensation with company performance and shareholder interests, featuring metrics such as global sales, adjusted earnings per share, operating income, environmental, social, and governance (ESG) goals for the annual bonus, and relative total shareholder return and organic net sales growth over a three-year period for the performance shares. The structures are largely similar to the prior year's plans, with provisions for bonus payouts ranging from 0% to 225% of target for individuals and performance share awards ranging from 0% to 200% of target, contingent on meeting specific criteria. Importantly, all awards are subject to clawback provisions and recoupment policies in cases of executive misconduct or material policy violations causing significant harm to the company.

Key Highlights

  • 1Approval of the 2025 Annual Bonus Plan, similar to the 2024 plan, with payouts based on company-wide goals (global sales, adjusted EPS, operating income, ESG) and individual performance, offering a potential maximum payout of 225% of target.
  • 2Adoption of two new three-year performance share programs for 2025: the Relative Total Shareholder Return (rTSR) PSP and the Organic Net Sales Growth PSP.
  • 3The rTSR PSP measures BSX's Total Shareholder Return against the S&P 500 Healthcare Index over three years (2025-2027), with awards ranging from 0% to 200% of target based on relative TSR ranking.
  • 4The Organic Net Sales PSP incentives achievement of key business objectives, measured by organic net sales growth over the 2025-2027 period against the company's financial plan, with awards ranging from 0% to 200% of target.
  • 5Both performance share programs use restricted stock units issued under the 2011 Long-Term Incentive Plan.
  • 6All bonus and performance share awards for certain executive officers are subject to the company's discretionary recoupment policy and Dodd-Frank Clawback Policy, allowing for recovery in cases of misconduct or gross dereliction of duty causing significant harm.
  • 7Specific provisions regarding forfeiture of performance share awards for retirement before January 1, 2026, are included.

Frequently Asked Questions

The 2025 Annual Bonus Plan's payout is determined by company-wide goals including global sales, adjusted earnings per share (EPS), operating income (as a percent of sales), and attainment of environmental, social, and governance (ESG) scorecard goals. Individual performance also influences the final award through a performance modifier.

The 2025 Relative Total Shareholder Return (rTSR) Performance Share Program aligns executive pay with stock performance by comparing BSX's TSR to peers in the S&P 500 Healthcare Index over three years. The 2025 Organic Net Sales Growth Performance Share Program links pay to the company's ability to grow its core business, measured by organic net sales growth over the same three-year period.

For the 2025 Annual Bonus Plan, an individual participant can achieve a maximum payout of 225% of their target bonus. For the 2025 Performance Share Programs (both rTSR and Organic Net Sales), the number of performance shares awarded can range from 0% to 200% of each participant's target number of awards, contingent on meeting the respective performance criteria.

Yes, awards to certain executive officers under both the 2025 Annual Bonus Plan and the 2025 Performance Share Programs are subject to the company's discretionary recoupment policy and the Dodd-Frank Clawback Policy. These policies allow the company to seek reimbursement of awards in the event of executive misconduct or gross dereliction of duty that results in a material violation of company policy and causes significant harm.