Company: ISRG
Filing Date: 2025-03-14
Form Type: DEF 14A
Source: 0001035267-25-000098
Chunk: 39

Company: INTUITIVE SURGICAL INC
Filing Date: 2025-03-14
Form: DEF 14A
Chunk 39
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 long-term incentive plan expenses, non-cash amortization of intangible assets, litigation charges, gain on a sale of a business, contributions to the Intuitive Foundation, and other adjustments, primarily related to inventory cost accounting and operating expense hedging.

The Company Performance Goals are established at the corporate level by the executive team and Dr. Guthart and then reviewed and approved by our Board annually at the beginning of the year. For 2024, the Company Performance Goals fell into five categories: Support Our Customers; Innovation; Operational Excellence; Quality; and Financial. Given their relationship to our annual operating plan and business strategy and because the Company Performance Goals and their specific target levels are highly confidential, we do not publicly disclose them. We believe their disclosure would provide our competitors, customers, and other third parties with significant insights regarding our confidential business strategies that could cause us substantial competitive harm.

The Company Performance Goals are designed to focus on the short-term objectives that we believe ultimately drive the long-term success of the Company. There is a risk that payments with respect to any specific goal will not be made at all or will be made at less than 100% of the target level. The achievement of the goals may be affected by several factors including, but not limited to, the impact of changes in healthcare legislation and policy, global and regional conditions, credit markets and the related impact on healthcare spending, timing and success of product development and market acceptance of developed products, changes in trade agreements and/or tariffs imposed on cross-border commerce, and regulatory approvals, clearances, and restrictions. Because several of these factors are not entirely within the control of our executives and given the “stretch” nature of the goal-setting process, we believe that it would be relatively difficult to fully achieve the Company Performance Goals in any year. The challenge of the goals and uncertainty in the environment ensures that any payments under the CIP are truly performance-based, which is consistent with the plan’s objectives.

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The following table outlines the 2024 CIP incentive pool funding level that would be attained based on the AOI goal and the Company Performance Goals at the threshold (0%), target (100%), and maximum (125%) achievement levels. Where achievement is obtained between any two levels, the CIP funding level is determined using linear interpolation.

|                                                                     |     |                           |     | CIP Funding Level |     |               |     |                |
| CIP Goal                                                            |     | Performance Weighting (%) |     | Threshold (0%)(1) |     | Target (100