Company: ISRG
Filing Date: 2025-03-14
Form Type: DEF 14A
Source: 0001035267-25-000098
Chunk: 41

Company: INTUITIVE SURGICAL INC
Filing Date: 2025-03-14
Form: DEF 14A
Chunk 41
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 requirements creates a substantial retention incentive and encourages our executive officers to focus on our long-term business objectives and driving long-term stock price performance. We further believe using this equity incentive compensation mix rewards each executive officer for their contributions to the future success of the Company and incentivizes them to work towards the Company’s long-term critical performance goals, including through the use of stretch company-based goals with respect to the PSUs.

For 2024, executives, including the named executive officers, were generally granted PSUs as one-half of their equity mix, with the remainder of their equity award value granted in the form of RSUs. RSUs and PSUs are generally granted once per year in February, other than in connection with new hires and promotions. The RSUs vest 25% annually over a four-year period, while the PSUs are eligible to vest as 0-125% of the target number of PSUs after a three-year period based on the achievement of the applicable performance objectives.

Stock option awards were generally granted bi-annually in February and August, other than in connection with new hires and promotions. For currently outstanding unvested stock options, the February stock option grants vest 1/8 upon completion of six months of service and 1/48 per month thereafter, through a four-year period, while the August stock option grants vest 7/48 upon completion of one month of service and 1/48 per month thereafter, through a 3.5-year period.

Individual grant awards are determined by the Compensation Committee after considering various factors, including a competitive market analysis prepared by our compensation consultant, the current value of our common stock, the overall available stock pool under our active equity plans, and the individual performance of each NEO. The Compensation Committee also considers Dr. Guthart’s recommendations for the other NEOs when approving equity awards. The Compensation Committee determines and presents its equity award recommendation for Dr. Guthart to the independent members of the Board for their ratification.

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Beginning in 2022, the Compensation Committee implemented a performance equity award program in the form of PSUs to reward the creation of long-term value for the Company and more closely align executives with shareholder interests. As of December 31, 2024, we had three types of active PSUs: the 2024 PSUs, the 2023 PSUs, and the 2022 PSUs.

All active PSUs are eligible to be earned over an approximately three-year performance period based on actual performance as determined by the Compensation Committee and continued