Exhibit 10.21


Description of Certain Compensatory Arrangements 


Executive Compensation.


On November 17, 2005, Varian Medical Systems, Inc.
(the “Company”) announced that Richard M. Levy, Chairman of the Board and Chief
Executive Officer of the Company, will retire as Chief Executive Officer
effective as of the close of business on February 17, 2006, and the Board
of Directors of the Company (the “Board”) appointed Timothy E. Guertin as the
Company’s new Chief Executive Officer, in addition to his title as President,
effective as of close of business on February 17, 2006. In connection with
Mr. Guertin’s new position, the Board approved an annual base salary for Mr. Guertin
of $700,000, to be effective as of the close of business on February 17,
2006.


Also
on November 17, 2005, the Compensation and Management Development
Committee of the Board approved new compensation arrangements for the other
named executive officers (determined by reference to the Company’s 2005 proxy
statement dated December 28, 2004), as well as Dow R. Wilson, who joined
the Company in January 2005 and currently serves as Corporate Executive
Vice President.1 Set forth below are the annual base salaries
effective on December 31, 2005:




	
  Elisha W. Finney,

  	
   

  	
  $

  	
  410,000

  	
   

  
	
  Corporate Senior Vice President
  and Chief Financial Officer

  	
   

  	
   

  	
   

  
	
  Robert H. Kluge,

  	
   

  	
  $

  	
  356,000

  	
   

  
	
  Corporate Vice President

  	
   

  	
   

  	
   

  
	
  Dow R. Wilson,

  	
   

  	
  $

  	
  528,000

  	
   

  
	
  Corporate Executive Vice President

  	
   

  	
   

  	
   

  






 


Dr. Levy, who will continue as a non-executive
employee of the Company and as Chairman of the Board after February 17,
2006, will receive an annual salary of $500,000 effective as of the close of
business on February 17, 2006.


In
addition, the Compensation and Management Development Committee set the
performance goals for the named executive officers and certain other executives
for fiscal year 2006 Management Incentive Plan (“MIP”) payment, all of which
are based on a percentage earnings before interest and taxes (“EBIT”) growth
formula. For Mr. Guertin and Ms. Finney, their performance goals are
based 100% on Company-wide EBIT performance. For Mr. Kluge, his
performance goal is based 50% on EBIT performance of the X-Ray Products
business segment and 50% on Company-wide EBIT performance and, for Mr. Wilson,
his performance goal is based 50% on EBIT performance of the Oncology Systems
business segment and 50% on Company-wide EBIT performance. Achievement of 100%
of the goal will entitle the individuals listed below to the percentage of base
salary that appears opposite his or her name below.




	
  Timothy Guertin2

  	
   

  	
  100

  	
  %

  
	
  Elisha W. Finney

  	
   

  	
  80

  	
  %

  
	
  Robert H. Kluge

  	
   

  	
  60

  	
  %

  
	
  Dow R. Wilson3

  	
   

  	
  80

  	
  %

  






 










1.                 Mr. Wilson’s
compensation arrangements are governed by an employment letter, as amended.


2.                 Mr. Guertin’s
fiscal year 2006 target percentage upon achievement of 100% of the performance
goals is 80% of base salary until February 17, 2006 and moves to 100% of base
salary thereafter.











3.                 Mr. Wilson’s fiscal
year 2006 target percentage of 80% of base salary upon achievement of 100% of
the performance goals represents a modification to Mr. Wilson’s employment
letter, as amended, which originally set forth a fiscal year 2006 target
percentage of 75% of base salary.


Dr. Levy will receive
a prorated MIP payment for fiscal year 2006 through February 17, 2006. His
performance goal is based 100% Company-wide EBIT performance and achievement of
100% of the goal will entitle him to a prorated portion of 100% of his fiscal
year end 2005 base salary.


Compensation
for Levy as Non-Executive Employee


On November 17,
2005, the Board also approved the following compensation arrangement for Dr. Levy
in his role as a non-executive employee of the Company, to be effective as of
the close of business on February 17, 2006:


·       base
salary of $500,000 per annum;


·       provision
of a leased offsite office space at fair market value;


·       provision
of a part-time administrator; and


·       payment
of accrued paid-time-off (“PTO”) at his annual base salary rate as of the end
of fiscal year 2005.


Effective as of the
close of business on February 17, 2006, Mr. Levy will be:


·       ineligible
to accrue PTO effective as of the close of business on February 17, 2006


·       ineligible
to participate in executive perquisite programs, including the Executive Car
Program and reimbursement for executive physicals and for financial, estate and
tax planning services; and


·       ineligible
for grants of stock options in fiscal year 2006.


In his new role as a
non-executive employee of the Company (and in addition to his responsibilities
as Chairman of the Board), Dr. Levy will provide on-going advice and
counsel to the management of the Company on strategic business and
technological matters, will continue to have involvement with investor groups
and key customers and will provide transitional support.


Director Compensation.


On November 17, 2005, the Board approved a new structure
for the cash portion of the non-employee director compensation. The new cash compensation,
which takes effect on February 16, 2006, provides that each director who
is not a Company employee will receive an annual retainer of $45,000. The “lead”
outside director will receive an extra annual retainer of $15,000, the chairs
of the Compensation and Management Development Committee and the Nominating and
Corporate Governance Committee will receive an extra $10,000 annual retainer,
and the chair of the Audit Committee will receive an extra $15,000 annual
retainer. Each non-employee director also will receive meeting fees as follows
for each meeting that he or she attends:




	
   

  	
   

  	
  Attended meeting in-person

  	
   

  	
  Attended meeting by

  telephone or video conference

  	
   

  
	
  In-person Board
  meeting

  	
   

  	
   

  	
  $

  	
  2,000

  	
   

  	
   

  	
   

  	
  $

  	
  1,000

  	
   

  	
   

  
	
  Telephonic Board
  meeting

  	
   

  	
   

  	
  N/A

  	
   

  	
   

  	
   

  	
  $

  	
  2,000

  	
   

  	
   

  
	
  In-person
  Committee meeting

  	
   

  	
   

  	
  $

  	
  1,500

  	
   

  	
   

  	
   

  	
  $

  	
  750

  	
   

  	
   

  
	
  Telephonic Committee
  meeting

  	
   

  	
   

  	
  N/A

  	
   

  	
   

  	
   

  	
  $

  	
  1,500

  	
   

  	
   

  






 


Each non-employee director also receives reimbursement
for out-of-pocket expenses of the director and the director’s spouse associated
with attending such meetings.


Directors may convert their annual retainers to
options to purchase the Company’s common stock at the rate of $1 cash to $4 of
stock options, at an exercise price equal to the fair market value of the
common 











stock on the grant date. These options are immediately
exercisable and expire ten years after the grant date unless terminated
earlier. Directors may
alternatively elect to defer their retainer and/or meeting fees under the
Varian Medical Systems, Inc. 2005 Deferred Compensation Plan described
below.