Document:

Exhibit 10.42

Terms of Non-Employee Director
Compensation

Under the Medtronic, Inc. 2008 Stock Award and Incentive Plan

(as adopted August 24, 2011)

          Each
director serving on the Board who is not an employee of the Company or an
Affiliate (each, a “Non-Employee Director”) shall be compensated as provided
below and as determined by the Board from time to time (the terms set forth
below shall remain in effect until modified by the Board or the Nominating and
Corporate Governance Committee of the Board). Equity compensation awards
granted pursuant to this Exhibit A shall be granted under the Medtronic, Inc.
2008 Stock Award and Incentive Plan (the “Incentive Plan”). Unless otherwise
defined below, capitalized terms set forth in this Exhibit A shall have the
meaning given to them in the Incentive Plan.

Annual Retainers and Annual
Stipends

          Each
Non-Employee Director shall be paid an annual retainer equal to $80,000 (the
“Annual Retainer”). Any Non-Employee Director serving as Chair of any of the
Nominating and Corporate Governance, Compensation, or Finance and Technology
and Quality Committees of the Board shall receive, in addition to the Annual
Retainer, an annual stipend of $10,000 (the “Annual Stipends”). 

          Any
Non-Employee Director serving as Lead Director of the Board shall receive, in
addition to the Annual Retainer, an annual stipend of $20,000 (the “Lead
Director Stipend”).

          Any
Non-Employee Director serving as Chair of the Audit Committee of the Board
shall receive, in addition to the Annual Retainer, an annual stipend of
$19,000, and any other Non-Employee Director serving as a member of the Audit
Committee shall receive an Annual Stipend of $5,000 (the “Audit Committee
Annual Stipends”).

                    Unless
deferred by a director pursuant to the terms of the Company’s Capital
Appreciation Plan, the Annual Retainer, Annual Stipends, Lead Director Stipend
and Audit Committee Annual Stipends shall be paid in cash in two equal
installments payable, respectively, within 10 days following the end of the
Company’s second fiscal quarter and within 10 days following the end of the
Company’s fiscal year. Notwithstanding the foregoing, the amount payable in
respect of the Annual Retainer, Annual Stipends, Lead Director Stipend and
Audit Committee Annual Stipends shall be reduced by 25% for each Non-Employee
Director who fails to attend at least 75% of the total meetings of the Board
and Committees of the Board on which such director served during the fiscal
year, such reduction to be applied to payments to be made within 10 days
following the end of the Company’s fiscal year.

Special
Committee Fees

          In
addition to the foregoing amounts, each Non-Employee Director serving on a
Special Committee of the Board shall be paid an annual fee of $10,000 (the
“Special Committee Fees”); provided that the Special Committee meets during the
year. The Special Committee Fees shall be paid in cash in two equal
installments payable, respectively, within 10 days following the end of the
Company’s second fiscal quarter and within 10 days following the end of the
Company’s fiscal year.

Restricted Stock Unit Awards

          On
the first business day of each fiscal year of the Company, each Non-Employee
Director who is then a member of the Board shall be granted that number of
Restricted Stock Units (the “Deferred Units”) equal to (1) $140,000 divided by
the Fair Market Value of a Share on such date, multiplied by (2) the Pro-Ration
Factor. For each Non-Employee Director, the Pro-Ration Factor means (1) in the
case of a Non-Employee Director who was a Non-Employee Director for the entire
preceding fiscal year and (x) attended at least 75 percent of the regular and
special meetings of the Board and the committees of the Board, during such fiscal
year, on which the Non-Employee Director serves (the “Meetings”), 100% or (y)
did not attend at least 75% of the Meetings, 75%; and (2) in the case of a
Non-Employee Director who was a Non-Employee Director for a portion of such
fiscal year and (x) attended 75% of the Meetings occurring during such portion
of the fiscal year (the “Applicable Meetings”), a percentage determined by
dividing the number of days during such fiscal year that such Non-Employee
Director served as a Non-Employee Director by the total number of days in such
fiscal year or (y) did not attend 75% of the Applicable Meetings, the product
of (A) the fraction determined pursuant to provision (2)(x) of this sentence
and (B) 75%. Each Non-Employee Director who retires prior to the last day of
each fiscal year shall be granted a number of Deferred Units equal to (1) the
Annual Retainer paid during such year divided by the Fair Market Value of a
Share on such Non-Employee Director’s retirement date, multiplied by (2) the
Pro-Ration Factor. In addition, each Non-Employee Director shall subsequently
be granted additional Restricted Stock Units reflecting deemed reinvestment of
any amounts that would have been paid in cash dividends with respect to the
Deferred Units.

          The
Award Agreement in respect of the Deferred Units shall provide that the
Deferred Units shall be immediately vested; provided, however, that Deferred Units
awarded to a Non-Employee Director initially appointed by the Board shall not
vest unless, and until such time as, such director shall have been elected to
the Board by the shareholders of the Company. The Award Agreement shall further
provide that the Deferred Units shall be settled in Shares, and that such
settlement shall be governed by any election previously made by the grantee
Non-Employee Director in respect of the deferred stock unit account established
pursuant to the Medtronic, Inc. 1998 Outside Director Stock Compensation Plan
(the “Deferred Account”), unless and until such election is changed in accordance
with procedures established by the Committee.

          If
no such election in respect of the Deferred Account has been made, or no such
Deferred Account for the grantee Non-Employee Director exists, the Non-Employee
Director shall be provided the opportunity to elect whether the Deferred Units
will be settled in a single lump sum or in five annual installments; provided,
however, that any such election shall not be effective unless made
on or before December 31 of the calendar year before the calendar year in
respect of which such Deferred Units are granted. In the event that no election
has been or may be made in respect of the Deferred Units for any Non-Employee
Director, the Award Agreement shall provide that the Deferred Units shall be
settled in a lump sum of Shares on the date on which the Non-Employee Director
ceases for any reason to be a member of the Board. In all other respects, the
grant, settlement, and vesting of the Restricted Stock Units shall be governed
by the terms of the applicable Award Agreement and the Incentive Plan.

Removal for
Cause

          In
the event that a Non-Employee Director is removed from the Board for Cause
before a Change of Control(a
“Removed Director”): (1) all Options granted to the Removed Director pursuant
to an Annual Option Award or Initial Option Award shall immediately expire and
be forfeited and (2) unless the Board or Committee determines in connection
with or after such removal to forfeit Deferred Units granted to the Removed
Director, such Deferred Units shall be settled pursuant to the Removed
Director’s valid elections with respect thereto or, if no such election exists,
in a lump sum of Shares on the date on which the Removed Director ceases to be
a member of the Board. In addition, if the Removed Director has received or
been entitled to delivery of Shares within six months before the date of
removal, the Board or the Committee, in its sole discretion, may require the
Removed Director to return or forfeit all or a portion of such Shares and
receive back any exercise price paid therefor, or may require the Removed
Director to pay the Company the value of such Shares less any exercise price
paid therefor, determined as of the date of the exercise or delivery of the
Award, as the case may be, in the event that the Board or the Committee, in its
sole discretion, determines that, whether before or after removal the Removed
Director (1) engaged in competition with the Company or any Affiliate, (2)
disclosed, without authorization, material proprietary information of the
Company or any Affiliate, (3) violated applicable business ethics policies or
business policies of the Company or any Affiliate or (4) engaged in any conduct
that the Board, in its sole discretion, determines to warrant such return or
forfeiture. The Board’s or the Committee’s right to require such return or
forfeiture must be exercised within 90 days after the later of (1) the date of
removal or (2) the discovery of an occurrence described in provisions (1)
through (4) of the previous sentence, but in no event later than 15 months
after the date of removal.

Share Retention

          Shares
received pursuant to Annual Option Awards, Initial Option Awards and Deferred
Units shall be subject to the Company’s Officer and Director Stock Retention
Guidelines.Exhibit 10.54

	
 

	
 

	

	
Medtronic, Inc.
710 Medtronic Parkway

Minneapolis, MN 55432-5604 USA

www.medtronic.com

	
 

	
 

	
 

	
tel
763.505.3032

	
 

	
fax
763.505.0220

William
A. Hawkins

Chairman
and Chief Executive Officer

July
27, 2009

D.
Cameron Findlay

656 Sheridan Road

Winnetka, IL 60093

Dear
Cam:

It
is with great pleasure that I confirm our revised offer to you to become a
member of Medtronic’s senior management team. Based upon the discussions and
agreements that have been reached, the following are the terms of our offer of
employment to you:

	
 

	
 

	
1.

	
Title

	
 

	
 

	
 

	
Senior
Vice-President, General Counsel and Corporate Secretary, Medtronic, Inc.

	
 

	
 

	
 

	
In
this role, you will serve as a member of the Medtronic Executive Committee,
reporting to me.

	
 

	
 

	
2.

	
Employment
Location

	
 

	
 

	
 

	
Your
assignment with Medtronic will be located at our World headquarters in
Minneapolis, Minnesota. Until the summer of 2010 you will either commute
between Chicago and Minneapolis or office from our Chicago sales office.

	
 

	
 

	
3.

	
Employment
Date

	
 

	
 

	
 

	
Your
employment with Medtronic will commence August 24, 2009

	
 

	
 

	
4.

	
Base
Salary

	
 

	
 

	
 

	
Your
base salary will be $575,000 per year (less applicable withholdings and
deductions) commencing upon employment and paid in accordance with
Medtronic’s standard payroll practices.

	
 

	
 

	
5.

	
Medtronic
Incentive Plan (“MIP”)

	
 

	
 

	
 

	
You
will be eligible to participate in the FY2010 Medtronic Incentive Plan
(“MIP”), pro rata from your start date, with a target payout of 75% of
eligible earnings. The performance period for the plan commenced on April 25,
2009 and ends on April 30, 2010. In the future, you will remain
eligible to participate in MIP subject to the terms and conditions of those
plans.

D.
Cameron Findlay

Page 2

July 27, 2009

	
 

	
 

	
6.

	
Long-Term
Performance Plan (“LTPP”)

	
 

	
 

	
 

	
You
will be eligible to participate in the 2010 - 2012 phase of the three-year
Long-Term Performance Plan (“LTPP”) with a target award of $400,000 pro-rata
from your start date (subject to the terms and conditions of the LTPP). This
phase commenced on April 25, 2009 and ends April 27, 2012. The actual payout
is based on financial performance as measured by three-year cumulative
diluted EPS, three-year average Return on Invested Capital, and three-year
average revenue growth as specified in the Plan document. You will also be
eligible to participate in subsequent 3-year phases that commence in
succeeding fiscal years, to the extent such plans are implemented and subject
to the terms and conditions of the LTPP plan document.

	
 

	
 

	
7.

	
Nonqualified
Stock Option Grant

	
 

	
 

	
 

	
You
will be eligible for annual stock option awards currently granted on the
first business day of the second quarter of each fiscal year beginning in
fiscal year 2011. The current target grant (aggregate exercise price) is
approximately $1,600,000 and vests 25% per year beginning one year after the
date of grant. All terms and conditions of any stock option awards will be
described in the then-current form of stock option agreement.

	
 

	
 

	
8.

	
Performance-Based
Restricted Stock Unit Grant

	
 

	
 

	
 

	
You
will be eligible for annual grants of performance-based restricted stock
units currently granted on the first business day of the second quarter of
each fiscal year beginning in fiscal year 2011. The current grant target is
$400,000 and vests 100% on the third anniversary of the date of grant
provided that the minimum company performance threshold is met as specified
in the agreement. All terms and conditions of any restricted stock unit
awards will be described in the then-current form of restricted stock unit agreement.

	
 

	
 

	
9.

	
Special
Stock Option Grant

	
 

	
 

	
 

	
To
provide you with significant opportunity to share in the future success of
the Company, you will be granted a one-time, non-qualified stock option award
with an aggregate exercise price of approximately $1,600,000. This award will
vest 25% per year beginning one year after the date of grant. The option
award will be granted on the business first day of the fiscal quarter
following your date of employment and subject to approval by the Compensation
Committee of the Board of Directors. All terms and conditions of any
restricted stock awards will be described in the then current form of stock
option agreement.

	
 

	
 

	
D.
Cameron Findlay

Page 3
July 28, 2009 

	

	
 

	
 

	
10.

	
Special
Restricted Stock Unit Grant

	
 

	
 

	
 

	
As
a further inducement to join Medtronic, you will be granted a one-time
restricted stock unit award of $750,000. This award will vest 100% on the
fourth anniversary of the date of grant. The award will be granted on the
first business day of the fiscal quarter following your date of employment
and subject to approval by the Compensation Committee of the Board of
Directors. All terms and conditions of any restricted stock unit awards will
be described in the then-current form of restricted stock unit agreement.

	
 

	
 

	
11.

	
Two-Year
Transition Bonus – Cash

	
 

	
 

	
 

	
To
bridge you until the first payout of the LTPP in June 2012, you will be
granted a $800,000 cash bonus, payable in 2 installments; $400,000 after 12
months of employment and $400,000 after 24 months of employment. Payment of
this bonus requires the successful completion of objectives that you and I
will jointly define.

	
 

	
 

	
12.

	
Employee
Benefits

	
 

	
 

	
 

	
You
will be offered the same benefits as all other employees of Medtronic upon
meeting eligibility requirements as provided for in the Plan documents. In
addition, you will be eligible for 4 weeks of vacation.

	
 

	
 

	
13.

	
Business
Allowance

	
 

	
 

	
 

	
In
order to defray the cost of an automobile, tax preparation and financial
planning, or other related expenses, you will be provided with an annual
allowance of $24,000 (paid bi-weekly). In addition, you will be provided with
a periodic medical examination under the Company’s Executive Physical
Examination program.

	
 

	
 

	
14.

	
Relocation

	
 

	
 

	
 

	
Costs
associated with your move to Minneapolis will be provided consistent with
Medtronic’s relocation program. Medtronic will seek to minimize or offset
loss on sale of personal residence or other major relocation expenses.

	
 

	
 

	
15.

	
Deferred
Compensation Plan

	
 

	
 

	
 

	
You
will be eligible to participate in the next phase of Medtronic’s Capital
Accumulation Plan (“CAP”), subject to the terms of the CAP, which will
provide for deferral of calendar 2010 compensation. Enrollment for the 2010
CAP will occur in the fall of 2009.

D.
Cameron Findlay

Page 4

July 27, 2009

	
 

	
 

	
16.

	
Severance

	
 

	
 

	
 

	
In
the event you are terminated without cause during FY10, Medtronic shall pay
you an amount (the “Severance Amount”) equal to 1.5 times your annual base
salary provided you sign Medtronic’s standard Separation Agreement and
Release.

	
 

	
 

	
 

	
Beginning
with FY11, in the event you are terminated without cause, Medtronic shall pay
you an amount (the “Severance Amount”) equal to 1.0 times your annual base
salary.

	
 

	
 

	
 

	
Notwithstanding
the language in this Section 16, this language will not apply in the event of
a “change of control” of Medtronic. Under these circumstances, the Employment
Agreement referenced in Section 18, below, shall be controlling.

	
 

	
 

	
17.

	
Confidential
Information

	
 

	
 

	
 

	
Following
your acceptance of this offer of employment, you may be provided with
Confidential Information relating to Medtronic’s business that (a) derives
independent economic value from not being generally known or readily
ascertainable by proper means, by other persons who can obtain economic value
from its disclosure or use, and (b) which Medtronic has treated or designated
as secret, proprietary, or confidential.

	
 

	
 

	
 

	
By
your acceptance of this offer, and for good and valuable consideration
provided by Medtronic, you agree to treat all Confidential Information
entrusted to you by Medtronic as a fiduciary and accept and undertake all of
the obligations of a fiduciary to maintain and protect Confidential
Information for the benefit of Medtronic. You further agree not to directly
or indirectly use or disclose any Confidential Information to or for the
benefit of anyone other than Medtronic, either before, during, or after
employment, for as long as the information retains the characteristics
described in this Section 17.

	
 

	
 

	
18.

	
Employee
Agreement

	
 

	
 

	
 

	
As
a condition of this offer of employment with Medtronic and as a condition of
receiving the benefits identified herein, you must sign the standard Employee
Agreement and the Employment Agreement, which provides for compensation in
the event of certain changes in control. A copy of this these agreements are
attached for your review. You must sign and return the agreements no later
than your first day of employment with Medtronic.

D.
Cameron Findlay

Page 5

July
27, 2009

	
 

	
 

	
19.

	
Protection
of Former Employer

	
 

	
 

	
 

	
With
regard to any employment agreements you may have with current or past
employers, please be advised that Medtronic’s corporate policy prohibits an
employee’s use or disclosure of a former employer’s trade secrets and/or
confidential information. You are encouraged to discuss any questions about
this with us prior to your first day of employment.

	
 

	
 

	
20.

	
Eligibility
Documents

	
 

	
 

	
 

	
Completion
of background verification is a condition of your employment with Medtronic.
In addition, you must comply with the federal regulations regarding
completion of the U.S. Department of Homeland Security I-9 Employment
Eligibility Form. The regulations require that you bring original
identification documents as outlined on side two of the enclosed Employment Eligibility
form. This form must be completed and signed by you in the presence of a
Medtronic representative on your first day of employment. The Medtronic
representative will then review your documentation and complete section two
of the form. Failure to produce the required documentation within 72 hours
(unless a government authorized extension applies) will result in suspension
of employment, without continuation of pay, until these records are provided.

	
 

	
 

	
21.

	
Substance
Abuse Testing

	
 

	
 

	
 

	
A
condition of your employment at Medtronic is the successful completion of a
drug screening test. A screening will be arranged on your next visit to
Minneapolis if possible. If you do not take the test, our offer will be
rescinded. If you do not pass the test, you will receive a letter from our
medical review officer providing you with the opportunity to explain the
positive test result or to ask for a retest of the same sample at your
expense.

D.
Cameron Findlay

Page 6

July 27, 2009

	
 

	
 

	
22.

	
Mandatory
Ethics and Compliance Training

	
 

	
 

	
 

	
As
a further condition of your employment with Medtronic, you will be required
to complete general ethics and compliance training, including a certification
related to our code of conduct within 30 days of your acceptance of this
offer. Please note that it is your responsibility to make sure that you
complete this training. If you fail to complete the training within 30 days,
we will terminate your employment with Medtronic.

Should
you have any questions regarding the terms of this offer, please contact Martha
Goldberg Aronson, Scott Sherman or me. Also, after you have reviewed the terms
of this letter, please indicate your acceptance by signing one copy in the
space provided below and returning it to me in the provided envelope. Nothing in
this offer letter should be construed as guaranteeing employment with Medtronic
for any specific duration. We look forward to your early response.

We
all believe that you can make a major contribution to Medtronic’s future. In
addition, I am sure that you will find Medtronic an extremely rewarding place
to continue your career. I look forward to welcoming you to Medtronic.

Best
regards,

William
A. Hawkins

	
 

	
 

	
Encl.:

	
Medtronic
Employee Agreement

	
 

	
Medtronic
Employment Agreement

	
 

	
New
Hire Employment Document Package

	
 

	
 

	
 

	

	
 

	
        7/28/09

	
D. Cameron Findlay

	
 

	
Date

August 4, 2009

D. Cameron Findlay

656 Sheridan Road

Winnetka, IL 60093

Dear Cam:

Welcome
to Medtronic. We are excited to have you join us as Senior Vice President and
General Counsel in our challenging and rewarding work to alleviate pain,
restore health, and extend life.

The
purpose of this letter is to amend your official start date from August 24,
2009 to Tuesday, August 4, 2009. We have agreed to advance your start date in
order to allow you to become adequately grounded in key matters. To that end,
Medtronic will provide you with certain confidential and proprietary business
information. As Medtronic’s General Counsel, you will provide legal advice as
requested or required. This information and any communication with Medtronic
attorneys around this information is and will remain privileged, consistent
with your role as Medtronic’s chief legal officer.

Please
indicate your agreement to this amended start date by signing below. Please
return this letter to Martha Goldberg Aronson, Senior Vice President, Chief
Talent Officer, 710 Medtronic Parkway, LC400, Minneapolis, MN 55432, who will
provide an updated offer letter shortly.

Sincerely.

	
 

	

	
William A. Hawkins

	
Chairman and Chief
Executive Officer

Agreed to this 4 day of
August, 2009

by D. Cameron Findlay.

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