ADT 2010 Annual Report Download - page 277

TYCO INTERNATIONAL LTD.
NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 24, 2010
(Continued)
11. REMUNERATION OF THE BOARD OF DIRECTORS AND THE GROUP EXECUTIVES FOR
2010
a) Basis of presentation
The following information sets forth the compensation for the years ended September 24, 2010
and September 25, 2009, of the members of Board of Directors (the Board) of the Company and
Group Executives for all of the functions that they have performed for the Company.
Compensation is presented for the year ended September 25, 2009, rather than for the period
since Tyco became a Swiss company because the full financial year presentation is more
meaningful. Compensation of the Board is paid by Tyco International Ltd. Compensation of the
Group Executives is paid by Tyco International Ltd., and the group entities where they are
employed. Compensation is paid as a combination of both U.S. Dollars and Swiss Francs though
the following tables express all remuneration details in U.S. Dollars ($). Further details of
executive compensation can be found in the Executive Compensation section of the Company’s
2010 proxy statement for the 2011 annual general meeting.
b) Remuneration of the Non-Employee Directors
The table below reflects Director compensation for fiscal years 2010 and 2009. Fiscal years 2010
and 2009 compensation for non-employee Directors consisted of an annual retainer of $80,000 and
$80,000, respectively, restricted stock units (‘‘RSUs’’) with a value at grant of approximately
$120,000 and nil for all Directors except Mr. Yost, respectively, and deferred stock units (‘‘DSUs’’)
with a grant value of approximately nil and $120,000, respectively. The lead Director and the Chair
of the Audit Committee for fiscal years 2010 and 2009, received an additional annual fee of
$20,000, respectively, and the Chairs of the Compensation Committee and the Nominating and
Governance Committee for fiscal years 2010 and 2009, each received an additional annual fee of
$15,000, respectively, in recognition of the responsibilities required in these roles. In addition, any
member of a special committee of the Board receives meeting fees in an amount up to $1,500 per
day for each special committee meeting that he or she attends. No such fees were paid in fiscal
2010 or 2009. A Director who is also an employee receives no additional remuneration for services
as a Director.
For fiscal 2010 and for future grants, the Company has changed the date on which it makes its
director equity grant to align the date with the election of Directors at the Company’s Annual
General Meeting in March. Previously, equity grants had been made at the start of the fiscal year.
As a result, the Company made an interim grant of RSUs to continuing directors to compensate
them for six months of service between October 2009 and March 2010. Because Mr. Yost received
his first equity grant in March 2009 and because Mr. Daniels was not a Board member during this
time period, they did not receive this grant.
As a result of U.S. federal tax law changes, the equity component of Director’s annual
remuneration has changed for fiscal 2010. For fiscal 2010, Directors were granted restricted stock
units (‘‘RSUs’’) with one-year vesting terms in lieu of DSUs. For all Directors other than Mr. Yost,
these RSUs were granted on the first day of fiscal 2010 as the equity component of their fiscal
2010 compensation. Mr. Yost was granted RSUs when he joined the Board on March 12, 2009.
The table below reflects compensation for fiscal years 2010 and 2009. In addition, Mr. McDonald,
a former director was paid $17,741 representing a portion of his pro-rated director fee paid in
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