JOHNSON & JOHNSON
For the period ended Mar 12, 2025. Filed Mar 12, 2025.
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Mar 12, 2025 · Filed Mar 12, 2025
Contents
2024 Potential payments upon termination
We pay earned and unpaid compensation to our employees upon termination. In addition, depending upon the circumstances of the termination and the employee’s age and years of service, we pay severance, provide continued health benefit coverage and provide continued vesting in equity incentives. We have no change-in-control benefits.
Earned but unpaid compensation. Upon any termination of employment as of year-end 2024, employees would receive their 2024 annual incentive and vested non-qualified deferred compensation. They would also be entitled to their pension benefits upon retirement. If a named executive officer had terminated as of year-end 2024, he or she would have received his or her:
Earned but unpaid annual incentives for 2024. An employee must be employed through the end of the year to be eligible for a non-prorated annual incentive payout. However, in case of involuntary termination for cause, these amounts would be forfeited. See non-equity incentive plan compensation in the table on page 91 for the annual incentive amounts.
Vested non-qualified deferred compensation balances. See non-qualified deferred compensation — aggregate balance at last fiscal year-end (column F) in the table on page 105 for the year-end balances.
Pension benefits upon retirement. See 2024 pension benefits on page 102 for details.
Severance, healthcare coverage and equity incentives. In the table on page 108, we show the value of cash severance, continued healthcare coverage and continued vesting in equity incentives as if the named executive officers had terminated as of year-end 2024 under the circumstances shown below. For a complete understanding of the table please read the descriptions of the types of payments that follow the table.
No change-in-control benefits. We do not have any change-in-control agreements or arrangements in place for any of our named executive officers. Our 2022 Long-Term Incentive Plan only provides for a change-in-control benefit in the event that outstanding awards granted under the plan are not assumed or substituted by the acquirer in connection with a change-in-control. If that is the case, the awards will vest and any performance conditions will be deemed to be achieved at the greater of target or actual performance levels as of the date of the change-in-control. If outstanding awards are assumed or substituted, the awards will remain outstanding and will continue to vest following the change-in-control.
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| Name | Type of payment | Voluntarytermination($) | Involuntaryterminationwithoutcause($) | Involuntaryterminationwith cause($) | Death($) | Disability($) |
|---|---|---|---|---|---|---|
| J. Duato | Cash severance | $0 | $2,153,846 | $0 | $0 | $0 |
| Healthcare coverage | 123,000 | 128,000 | 123,000 | 65,000 | 131,000 | |
| Equity incentives | 20,329,773 | 20,329,773 | 0 | 20,329,773 | 20,329,773 | |
| Total | 20,452,773 | 22,611,619 | 123,000 | 20,394,773 | 20,460,773 | |
| J. Wolk | Cash severance | 0 | 1,220,000 | 0 | 0 | 0 |
| Healthcare coverage | 185,000 | 191,000 | 185,000 | 97,000 | 224,000 | |
| Equity incentives | 11,606,321 | 11,606,321 | 0 | 11,606,321 | 11,606,321 | |
| Total | 11,791,321 | 13,017,321 | 185,000 | 11,703,321 | 11,830,321 | |
| T. Schmid | Cash severance | 0 | 1,073,077 | 0 | 0 | 0 |
| Healthcare coverage | 237,000 | 241,000 | 237,000 | 122,000 | 275,000 | |
| Equity incentives | 3,570,985 | 3,570,985 | 0 | 3,570,985 | 3,570,985 | |
| Total | 3,807,985 | 4,885,062 | 237,000 | 3,692,985 | 3,845,985 | |
| J. Taubert | Cash severance | 0 | 1,200,000 | 0 | 0 | 0 |
| Healthcare coverage | 141,000 | 147,000 | 141,000 | 75,000 | 165,000 | |
| Equity incentives | 9,613,769 | 9,613,769 | 0 | 9,613,769 | 9,613,769 | |
| Total | 9,754,769 | 10,960,769 | 141,000 | 9,688,769 | 9,778,769 | |
| J. Reed | Cash severance | 0 | 1,200,000 | 0 | 0 | 0 |
| Healthcare coverage | 0 | 20,000 | 0 | 11,000 | 33,000 | |
| Equity incentives | 3,035,316 | 3,035,316 | 0 | 10,361,792 | 10,361,792 | |
| Total | 3,035,316 | 4,255,316 | 0 | 10,372,792 | 10,394,792 |
Terminations due to a reduction in force or specified divestiture
Our unvested outstanding PSUs and our options and RSUs granted prior to February 13, 2023 are subject to special provisions in the event of a termination due to a reduction in force (RIF) or specified divestiture (as detailed on page 81). As of December 29, 2024, each named executive officer was eligible for qualifying separation treatment of their long-term incentives. For these executives:
Termination due to a RIF would result in amounts equal to those in the involuntary termination without cause column of the potential payments upon termination table above.
Termination due to a specified divestiture would result in amounts equal to those in the involuntary termination without cause column, except they would not receive severance.
108
Cash severance
Our severance pay plan provides benefits to certain full-time U.S. employees who are involuntarily terminated. We provide two weeks base salary for each year of service, with guaranteed minimums based on an employee’s level. The minimum for our named executive officers is 52 weeks of base salary. We pay severance according to our normal payroll cycle. We do not pay severance as a lump-sum payment.
In order to receive the full number of weeks of base salary under our severance pay plan, U.S. employees must sign a release agreement and comply with the conditions set forth in the agreement, which may include compliance with non-competition provisions, release of all claims and rights, and any other terms set forth in the agreement. If U.S. employees do not sign the release agreement, the severance amount is four weeks of base salary.
In the table below, we show how the cash severance amounts in the table on page 108 were calculated.
| Name · Salary rate asof year-end($) · Years ofeligible service(#) · Weeks of base salary continuation · Total amount of cashseverance($) | ||||||
|---|---|---|---|---|---|---|
| Accrued(#) · Minimum(#) · Final(#) | ||||||
| J. Duato | $1,600,000 | 35 | 70 | 52 | 70 | $2,153,846 |
| J. Wolk | 1,220,000 | 26 | 52 | 52 | 52 | 1,220,000 |
| T. Schmid | 900,000 | 31 | 62 | 52 | 62 | 1,073,077 |
| J. Taubert | 1,200,000 | 19 | 38 | 52 | 52 | 1,200,000 |
| J. Reed | 1,200,000 | 1 | 2 | 52 | 52 | 1,200,000 |
Healthcare coverage
Upon termination of employment, all non-union U.S. employees receive continued healthcare coverage that varies based upon the termination circumstances. The healthcare coverage amounts in the table on page 108 are the present values of continued healthcare coverage. The values vary based upon the termination circumstances as follows:
| Healthcare coverage | Eligibility | Eligible named executive officers | Voluntarytermination | Involuntaryterminationwithout cause | Involuntary terminationwith cause | Death | Disability |
|---|---|---|---|---|---|---|---|
| Retiree | Employees age 55 with ten years of service. | DuatoWolkTaubertSchmid | Begins at the end of the cash severance period. | Coverage for dependents | |||
| Separation | Employees between ages 50 and 54 with ten years of service who are involuntarily terminated without cause. | Not applicable | Begins at the earlier of the cash severance period or 52 weeks and ends at age 65. | Not applicable | Not applicable | Not applicable | |
| Active-employee | All employees. | Reed | No continued coverage | While on severance - up to 52 weeks. | Nocontinuedcoverage | Coverage for dependents for 6 months. | While on long-term disability. |
Note: "" means eligible for coverage.
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Equity incentives
The equity incentives amounts in the table on page 108 are the value of unvested equity incentives as of year-end 2023. The values vary based upon the termination circumstances as described under Long-term incentive vesting and treatment upon termination on page 79.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.