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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) November 17, 2006
VARIAN MEDICAL SYSTEMS, INC.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 1-7598 94-2359345
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(State or Other Jurisdiction (Commission File (IRS Employer
of Incorporation) Number) Identification No.)
3100 Hansen Way, Palo Alto, CA 94304-1030
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (650) 493-4000
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers.
On November 17, 2006 the Board of Directors of Varian Medical Systems, Inc.
(the "Company") approved and the Company entered into new change in control
agreements with 12 of its senior executives and key employees, including Timothy
E. Guertin, its Corporate President and Chief Executive Officer (the "CEO");
Elisha W. Finney, its Corporate Senior Vice President, Finance and Chief
Financial Officer; John W. Kuo, its Corporate Vice President, General Counsel
and Corporate Secretary; Robert H. Kluge, its Corporate Vice President and
President, X-ray Products; and Dow R. Wilson, its Corporate Executive Vice
President and President, Oncology Systems. These new agreements replace and
supersede in their entirety as of November 17, 2006 all then-existing change in
control agreements.
Under the new agreements, the Company will pay any of these individuals who
are terminated other than for death, "disability," "retirement," or "cause" or
who resign due to "good reason" (as each of those terms are defined in the new
agreements) within 18 months after a change in control (as defined in the new
agreements), a lump sum severance amount equal to 3.0 (in the case of the CEO),
2.5 (in the case of the Company's other named executive officers and Mr. Kuo) or
2.0 (in the case of other key employees) times the sum of the individual's
then-current annual base salary, plus the greater of (a) the individual's most
recently established target annual bonus or (b) the average annual bonus that
was paid to the individual in the three fiscal years (or lesser number of full
fiscal years completed by the individual) ending before the termination date.
The termination payments and benefits under the new agreements may also be
triggered under certain circumstances following a potential change in control
(as defined in the new agreements), as determined under the new agreements.
In addition, under the new agreements, if an individual is terminated under
the circumstances described above, then unvested stock options will become
immediately exercisable and restrictions on restricted stock will be released as
of the individual's termination date. In addition, the Company will continue
certain insurance and other benefits of the individual under the then-existing
terms for up to 24 months (or, if earlier, the start of full-time employment
with a new employer), pay the individual a lump sum pro-rata bonus at target for
the applicable performance period(s) in which the termination occurs, and
provide the individual an election to purchase the automobile leased by the
Company for the individual, if any.
The new agreements also provide for certain death and long-term disability
benefits in the event of an individual's death or disability within 18 months
after a change in control.
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If any payments or benefits (including those under these new agreements)
result in the imposition of an excise tax as a result of the payments and
benefits exceeding the limits imposed by Section 280G of the Internal Revenue
Code of 1986, as amended (the "Code"), then the individual will receive a tax
restoration payment in an amount that will place the individual in the same
after-tax economic position that the individual would have been in but for the
imposition of the excise tax. The preceding sentence will not apply, however, if
the amount of the payments and benefits received by the individual is less than
110% of the amount which would cause the individual to exceed the limits imposed
by section 280G of the Code. In this case, the amount received by the individual
will be reduced so that the aggregate payments and benefits to be received by
the individual will be $1.00 less than the threshold imposed under section 280G.
Prior to the adoption of these new agreements, the individuals with 280G tax
restoration agreements (the named executive officers and Mr. Kuo) were entitled
to receive such payments without regard to the amount by which the individual's
payments and benefits exceeded the limitations imposed by section 280G of the
Code. Further, the other key employees' agreements did not contain any
provisions with respect to these matters.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Varian Medical Systems, Inc.
By: /s/ John W. Kuo
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Name: John W. Kuo
Title: Corporate Vice President,
General Counsel and Secretary
Date: November 22, 2006
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