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endo | 100 Endo Boulevard | Chadds Ford, Pennsylvania 19317 26
• Organization Advancement:
Successfully integrated Qualitest and AMS into Endo, retaining key talent while initiating cross-selling pilots
as initial steps to realize total solutions strategy;
Following the AMS acquisition, completed cost assessment and identified cost-saving opportunities in all
functional areas;
Implemented quality and compliance controls for acquired businesses and new business initiatives;
Enhanced the Company’s leadership capabilities and critical position succession with the completion of
several key executive hires;
Further strengthened the Company’s culture by integrating a set of leadership attributes into talent man-
agement processes; and
Augmented organization capabilities and the leadership talent pipeline through targeted development of
key leaders and the retention of senior talent who joined Endo through acquisitions.
The performance goals are established to be challenging and ambitious, but also realistic enough to be reasonably at-
tainable given a concerted effort on the part of the Company’s NEOs and employees in consideration of conditions and
trends. In the past three years the NEOs achieved performance goals above target, at target or slightly below target lev-
els. For 2011, a 118% incentive pool was achieved and awarded by the Compensation Committee for the NEOs.
The Compensation Committee reviewed the Company’s achievement of the financial and other objectives set forth
above as well as each named executive officer’s contributions and awarded the NEOs the bonus amounts set forth in the
Summary Compensation Table.
See also below under the heading “Post-Termination Benefit” regarding how each named executive officer with an em-
ployment agreement will be entitled to cash incentive compensation as a percentage of salary.
Equity-Based Long-term Incentive (LTI) Compensation
Purpose. The LTI program provides an annual award (and, under certain circumstances, a periodic award) that is perfor-
mance-based. The objective of the program is to align compensation for NEOs over a multi-year period directly with the
interests of shareholders of the Company by motivating and rewarding creation and preservation of long-term share-
holder value. The level of LTI compensation is determined based on an evaluation of competitive factors in conjunction
with total compensation provided to NEOs and the goals of the compensation program described above. Currently, LTI
awards are equity-based and provide for the awarding of stock options, PSUs and restricted stock units (RSUs). The tim-
ing of our equity grants, including stock options, is not coordinated in a manner that intentionally benefits our executive
officers or coincides with the release of material non-public information.
The Company believes that a combination of stock options, PSUs and
RSUs closely equates the value of the benefit received by the recipi-
ent to the accounting expense of the benefit to the Company. The
Company also believes that the resulting blend of options, PSUs and
RSUs will more accurately reflect the pattern of equity-based awards
that prevails in the Data Point Companies and in the external market
generally. For 2012 grants, the targeted LTI mix of options, PSUs and
RSUs for senior management is reflected in the graph to the left.
In determining the annual LTI grants for the NEOs, the Compensation
Committee considered any pre-existing contractual requirements,
market data on total compensation packages, the value of long-term
incentive grants at the Data Point Companies, total shareholder re-
turn, share usage and shareholder dilution and, except in the case of
the award to the President and Chief Executive Officer, the recom-
mendations of the President and Chief Executive Officer.
Performance
Share Units
Restricted
Stock Units
Stock
Options
33%
of total LTI
33%
of total LTI
33%
of total LTI