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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Filed by the Registrant  x

Filed by a Party other than the Registrant  ¨

Check the appropriate box:

RESMED INC.

(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

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Dear Stockholder,

We cordially invite you to attend the ResMed Inc. annual stockholders meeting on Thursday, November 14, 2013, at 10:00 a.m. Australian Eastern Daylight Time (Wednesday, November 13, 2013, at 3:00 p.m. US Pacific Time) in ResMed’s Australian corporate office located at 1 Elizabeth Macarthur Drive, Bella Vista New South Wales 2153.

Your vote is important. We are again promoting the use of the internet to provide proxy materials to stockholders, as we believe this is an efficient, cost-effective and environmentally responsible method for facilitating our annual meeting. Please read “VOTING INSTRUCTIONS AND GENERAL INFORMATION – Voting by Attending our Annual Meeting” in the proxy statement.

Very truly yours,

Peter C. Farrell

Executive Chairman of the Board

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Notice of Annual Meeting of Stockholders of ResMed Inc.

By order of the board of directors,

David Pendarvis

Secretary

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Voting Instructions and General Information

Why am I receiving these materials?

You are receiving this proxy statement because the board of directors of ResMed Inc. is soliciting your proxy to vote at our 2013 annual meeting of stockholders and any continuation, postponement or adjournment of the meeting. The meeting is scheduled for Thursday, November 14, 2013, at 10:00 a.m. (Australian Eastern Daylight Time) in our Australian corporate office, located at 1 Elizabeth Macarthur Drive, Bella Vista New South Wales 2153 Australia. If you held shares of our stock on September 16, 2013, we invite you to attend the annual meeting and vote on the proposals described below under the heading “What am I voting on?” But you do not need to attend the annual meeting to vote your shares. Instead, you may vote over the internet, by telephone, or complete, sign, date, and return the enclosed proxy card by mail.

When and where are proxy materials available?

We expect to first make this proxy statement available to our stockholders and our holders of CHESS Units of Foreign Securities on the internet, and to mail notice and access materials on or about October 3, 2013. Our annual report on Form 10-K was filed with the US Securities and Exchange Commission (SEC) on August 13, 2013. You can review it on our website, at www.resmed.com, and at the website where our proxy materials are posted, at www.proxyvote.com and www.investorvote.com.au.

We encourage you to access and review all of the important information contained in the proxy materials before voting.

Voting Instructions

What am I voting on?

There are four proposals scheduled to be voted on at the annual meeting:

How does the board recommend that I vote?

Our board recommends that you vote:

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Who can vote at the annual meeting?

You are entitled to vote or direct the voting of your ResMed shares if you were a stockholder of record, a beneficial owner of shares held in street name, or a holder of Clearing House Electronic Subregister System (CHESS) Units of Foreign Securities, as of 4:00 p.m. (US Eastern Daylight Time), on September 16, 2013, the record date for our annual meeting. As of the record date, there were 141,659,275 shares of ResMed common stock outstanding, excluding treasury shares. Treasury shares will not be voted. Each stockholder has one vote for each share of common stock held as of the record date. As summarized below, there are some distinctions between shares held of record, those owned beneficially in street name, and those held through CHESS Units of Foreign Securities.

What does it mean to be a stockholder of record?

If, on the record date, your shares of common stock were registered directly in your name with our transfer agent, Computershare, then you are a “stockholder of record.” As a stockholder of record, you may vote in person at the annual meeting or vote by proxy. Whether or not you plan to attend the annual meeting, we urge you to vote by the internet, by telephone, or to fill out and return the enclosed proxy card, to ensure your vote is counted.

What does it mean to beneficially own shares in “street name?”

If, on the record date, your shares of common stock were held in an account at a broker, bank, or other financial institution (we will refer to those organizations collectively as a “broker”), then you are the beneficial owner of shares held in “street name,” and these proxy materials are being forwarded to you by your broker. The broker holding your account is considered the stockholder of record for purposes of voting at our annual meeting. As the beneficial owner, you have the right to direct your broker on how to vote the shares in your account. As a beneficial owner, you are invited to attend the annual meeting. However, since you are not a stockholder of record, you may not vote your shares in person at the annual meeting unless you request and obtain a valid proxy from your broker giving you the legal right to vote the shares at the annual meeting, as well as satisfy the annual meeting admission criteria described below.

Under the rules governing brokers, your broker is not permitted to vote on your behalf on any matter to be considered at the annual meeting (other than ratifying our appointment of KPMG) unless you provide specific instructions to the broker as to how to vote. As a result, we encourage you to communicate your voting decisions to your broker before the annual meeting date to ensure that your vote will be counted.

What does it mean to be a holder of CHESS Units of Foreign Securities?

CHESS Units of Foreign Securities are depositary interests issued by ResMed through CHESS, and traded on the Australian Securities Exchange (ASX). The depositary interests are frequently called “CUFS”, or “CDIs.” If you own ResMed CUFS or CDIs, then you are the beneficial owner of one ResMed common share for every ten CUFS or CDIs you own. Legal title is held by CHESS Depositary Nominees Pty Limited. CHESS Depositary Nominees are considered the stockholder of record for purposes of voting at our annual meeting. As the beneficial owner, you have the right to direct CHESS Depositary Nominees on how to vote the shares in your account. As a beneficial owner, you are invited

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to attend the annual meeting. However, since you are not a stockholder of record, you may not vote your shares in person at the annual meeting unless you request and obtain a valid proxy from CHESS Depositary Nominees giving you the legal right to vote the shares at the annual meeting, as well as satisfy the annual meeting admission criteria described below.

You will receive a notice from Computershare that will allow you to deliver your voting instructions over the internet. In addition, you may request paper copies of the proxy statement and voting instructions from Computershare by following the instructions on the notice provided by Computershare.

Under the rules governing CUFS and CDIs, CHESS Depositary Nominees are not permitted to vote on your behalf on any matter to be considered at the annual meeting unless you provide specific instructions to CHESS Depositary Nominees as to how to vote. As a result, we encourage you to communicate your voting decisions to CHESS Depositary Nominees before the annual meeting date to ensure that your vote will be counted.

How do I vote my shares before the annual meeting?

Holders of common stock listed on the New York Stock Exchange (NYSE). If you are a holder of common stock listed on the NYSE, you may vote before the meeting by submitting a proxy. The method of voting by proxy differs (1) depending on whether you are viewing this proxy statement on the internet or receiving a paper copy, and (2) for shares held as a record holder and shares held in “street name.” You may request paper copies of the proxy statement and proxy card by following the instructions on the Notice.

Holders of CHESS Units of Foreign Securities listed on the ASX. If you hold our CHESS Units of Foreign Securities, you will receive a notice from Computershare, which will allow you to make your voting instructions over the internet. In addition, you may request paper copies of the proxy statement and voting instructions from Computershare by following the instructions on the notice provided by Computershare.

Internet voting closes in the US at 11:59 p.m. (US Eastern Time) on November 12, 2013, for shares traded on the NYSE and 10:00 a.m. (Australian Eastern Daylight Time) on November 13, 2013, for holders of CHESS Units of Foreign Securities listed on the ASX.

How do I vote at the annual meeting?

If you attend our annual meeting and wish to vote in person, you may vote your shares in person by requesting a ballot at our annual meeting. You will need to have proof of ownership and valid photo

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identification with you for admission to our annual meeting. Please note, however, that if your shares are held in “street name,” or if you hold CUFS or CDIs and you wish to vote in person, you must bring a legal proxy from the record holder of the shares, which is the broker or other nominee, or CHESS nominee, as applicable, authorizing you to vote at our annual meeting.

How can I revoke my proxy or change my vote?

You may revoke your proxy and change your vote at any time before the proxy is exercised by any of the following methods:

Holders of record

Stock held by brokers, banks and nominees; and CHESS Units of Foreign Securities

What happens if I return the proxy card to ResMed but do not make specific choices?

If you return a signed, dated proxy card to us with a choice specified on a voting matter, we will vote your shares according to your choice. If you return a signed, dated proxy card to us but do not make specific choices, we will vote your shares as follows: (1) FOR each of the two nominees to our board; (2) FOR ratifying our selection of KPMG; (3) FOR approving, on a non-binding, advisory basis, the compensation we paid our named executive officers; and (4) FOR approval of the amendment to the ResMed Inc. 2009 Incentive Award Plan.

What does it mean if I received more than one proxy card?

If you receive more than one proxy card, your shares are registered in more than one name or are registered in different accounts. Please complete, sign and return each proxy card to ensure that all of your shares are voted.

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GENERAL INFORMATION

What are broker non-votes and how are they counted?

If your broker holds your common stock in “street name” and you have not provided your broker with voting instructions, your broker may vote your shares in its discretion on proposals considered “routine” under NYSE rules. The only proposal considered “routine” is the proposal to ratify our auditor selection. If you do not provide direction to your broker with respect to this proposal, your broker may continue to exercise its discretion to vote your shares. The election of directors, the amendment to the ResMed Inc. 2009 Incentive Award Plan, and the advisory vote on executive compensation are not considered “routine”, and brokers do not have discretionary authority to vote on these matters without your direction. You must indicate to your broker how you wish to vote on any non-routine matter with respect to any shares you hold in “street name” or they will be considered a “broker non-vote.”

Broker non-votes will not affect the outcome of the election of our directors or the advisory vote regarding our executive compensation, as these matters are generally determined based on the number of votes cast and broker non-votes are not considered votes cast. Broker non-votes may have an effect on the proposal relating to the amendment of the incentive plan, since broker non-votes do not count as votes cast and this proposal requires at least 50% of the outstanding shares of common stock entitled to vote to be cast.

Your vote is important. We encourage you to submit your proxy, or provide instructions to your brokerage firm, bank or the CHESS nominee, as applicable. This will ensure that your shares are voted at our annual meeting.

How many shares must be present or represented to conduct business at the annual meeting?

A quorum of stockholders is necessary to hold a valid annual meeting. A quorum will be present if a majority of the outstanding shares entitled to vote are represented at our annual meeting. Shares represented by proxies that reflect abstentions or broker non-votes will be counted as shares represented at our annual meeting for purposes of determining a quorum. If there are insufficient votes to constitute a quorum at the time of the annual meeting, we may adjourn the annual meeting to solicit additional proxies.

On the record date we had outstanding 141,659,275 shares of common stock (excluding treasury shares), the holders of which are entitled to one vote per share. Accordingly, an aggregate of 141,659,275 votes may be cast on each matter to be considered at our annual meeting, and at least 70,829,638 shares must be represented at the meeting to have a quorum.

What is the voting requirement to approve each of the proposals?

Proposal 1 – Directors will be elected by a majority of the votes cast in person or by proxy, which means that the number of votes cast “for” a candidate for director must exceed the number of votes cast “against” that candidate. Abstentions and broker non-votes do not count as a vote cast either “for” or “against” and will not affect the outcome of the election.

Under our board’s policy, in uncontested elections, an incumbent director nominee who does not receive the required votes for re-election will continue to serve, but is expected to tender a resignation to the board. The nominating and governance committee, or another duly authorized committee of the board, will decide whether to accept or reject the tendered resignation, generally within 90 days after

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certification of the election results. We will publicly disclose the board’s decision on the tendered resignation and the rationale behind the decision.

Proposal 2 – The proposal to ratify our selection of KPMG LLP as our independent auditors for the fiscal year ending June 30, 2014, requires the affirmative vote of a majority of the aggregate votes cast in person or by proxy. Abstentions will not affect the outcome of this proposal. Brokers generally have discretionary authority to vote on the ratification of our independent auditors, so we do not expect broker non-votes to result from the vote on proposal 2. Any broker non-votes that may result will not affect the outcome of this proposal.

Proposal 3 – The advisory vote to approve our executive compensation (“say on pay” vote) requires the affirmative vote of a majority of shares cast in person or by proxy. Abstentions and broker non-votes will not affect the outcome of this proposal. As an advisory vote, the results of this vote will not be binding on the board or the company. However, the board values the opinions of our stockholders and will consider the outcome of the vote when making future decisions on the compensation of our named executive officers and our executive compensation principles, policies and procedures.

Proposal 4 – Approval of the proposed amendment to the ResMed Inc. 2009 Incentive Award Plan, requires the affirmative vote of a majority of shares cast in person or by proxy, provided that the total votes cast on the proposal represent over 50% of the outstanding shares of common stock entitled to vote on the proposal. Votes “for” and “against” and abstentions count as votes cast, while broker non-votes do not count as votes cast. All outstanding shares, including broker non-votes, count as shares entitled to vote. Thus, the total sum of votes “for,” plus votes “against,” plus abstentions, which are referred to as the “NYSE Votes Cast,” must be greater than 50% of the total outstanding shares of our common stock. Once this requirement is met, the number of votes “for” the proposal must be greater than 50% of the NYSE Votes Cast. The approval of an amendment to an equity plan is a matter on which brokers or other nominees are not empowered to vote without direction from the beneficial owner. Thus, broker non-votes can result from this proposal and make it difficult to satisfy the NYSE Votes Cast requirement. Abstentions have the effect of a vote against the proposal.

Who pays the costs of proxy solicitors?

The cost of soliciting proxies will be borne by us. After the original delivery of the Notice and other proxy soliciting material, further solicitation of proxies may be made by mail, telephone, facsimile, electronic mail, and personal interview by our regular employees, who will not receive additional compensation for the solicitation. We will also request that brokerage firms and other nominees or fiduciaries deliver the Notice and proxy soliciting material to beneficial owners of the stock held in their names, and we will reimburse them for reasonable out-of-pocket expenses they incur.

How can I see a list of stockholders?

Under Delaware law, a list of stockholders entitled to vote at our annual meeting will be available at the meeting and for ten days before our annual meeting in our principal executive office, located at 9001 Spectrum Center Boulevard, San Diego, California, 92123 USA, between the hours of 9:00 a.m. and 4:00 p.m. US Pacific Time.

How will I receive my proxy materials?

We are furnishing proxy materials (proxy statement and annual report on Form 10-K) to our stockholders via the internet, instead of mailing printed copies of proxy materials to each stockholder. Accordingly, we are sending a notice of internet availability of proxy materials (Notice) to our stockholders of record, while brokers and other nominees who hold shares on behalf of beneficial

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owners will be sending their own similar notice if your shares are listed on the NYSE. If you hold our CHESS Units of Foreign Securities listed on the ASX, you will receive your Notice from our ASX share registry, Computershare Limited. If you received the Notice by mail, you will not automatically receive a printed copy of the proxy materials in the mail. Instead, the Notice instructs you on how to access and review this proxy statement, our annual report on Form 10-K, and proxy voting card via the internet. The Notice also instructs you on how you may submit your proxy via the internet.

You can, however, still receive a hard copy of our proxy materials by following the instructions contained in the Notice on how you may request to receive your materials in printed form on a one-time or ongoing basis. Certain stockholders who have previously given us a permanent request to receive a paper copy of our proxy materials will be sent paper copies in the mail.

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Proposals

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Proposal 1: Election of directors

Our bylaws authorize a board of directors with between one and thirteen members, with the exact number to be specified by the board from time to time. Our board has currently authorized eight directors.

The board is divided into three classes. One class is elected every year at our annual meeting for a term of three years. The class of directors whose term expires in 2013 has two current members: Michael Quinn and Richard Sulpizio. Accordingly, two directors are to be elected at this annual meeting, who will hold office until the 2016 annual meeting or until the director’s earlier death, disability, resignation, or removal. Mr. Quinn is not standing for re-election at this annual meeting.

On the nominating and governance committee’s recommendation, our board has nominated Carol Burt and Richard Sulpizio for election and re-election, respectively, as directors at this annual meeting. We are soliciting proxies in favor of these nominees and proxies will be voted for them unless otherwise specified. If Carol Burt or Richard Sulpizio becomes unable or unwilling to serve as director, the proxies will be voted for the election of such other person, if any, as the board designates. Ms. Burt was initially recommended as a potential board member by cSTONE & ASSOCIATES, a search consultant we retained.

Information concerning the nominees for director and the other directors who will continue in office after our annual meeting is set forth below:

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The following biographical information is furnished with regard to our directors (including nominees) as of September 16, 2013.

Nominees for election at our annual meeting to serve for a three-year term expiring at the 2016 annual meeting:

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BOARD RECOMMENDATION

YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH OF THE TWO NOMINEES TO THE BOARD OF DIRECTORS.

Directors continuing in office until our 2014 annual meeting:

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Directors continuing in office until our 2015 annual meeting 

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Dr. Farrell’s son, Michael Farrell, is our chief executive officer and one of our directors.

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Proposal 2: Ratification of selection of KPMG LLP as our independent auditors for fiscal year ending June 2014

The audit committee has appointed the firm of KPMG LLP as our independent auditors for the fiscal year ending June 30, 2014. KPMG has served as our independent auditors since 1994. Neither the firm nor any of its members has any relationship with us or any of our affiliates except in the firm’s capacity as our auditor.

Stockholder ratification of the selection of KPMG LLP as our independent public auditors is not required by our bylaws or otherwise. However, the board is submitting the selection of KPMG LLP to the stockholders for ratification as a matter of corporate practice. If the stockholders fail to ratify the selection, the audit committee will reconsider whether to retain KPMG. Even if the selection is ratified, the audit committee, in its discretion, may direct the appointment of a different independent accounting firm at any time during the year if the audit committee determines that the change would be in our and our stockholders’ best interests.

We expect representatives of KPMG LLP to be present at the meeting. They will be able to make statements if they so desire and to respond to appropriate questions from stockholders.

BOARD RECOMMENDATION

YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” APPROVAL OF THE RATIFICATION OF THE SELECTION OF KPMG LLP AS OUR INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING JUNE 2014.

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Proposal 3: Advisory vote to approve named executive officer compensation

Background

We are providing stockholders with an opportunity to vote to approve, on an advisory basis, the compensation of our named executive officers as disclosed in this proxy statement. This proposal is commonly known as a “Say on Pay” proposal.

In November 2011, our stockholders approved, on an advisory basis, that we conduct this vote annually. Based on that approval, our board decided that it will hold a Say on Pay vote annually, at least until the next required vote on the frequency of an advisory vote. Because the Say on Pay vote is advisory, it does not bind us. But the board’s compensation committee, which consists entirely of independent directors, values our stockholders’ opinions, and will take the results of the Say on Pay vote into account when making future executive compensation decisions.

Summary

We are asking our stockholders to provide advisory approval of the compensation paid to the executive officers we have described in the “Compensation Discussion and Analysis” section of this proxy statement and the related executive compensation tables. Our executive compensation program is designed to:

In 2013, our compensation programs aligned well with our goals and objectives and we continued to implement “best pay” practices and policies.

Overview of fiscal year 2013 – executive summary

Fiscal 2013 financial success.

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Successful implementation of succession plan. Effective as of March 1, 2013, we implemented a chief executive officer succession plan with the appointment of Michael Farrell, our former president – Americas, to serve as our chief executive officer. In conjunction with this appointment, Dr. Peter Farrell, the then-current chairman of the board, president and chief executive officer, was appointed to serve solely as the executive chairman of the board, and Robert Douglas, our then-chief operating officer also assumed the role of president, while James Hollingshead assumed the position of president – Americas. In making these important management changes, the board noted Mr. Farrell’s leadership skills in sales, marketing, business development and commercial strategy, and Mr. Douglas’ expertise and excellent track record of increasing productivity and efficiencies of global operations.

Compensation tied to performance. We believe that our executive officers were instrumental in achieving our positive financial results. We further believe that the compensation paid to our named executive officers for fiscal year 2013 reflects and is tied to their contributions to our success. During 2013, approximately 85% of our chief executive officers’ compensation, and 82% of our other named executive officers’ compensation was at risk and tied to our financial and stock price performance.

The other 50% of the value of our equity awards is granted in the form of either (1) stock options, or (2) restricted stock awards. Commencing in 2013, both the options and RSU awards vest over a three-year period, but the RSU awards are also subject to the performance condition that we achieve 50% of our budgeted net profit in our third and fourth quarters, either individually or combined. We believe this design best balances the competing considerations of pay-for-performance orientation, stockholder alignment, retention, and administrative complexity.

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Last year’s say on pay vote. At our 2012 annual meeting, approximately 81% of our stockholders voted to approve, on an advisory basis, the compensation paid to our executive officers disclosed in last year’s proxy statement. While the compensation committee believes this is a signal of support for our programs, it has taken strides in 2013 to further align the interests of our management with our stockholders and tie our compensation to our performance by introducing long-term performance based units. We believe that the company may have complexities in achieving a high say on pay vote that are not experienced by many of our competitors because of the dual listing of our shares in the US and Australia, as well as the fact that our compensation philosophy is consistent with our US peer companies. The US-based pay philosophy results in executive compensation that is different than the Australian model, with lower salary and higher equity value than our Australian peers. But we believe these arrangements best balance the competing philosophies and are in the best long-term interests of our stockholders because most of our executive officers are in the US, and we compete for talent mostly with companies that pay using US compensation structures.

Recent implementation of emerging best practices. Our compensation committee, assisted by its independent compensation consultant, continuously monitors emerging best executive compensation practices, particularly among our peer companies. In addition, we have continued to use compensation practices that we understand to be consistent with best practices, and do not have practices generally viewed as problematic.

BOARD RECOMMENDATION

The board believes that the information provided above and within the “Compensation Discussion and Analysis” section of this proxy statement demonstrates that our executive compensation program was designed appropriately and is working to ensure that management’s interests are aligned with our stockholders’ interests to support long-term value creation.

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The following resolution will be submitted for a stockholder vote at the annual meeting:

“RESOLVED, that the stockholders of ResMed approve, on an advisory basis, the compensation paid to our named executive officers, as disclosed in the Compensation Discussion and Analysis, compensation tables and narrative discussion of this proxy statement.”

YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” APPROVAL, ON AN ADVISORY BASIS, OF THE EXECUTIVE COMPENSATION OF RESMED’S NAMED EXECUTIVE OFFICERS.

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Proposal 4: Approval of the Amendment to the ResMed Inc. 2009 Incentive Award Plan

We are asking our stockholders to approve an amendment (the “Amendment”) to the ResMed Inc. 2009 Incentive Award Plan, as approved by our stockholders on November 18, 2009 and subsequently amended and approved by our stockholders on November 17, 2011 (the “2009 Plan”). The Amendment would provide for the following changes to the 2009 Plan:

We are also asking our stockholders to approve the 2009 Plan, as amended by the Amendment, to satisfy the stockholder approval requirements of section 162(m) of the US Internal Revenue Code.

On September 12, 2013, based on our compensation committee’s recommendation, our board approved and adopted the Amendment, subject to approval by our stockholders. The Amendment will become effective on its adoption by our board, subject to our stockholders’ approval at our 2013 annual stockholders meeting, except as otherwise provided in this Proposal 4. Unless and until our stockholders approve the Amendment, we will continue to grant awards under the 2009 Plan’s terms and from the shares available for issuance under the 2009 Plan, without regard to the Amendment proposed in this Proposal 4. We will not grant any awards under the changes proposed in this Amendment unless and until our stockholders approve this Proposal 4.

Accordingly, if our stockholders do not approve this Proposal 4, we will not be able to grant performance-based awards tied to the achievement of the additional performance criteria for which we

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are seeking approval. If this Proposal 4 is not approved by our stockholders, we may continue to grant performance-based compensation under the current terms of the 2009 Plan (without regard to the Amendment) within the meaning of section 162(m) of the US Internal Revenue Code, subject to the terms and limitations of the current 2009 Plan until our 2014 annual meeting of stockholders, based on our stockholders’ November 18, 2009 approval of the 2009 Plan, and we expect that, absent stockholder approval of the proposal set forth in this Proposal 4, we will seek stockholder approval of the material terms of the performance goals under the 2009 Plan at the 2014 annual meeting of stockholders.

Stockholder approval of the Amendment is necessary for us to (1) meet the stockholder approval requirements of the NYSE; (2) take tax deductions for certain compensation resulting from awards granted under the 2009 Plan that may be intended to qualify as performance-based compensation under section 162(m) of the Internal Revenue Code; and (3) grant incentive stock options (ISOs) under the 2009 Plan.

Specifically, stockholder approval of the Amendment will constitute approval of the material terms of the performance goals set forth in the 2009 Plan under the stockholder approval requirements of section 162(m) of the Internal Revenue Code, which will enable us to continue to award performance-based compensation within the meaning of section 162(m) through our 2018 annual meeting of stockholders, preserving the deductibility of these awards for federal income tax purposes. In addition, approval of the Amendment will constitute approval under the stockholder approval requirements of section 422 of the US Internal Revenue Code, relating to ISOs.

Introduction

We believe that equity and incentive awards are an important way to attract and retain a talented executive team and align the executives’ interests with our stockholders’ interests. The 2009 Plan was approved by our stockholders in 2009 and currently, without giving effect to the proposed Amendment, authorizes 35,475,000 shares for issuance under the Plan since the Plan’s inception. As of June 30, 2013, there were 10,654,934 shares remaining available for future awards under the 2009 Plan. The Amendment provides for an increase in the authorized and available shares by 8,345,000 shares, less any grants made between June 30, 2013, and the date our stockholders approve the Amendment (counted at the new 2.8-to-1 ratio for full value awards). The Amendment results in an aggregate number of shares authorized for issuance under the Plan since its inception of 43,820,000. After giving effect to the share increase in the Amendment, and presuming no awards are granted between June 30, 2013, and the date of the annual stockholder meeting, there will be no more than 18,999,934 shares available for grant under the Plan.

In deciding to approve the Amendment, our board and compensation committee reviewed reports prepared by Frederic W. Cook & Co., Inc. (FW Cook), our independent compensation consultant, which included an analysis of certain metrics related to the 2009 Plan, as proposed to be amended by the Amendment (the “Amended Plan” or the “incentive plan”), including burn rate, dilution and overhang, and the costs of the incentive plan, including the estimated stockholder value transfer cost. Specifically, our board and compensation committee considered that:

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Stockholder approval of the Amendment will allow us to continue to provide equity awards as part of our compensation program, an important tool for motivating, attracting and retaining talented employees and for creating stockholder value. If we do not increase the shares available for issuance under the 2009 Plan, we would expect to exhaust the share limit under the 2009 Plan by the end of fiscal year 2015, based on historical usage. This would cause us to lose an important compensation tool, and may compel us to increase the cash component of employee compensation because we would need to replace components of compensation previously delivered in equity awards. Replacing equity compensation with cash may lead to a greater cash compensation expense and a decrease in cash flow.

If our stockholders do not approve this Proposal 4, we will seek stockholder approval of the material terms of the performance goals under the 2009 Plan at our 2014 annual meeting of stockholders, so we may continue to grant performance-based compensation within the meaning of section 162(m) of the US Internal Revenue Code. If our stockholders do not approve the performance criteria under the 2009 Plan at our 2014 annual meeting of stockholders, we will lose the tax deduction for grants of performance-based awards to our named executive officers that are intended to qualify as performance-based compensation under section 162(m). Currently, our annual cash incentive program, our PSUs (which typically comprise 50% of the equity value granted to our executives) and our performance-based RSUs are all intended to qualify as performance-based compensation under Section 162(m). Because these awards are key to our executive compensation program, the loss of this tax deduction will put us at a disadvantage and will compromise our executive compensation program.

The compensation committee, which administers the 2009 Plan, recognizes its responsibility to strike a balance between stockholder concerns regarding the potential dilutive effect of equity awards and the ability to attract, retain and reward employees whose contributions are critical to the long-term success of ResMed. The incentive plan reflects a broad range of compensation and governance best practices, including the following key features:

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If our stockholders approve this Proposal 4, their approval will be considered approval of the incentive plan for purposes of sections 162(m) and 422 of the US Internal Revenue Code.

Burn rate and overhang

In administering our equity program, we consider both our “net burn rate” and our “overhang.”

We define “net burn rate” as the number of equity awards granted in the year, net of cancellations and expirations, divided by the sum of the undiluted weighted average shares of our common stock outstanding during the year. The “net burn rate” measures the potential dilutive effect of our annual equity grants. During the previous three fiscal years, we granted the equity awards, and experienced the forfeitures set forth below:

¹Assumes that each RSU and PSU is the ASC 718 cost-equivalent to the number of options.

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We define “overhang” as the equity awards outstanding but not exercised, plus equity awards available to be granted (the “available equity award shares”), divided by the sum of total shares of common stock outstanding equity awards outstanding but not exercised, and available equity award shares. The “overhang” measures the potential dilutive effect of outstanding equity awards and future awards available for grant. Our overhang as of June 30, 2013 was 12.1%.

We believe that our net burn rate and equity overhang (with or without including the shares requested under the Amendment) are reasonable in relation to companies in our industry. Our equity overhang is near the 25th percentile as a percentage of fully-diluted shares. Our net burn rate and equity overhang also reflect a judicious and consistent use of equity for compensation purposes.

The following table summarizes outstanding equity award balances and related information as of June 30, 2013, under the incentive plan:

The principal features of the Amended Plan are summarized below, but the summary is qualified in its entirety by reference to the 2009 Plan, which was filed as an Exhibit to Form 8-K on November 23, 2009, the 2011 amendment, which was filed as Appendix A to our definitive proxy statement on October 4, 2011, and the current Amendment, which is attached to this proxy statement as Appendix A. We encourage you to read the 2009 Plan, the 2011 amendment and the current Amendment carefully.

Purpose of the Incentive Plan

The purpose of the incentive plan is to continue to provide additional incentive for directors, employees and consultants to further our growth, development and financial success by personally benefiting through the ownership of our common stock, or other rights which recognize their growth, development and financial success. Our board also believes that the incentive plan enables us to obtain and retain the services of directors, employees and consultants that are considered essential to our long range success by offering them an opportunity to own stock and other rights that reflect our financial success. The incentive plan is also designed to permit us to make cash and equity-based awards intended to qualify as “performance-based compensation” under section 162(m) of the US Internal Revenue Code.

The 2009 Plan initially became effective on August 21, 2006.

Securities subject to the Incentive Plan

If our stockholders approve this proposal, the maximum aggregate number of shares of our common stock that may be issued or transferred by awards under the incentive plan will be increased by 8,345,000 shares, from 35,475,000 shares to 43,820,000 shares (less awards granted after June 30, 2013, and counted at the new fungible ratio described below). As of June 30, 2013, there were approximately 10,654,934 shares remaining available for future awards under the 2009 plan.

The Amendment provides that effective as of June 30, 2013, the number of shares of our common stock available for grant under the incentive plan will be reduced by (1) 2.8 shares (previously 3.0

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shares) for each one share of our common stock granted subject to any “full value award,” which is any award other than a stock option, SAR or other award for which the holder pays the intrinsic value, and (2) one share for each share of our common stock granted subject to all other awards granted under the incentive plan.

The incentive plan counts shares on a “gross” basis and does not allow the re-grant of shares withheld or surrendered in payment of the exercise price of a stock option or tax withholding obligations of any option or SAR (previously any award). In addition, shares of our common stock subject to a SAR that are not issued in connection with the stock settlement of the SAR and shares of our common stock that we reacquire in the open market or otherwise using cash proceeds from the exercise of a stock option will not be added to the shares that are available for grant under the incentive plan. If any award under the incentive plan is cancelled, terminated, expires, forfeited or settled for cash, any shares subject to the award at that time will be available for future grants under the incentive plan. In addition, in the event that shares are tendered or withheld to satisfy taxes arising from an award (other than an option or SAR those shares will also be available for future grants under the incentive plan. These replenishment provisions will add back one share for each one share subject to a stock option, SAR and other award for which the holder pays the intrinsic value that was granted under the incentive plan that is subsequently terminated, expired, forfeited, lapses or settled for cash. For every share subject to a full value award that expires, lapses, terminates or is forfeited or settled for cash or that is withheld to satisfy tax withholding liabilities after June 30, 2013, 2.8 shares (previously 3.0 shares) will be made available for issuance under the incentive plan. In no event, however, will any shares of common stock again be available for future grants under the incentive plan if that would cause an incentive stock option to fail to qualify as an incentive stock option under section 422 of the US Internal Revenue Code.

Shares issued in assumption of, or in substitution for, outstanding awards of any entity acquired in any form of combination by us or any of our subsidiaries will not be counted against the shares available for issuance under the incentive plan, to the extent permitted by applicable law or any exchange rule. Additionally, available shares under a stockholder-approved plan of an entity acquired by us or any of our subsidiaries (as appropriately adjusted and converted into shares of our common stock to reflect the acquisition transaction) may be used for future awards under the incentive plan and will not be counted against the shares of common stock available for grant under the incentive plan, subject to applicable laws and exchange rules. The payment of dividend equivalents in cash in conjunction with any outstanding awards will not be counted against the shares available for issuance under the incentive plan.

The shares of common stock covered by the incentive plan may be treasury shares, authorized but unissued shares, or shares purchased in the open market. For purposes of the incentive plan, the fair market value of a share of our common stock as of any given date generally will be the closing sales price for a share of our common stock on that date, as quoted on the NYSE or, if there is no closing sales price for our common stock on that date, the closing sales price for a share of our common stock on the last preceding date for which a quotation exists, as reported in The Wall Street Journal or another source the administrator deems reliable. The closing sales price for a share of our common stock on September 13, 2013, was $52.68, as quoted on the NYSE.

Eligibility

Our employees and consultants (and the employees and consultants of our majority-owned subsidiaries) and our non-employee directors are eligible to receive awards under the incentive plan. As of June 30, 2013, there were approximately 4,000 eligible employees and consultants, and eight eligible directors, six of whom are non-employee directors. The administrator determines which employees, consultants and directors will be granted awards. No person is entitled to participate in the incentive plan as a matter of right, nor does participation constitute assurance of continued

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employment or service. Only those employees, non-employee directors and consultants who are selected to receive grants by the administrator may participate in the incentive plan.

Awards under the Incentive Plan

The administrator may grant or issue stock options, SARs, restricted stock, RSUs, deferred stock, dividend equivalents, performance awards and stock payments, or any combination. Each award is set forth in a separate agreement with the person receiving the award and will indicate the type, terms and conditions of the award.

Non-qualified stock options. Non-qualified stock options (NQSOs) will provide for the right to purchase shares of our common stock at a specified price not less than the fair market value for a share of our common stock on the date of grant (except for awards issued in assumption of, or in substitution for, any outstanding awards of any entity acquired in any form of combination by us or any of our subsidiaries), and usually will become exercisable (in the discretion of the administrator) in one or more installments after the grant date, subject to completing the applicable vesting service period or attaining pre-established performance goals. NQSOs may be granted for any term specified by the administrator, but may not exceed seven years.

Incentive stock options. ISOs are designed to comply with US Internal Revenue Code requirements, and will be subject to certain restrictions. For example, ISOs must have an exercise price not less than the fair market value of a share of our common stock on the grant date (except for awards issued in assumption of, or in substitution for, any outstanding awards of any entity acquired in any form of combination by us or any of our subsidiaries), and may only be granted to employees. ISOs, however, may be subsequently modified to disqualify them from treatment as ISOs. ISO treatment may not be available for options that become first exercisable in any calendar year to the extent the value of the underlying shares that are the subject of the option exceeds $100,000, based on the fair market value of the shares on the option grant date. To the extent this limit is exceeded, the options granted will be NQSOs. If we grant an ISO to an individual who owns (or is deemed to own) more than 10% of the total combined voting power of all classes of our stock, the incentive plan requires the ISO’s exercise price to be at least 110% of the fair market value of a share of our common stock on the grant date, and the ISO must not be exercisable until five years after the grant date. Like NQSOs, ISOs usually will become exercisable (in the discretion of the administrator) in one or more installments after the grant date, subject to completing applicable vesting service periods or attaining pre-established performance goals. ISOs may be granted for any term specified by the administrator, but may not exceed seven years.

Stock appreciation rights. SARs provide for the payment of an amount to the holder based on increases in the price of our common stock over a set base price. The base price must be at least 100% of the fair market value of a share of our common stock on the grant date for any SAR we grant under the incentive plan (except for awards we issue in assumption of, or in substitution for, outstanding awards of any entity acquired in any form or combination by us or our subsidiaries). SARs under the incentive plan will be settled in cash or shares of our common stock, or in a combination of both, at the administrator’s election. We may grant SARs granted together with stock options or other awards, or separately. SARs may be granted for any term the administrator specifies, but may not exceed seven years.

Restricted stock. The administrator will determine the price (if any) and restrictions (including time vesting or satisfying performance goals) that apply to restricted stock we issue. If vesting conditions or other restrictions are not met, we may typically repurchase restricted stock at the original purchase price, if any, or restricted stock may be forfeited. In general, restricted stock may not be sold, or otherwise hypothecated or transferred, until the vesting restrictions and other restrictions applicable to the shares

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are removed or expire. Recipients of restricted stock, unlike recipients of options or RSUs, generally will have voting rights and will receive dividends before restrictions lapse.

Deferred stock awards. Deferred stock may not be sold or otherwise hypothecated or transferred until issued. Deferred stock will not be issued until the deferred stock award has vested, and recipients of deferred stock generally will have no voting or dividend rights before vesting conditions are satisfied and the shares are issued. Deferred stock awards generally will be forfeited, and the underlying shares of deferred stock will not be issued, if the applicable vesting conditions and other restrictions are not met.

Restricted stock units. RSUs entitle the holder to receive shares of our common stock, subject to the removal of restrictions which may include completing applicable vesting service periods or attaining pre-established performance goals. We may delay issuing shares of our common stock under RSUs until after the RSUs vest. RSUs may not be sold, or otherwise hypothecated or transferred, and holders of RSUs do not have voting rights. RSUs generally will be forfeited, and the underlying shares of stock will not be issued, if the applicable vesting conditions and other restrictions are not met. Our policy is not to pay dividend equivalents (described below) with respect to restricted stock, restricted stock units, or PSUs that vest or are earned based on performance conditions unless and until the performance conditions have been met and the award vests or is earned.

Dividend equivalents. Dividend equivalents represent the value of the dividends per share paid by us, if any, calculated with reference to a specified number of shares. Dividend equivalent rights may be granted alone or in connection with RSUs, deferred stock or other full value awards granted to the participant under the incentive plan, but may not be granted in connection with stock options or SARs or paid out on any unvested restricted stock units. The administrator may elect to pay dividend equivalents in cash, in shares of our common stock, or in a combination of both. The Amendment requires that dividends or dividend equivalents with respect to an award with performance-based vesting will only be paid out to the holder to the extent that the performance-based vesting conditions are satisfied and the award vests.

Performance awards. Performance awards may be granted by the administrator to employees, consultants or non-employee directors based on, among other things, the contributions, responsibilities and other compensation of the particular recipient. These awards generally will be based on specific performance goals and may be paid in cash or in shares of our common stock, or in a combination of both, at the election of the administrator. Performance awards may include “phantom” stock awards that provide for payments based on the value of our common stock. Performance awards may also include bonuses granted by the administrator, which we may pay in cash, in shares of our common stock, or in a combination of both.

Stock payments. The administrator may authorize stock payments in the form of our common stock or an option or other right to purchase our common stock and may, without limitation, issue them as part of a deferred compensation arrangement in lieu of all or any part of compensation – including, without limitation, salary, bonuses, commissions and directors’ fees – that would otherwise be payable in cash to the employee, non-employee director or consultant.

Section 162(m) “Performance-Based” Awards

The administrator may designate employees as participants whose compensation for a given fiscal year may be subject to the limit on deductible compensation imposed by section 162(m) of the US Internal Revenue Code. The administrator may grant to those designated employees and other eligible persons stock options, SARs, restricted stock, RSUs, deferred stock, dividend equivalents, performance awards, cash bonuses and stock payments that are paid, vest or become exercisable on the achievement of

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specified performance goals which are related to one or more of the following performance criteria, as applicable to us or any subsidiary, division, operating unit, product or individual:

Performance goals established based on the performance criteria may be measured either in absolute terms, or as compared to any incremental increase or decrease, or as compared to one or more other companies’ performance. The administrator may provide at the grant that objectively determinable adjustments will be made for purposes of determining the achievement of one or more of the performance goals established for an award. The incentive plan provides that any adjustments will be based on one or more of the following:

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Achievement of performance goals and any adjustments will be determined in accordance with GAAP to the extent it applies, unless the administrator provides otherwise.

Award limit

The incentive plan provides that the maximum number of shares that may be subject to awards granted under the incentive plan to any individual during any calendar year may not exceed 3,000,000 shares, or 4,500,000 shares in a participant’s initial hiring year, subject to adjustment in the event of any recapitalization, reclassification, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off or other transaction that affects our common stock in a manner that would require adjustment to the limit to prevent the dilution or enlargement of the potential benefits we intended to make available under the incentive plan. Cash-settled performance awards granted in any calendar year may not have an aggregate maximum amount payable in excess of $3,000,000.

Vesting and exercise of awards

The applicable award agreement will state when the right to exercise the award vests. At any time after granting an award, the administrator may accelerate the vesting period, subject to certain limitations. No portion of an award which is not vested at a participant’s termination of service will subsequently become vested, except as the administrator may otherwise provide, either in the agreement relating to the award, or by action after granting the award. There are no minimal vesting requirements for full value awards.

A participant generally may only exercise an option or SAR while the participant remains our employee, director or consultant, or for a specified period of time (up to the remainder of the award term) after the recipient’s termination of service, as the administrator may specify. While continuing service, a participant may exercise any vested portion of an award until the award expires. The grant agreements currently provide that unexercised vested stock options at least 1% in the money will be automatically exercised on the expiration date.

Only whole shares of our common stock may be purchased or issued under an award. Any required payment for the shares subject to an award will be paid in the form of cash or a check payable to us in the amount of the aggregate purchase price. However, the administrator may, in its discretion and subject to applicable laws, allow payment through one or more of the following:

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Transferability of awards

Participants generally may sell, pledge, assign or transfer awards in any manner other than by will or by the laws of descent and distribution or, subject to the consent of the administrator of the incentive plan, under a domestic relations order, unless and until the award has been exercised, or the shares underlying the award have been issued, and all restrictions applicable to shares have lapsed. Notwithstanding the foregoing, a participant may also, with the administrator’s consent, transfer NQSOs to certain family members and trusts. During the holder’s lifetime, only the holder or a permitted transferee may exercise an award.

No repricing

The administrator will not (a) lower the price per share of an option or stock appreciation right after it is granted, (b) cancel an option or stock appreciation right in exchange for cash or another award (other than in connection with a change in control), or (c) take any other action with respect to an option or stock appreciation right that would be treated as a repricing under the rules and regulations of the principal US national securities exchange on which the shares are listed, unless (1) our stockholders approve it, or (2) it occurs in connection with certain equitable adjustments as described in the plan (to prevent the dilution or enlargement of potential benefits in connection with a corporate transaction).

Plan benefits

We cannot currently determine the future benefits that our current directors, executive officers and all eligible employees will receive under the incentive plan, if approved.

Equity award grants under the 2009 Plan

The following table sets forth summary information concerning the number of shares of our common stock subject to options, RSUs and PSUs made under the 2009 Plan since the 2009 Plan’s inception on August 21, 2006 through September 16, 2013:

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Adjustments for stock splits, recapitalizations and mergers

If there is any recapitalization, reclassification, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin off, disposition of all or substantially all of our assets or other similar transaction that affects our common stock, or certain restructurings, the administrator of the incentive plan will make proportionate adjustments to any or all of the:

Change of control

In the event of a “change of control,” as defined in the incentive plan, each outstanding award will be assumed, or substituted for an equivalent award, by the successor corporation. If the successor corporation does not provide for the assumption or substitution of the awards, the administrator may cause all awards to become fully exercisable before the transaction is completed and all forfeiture restrictions on any or all awards to lapse. The administrator may also grant awards under the incentive plan which provide for immediate accelerated vesting on a change of control or the occurrence of a subsequent event, such as the termination of the participant’s employment or service.

Administration of the Incentive Plan

Our board’s compensation committee administers the incentive plan unless our board assumes authority for administration. Our board administers the incentive plan as to awards to non-employee directors. We expect the compensation committee to consist of two or more directors, each of whom is intended to qualify as both a “non-employee director,” as defined in Rule 16b-3 of the Exchange Act, an “outside director” for purposes of section 162(m) of the US Internal Revenue Code, and an “independent director” by NYSE listing standards. Our board or the compensation committee may delegate its authority to grant awards under the incentive plan to a committee consisting of one or more members of the board or compensation committee. Our board also may delegate its authority to grant awards under the incentive plan to a committee consisting of one or more of our officers, but that delegation will not include authority to grant awards to individuals who are subject on the date of grant to the reporting requirements of section 16(a) of the Exchange Act, individuals whose compensation in the year of grant is, or in a future calendar year may be, subject to the limitation on deductibility under section 162(m) of the US Internal Revenue Code or the officers who are delegated authority as a member of that committee.

The administrator has the power to:

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Because we have operations in Australia and other countries outside the United States, the incentive plan also authorizes the administrator to modify the terms and conditions of awards, including adopting one or more subplans, as the administrator deems advisable to ensure compliance with applicable foreign laws and listing standards, provided that the modifications do not violate any other applicable law or require stockholder approval.

Amendment and termination of the Incentive Plan

Our board or the compensation committee may amend the incentive plan at any time, but stockholder approval is required to increase the limits on the number of shares that may be issued, to materially change the eligibility requirements, to decrease the exercise price of any outstanding option or SAR granted under the incentive plan, or to replace any outstanding option or SAR with cash, restricted shares, or any other awards.

Our board or the compensation committee may suspend or terminate the incentive plan at any time. If this proposal is approved by our stockholders, the Amended Plan provides that in no event may an award be granted under the Amended Plan on or after September 11, 2023.

Material US Federal income tax consequences associated with the Incentive Plan

The following is a general summary under current law of the material US federal income tax consequences to participants granted an award under the incentive plan. This summary deals with the general US federal income tax principles that apply and is provided only for general information. Some kinds of taxes, such as state, local and non-US income taxes and employment taxes are not discussed. Tax laws are complex and subject to change and may vary depending on individual circumstances and from locality to locality.

This summary does not discuss all aspects of federal income taxation that may be relevant in light of a holder’s personal circumstances. This summarized tax information is not tax advice and a holder of an award should rely only on the advice of their legal and tax advisors.

Non-qualified stock options. If an optionee is granted a non-qualified stock option under the incentive plan, the optionee should not have taxable income on the grant of the option. The optionee generally should recognize ordinary income at the time of exercise in an amount equal to the fair market value of a share of our common stock at that time, less the exercise price paid. The optionee’s basis in the common stock for purposes of determining gain or loss on a subsequent sale or disposition of the

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shares generally will be the fair market value of our common stock on the date the optionee exercises the option. Any subsequent gain or loss will be taxable as a capital gain or loss.

Incentive stock options. No taxable income should be recognized by the optionee at the time of the grant of an incentive stock option, and no taxable income should be recognized for regular federal income tax purposes at the time the option is exercised; however, the excess of the fair market value of our common stock received over the option price is an “item of adjustment” for alternative minimum tax purposes. The optionee will recognize taxable income in the year in which the purchased shares are sold or otherwise made the subject of a taxable disposition.

For federal income tax purposes, dispositions are divided into two categories: qualifying and disqualifying.

On a qualifying disposition, the optionee should recognize long-term capital gain in an amount equal to the excess of the amount realized on the sale or other disposition of the purchased shares over the exercise price paid for the shares. If there is a disqualifying disposition of the shares, then the optionee should recognize ordinary income on the smaller of the:

Any additional gain or loss recognized on the disposition will be recognized as a capital gain or loss by the optionee.

With respect to our tax obligations, we will not be entitled to any federal income tax deduction if the optionee makes a qualifying disposition of the shares. If the optionee makes a disqualifying disposition of the purchased shares, then generally we or our subsidiary should be entitled to a federal income tax deduction, for the taxable year in which the disposition occurs, equal to the ordinary income recognized by the optionee.

Stock appreciation rights. The recipient of a SAR should generally not recognize taxable income on the grant of the SAR, but, on exercise of the SAR, the cash or the fair market value of the shares received should be taxable as ordinary income.

Restricted stock. In general, a recipient of restricted stock should not be taxed on the grant or purchase of restricted stock that is subject to a “substantial risk of forfeiture” and that is non-transferable within the meaning of section 83 of the US Internal Revenue Code. However, when the restricted stock is no longer subject to the substantial risk of forfeiture (for example, when the restrictions lapse on a vesting date) or the shares become transferable, the recipient should recognize ordinary income equal to the fair market value of the common stock on the date the restrictions lapse or become transferable, less the amount paid, if any, for the restricted stock. A recipient of restricted stock may, however, make an election under section 83(b) of the US Internal Revenue Code to be taxed at the time of the grant or purchase on an amount equal to the fair market value of the common stock on the date of transfer,

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less the amount paid, if any, for the restricted stock. If a timely section 83(b) election is made, the recipient should not recognize any additional income as and when the restrictions applicable to the restricted stock lapses.

Restricted stock units and deferred stock. A recipient of RSUs or a deferred stock award generally should not have ordinary income on grant of RSUs or deferred stock. When the shares of common stock are delivered under the terms of the award, the recipient should recognize ordinary income equal to the fair market value of the shares delivered, less any amount paid for the shares.

Dividend equivalent awards and performance awards. A recipient of a dividend equivalent award or a performance award generally will not recognize taxable income at the time of grant. However, when an award is paid, whether in cash or in shares of common stock, the recipient will recognize ordinary income equal to the value received.

Stock payments. A recipient of a stock payment generally will recognize taxable ordinary income in an amount equal to the fair market value of the shares of common stock received.

Tax deductions and section 162(m) of the US Internal Revenue Code. We or our subsidiaries generally should be entitled to a federal income tax deduction at the time and for the same amount as the recipient recognizes as ordinary income, except as otherwise described above with respect to ISOs, and subject to the limitations of section 162(m) of the US Internal Revenue Code with respect to compensation paid to certain “covered employees.” Under section 162(m), income tax deductions of publicly-held corporations may be limited to the extent total compensation (including base salary, annual bonus, stock option exercises and non-qualified benefits paid) for certain executive officers exceeds $1,000,000 in any one year. The section 162(m) deduction limit, however, does not apply to certain “qualified performance-based compensation” as defined by the US Internal Revenue Code, and established by an independent committee.

In particular, stock options and SARs will satisfy the “qualified performance-based compensation” exception if the awards are made by a qualifying committee, the underlying plan sets the maximum number of shares that can be granted to any person within a specified period and the compensation is based solely on an increase in the stock price after the grant date (that is, the exercise price or base price is not less than the fair market value of the stock subject to the award on the grant date). Other awards granted under the incentive plan may be “qualified performance-based compensation” for purposes of section 162(m), if the awards vest or are paid solely based on the achievement of one or more pre-established, objective performance goals. The incentive plan is structured in a manner that is intended to enable the committee to provide awards that satisfy the requirements for “qualified performance-based compensation” under section 162(m). If the committee determines that it is in our best interest to make use of those awards, the remuneration attributable to those awards should not be subject to the $1,000,000 limitation. We have not, however, requested a ruling from the US Internal Revenue Service or an opinion of counsel regarding this issue. This discussion will neither bind the US Internal Revenue Service nor preclude the US Internal Revenue Service from adopting a contrary position.

Section 409A of the US Internal Revenue Code. Certain awards under the incentive plan may be considered “non-qualified deferred compensation” for purposes of section 409A of the US Internal Revenue Code, which imposes additional requirements on the payment of deferred compensation. Generally, if at any time during a taxable year a non-qualified deferred compensation plan fails to meet the requirements of section 409A, or is not operated in accordance with those requirements, all amounts deferred under the non-qualified deferred compensation plan for the taxable year and all preceding taxable years, by or for any participant with respect to whom the failure relates, are includable in the gross income of the participant for the taxable year to the extent not subject to a

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substantial risk of forfeiture and not previously included in gross income. If a deferred amount is required to be included in income under section 409A, the amount will be subject to income tax at the regular income tax rates plus an additional 20% tax, as well as a potential interest on the tax.

BOARD RECOMMENDATION

YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” APPROVAL OF THE AMENDMENT TO THE 2009 PLAN.

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COMPANY INFORMATION

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Corporate Governance

Board independence

Our board has determined that six of our eight continuing directors, Messrs. Quinn, Pace, Roberts, Sulpizio, Taylor and Wareham, are independent members of our board under the listing standards of the NYSE, and they and their respective family members have no material relationship with us, commercial or otherwise, that would impair the director’s independence. Ms. Burt, our director-nominee, is also independent. The board also determined that each member of the audit, nominating and governance, and compensation committees is independent as required by the applicable listing standards of the NYSE and that each member of the audit committee is independent as required by the applicable laws of the SEC. The board determined that Dr. Peter Farrell and Michael Farrell each have a material relationship with us as an executive officer that prohibits them from being considered independent under applicable standards.

The following specific relationships or transactions were considered by our board in making its independence decisions:

Our board determined that these matters did not prevent Dr. Pace or Dr. Roberts from being considered independent under applicable standards.

Meetings and director attendance

During fiscal year 2013, each director attended 100% of the meetings of our board and of the committees on which the director served. Our board and standing committees met as follows:

Regular board: four meetings;

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Compensation committee: eight meetings;

Audit committee: eight meetings; and

Nominating and governance committee: four meetings.

During each regular meeting, our independent directors met without management present, and our lead director chaired those sessions. In addition to meetings, the members of our board and its committees sometimes take action by written consent in lieu of a meeting, as permitted under Delaware corporate law, or discuss company business without calling a formal meeting.

All directors were present for our 2012 annual stockholders meeting. We encourage directors to attend our annual meetings and generally schedule board meetings to coincide with the annual meeting to facilitate directors’ attendance.

Board oversight of risk

The general risk oversight function is retained by the full board while the standing committees of the board, comprised and chaired by our independent directors, retain primary responsibility for risk identification and analysis in the key areas further defined below. The committees periodically provide updates to the board regarding significant risk management issues and management’s response.

Designated internal management, as well as certified professional accounting firms performing annual internal audits, regularly review and test functions, controls and processes to review, evaluate and recommend mitigation strategies, as may be warranted. Critical areas of focus include financial, operational, regulatory, compliance, economic, compensation, and competition, among others.

Board leadership structure

Dr. Farrell has served as our chairman of the board since 1989, and has concurrently served as our chief executive officer from our founding through January 2008, and from February 2011 through March 2013. In March 2013, Dr. Farrell resigned as chief executive officer, and continued in his role of executive chairman, on the appointment of Michael Farrell as our new chief executive officer. Since March 2013, we have separated the roles of chairman of the board and chief executive officer.

The board continues to believe that having Dr. Farrell serve as the chairman of the board is the most appropriate leadership structure for us and in the best interest of our stockholders. Dr. Farrell is our

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founder, has been our chairman since our founding in 1989, and served as our chief executive officer for over 20 years. Dr. Farrell provides deep institutional knowledge about our organization’s history and operations, the industry, the science underlying the medical conditions we address and the technology we develop. Under his leadership, the board believes we have achieved remarkable success and delivered substantial long-term rewards for our stockholders. Maintaining him in the role as chairman provides leadership continuity.

The board believes the advantages described above outweigh any theoretical risks or disadvantages arising from Dr. Farrell’s role as an executive or from his serving as chairman while his son, Michael Farrell, serves as chief executive officer.

First, the board believes that since March 2013, Dr. Farrell has been uniquely suited to effectively perform the dual roles of providing leadership to the board as chairman, and serving in an officer role as executive chairman, in which he assists in the executive transitions and provides guidance to management, particularly in the areas of long-term strategy, consulting with key opinion leaders in related fields, and maintaining our unique values and culture. In addition, our board and Dr. Farrell intend that he will not serve in his officer role effective January 1, 2014, and will continue to serve as non-executive chairman of the board.

Second, the board believes our leadership structure mitigates any potential risks from the family relationship between Dr. Farrell and Michael Farrell. Six of our eight directors are independent, which provides an independent counterbalance to an executive chairman. The role of independent lead director also provides an additional structure enabling an effective independent board. Our lead director role is filled by our current nominating and governance committee chairman. The primary responsibilities of the lead director are to preside over board meetings in the absence of the chairman, call, establish the agenda for and preside over meetings of the independent directors, act as a liaison between the independent directors and chairman, guide the chairman on board meeting agendas as well as the adequacy of information to be presented, communicate with stockholders as appropriate, and other duties that may be delegated by the board, independent directors, chairman or the nominating and governance committee. Finally, all of the board’s committees are filled entirely by independent directors, providing an opportunity for the board to fulfill its oversight responsibilities.

For the reasons discussed above, our board believes the current leadership structure is in our best interest at this time. However, our corporate governance guidelines give the board the flexibility to change its leadership over time, as needed. The board continues to evaluate whether its leadership structure is appropriate as our business evolves.

Committees of our board of directors

The board has three standing committees to assist in the management of our affairs: compensation, nominating and governance, and audit. A copy of the charters for each of these standing committees can be found on our website at www.resmed.com. In addition, in February 2011, the board formed an ad hoc committee, the chief executive officer succession committee. The board dissolved that committee in March 2013, after completing the chief executive officer succession process. In May 2013, as part of its routine ongoing assessment of its own operating procedures, the board reviewed the existing committee structure and decided to reduce the size of the nominating and governance committee, and rotate the chairs of all committees, effective at the beginning of fiscal year 2014.

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Below is a summary of our committee structure and membership information for fiscal year 2013 and currently.

Compensation committee

The compensation committee currently consists of Richard Sulpizio (chair), Gary Pace, and Ronald Taylor. During fiscal year 2013, Mr. Taylor served as chair, and Messrs. Pace and Sulpizio were members. Each of the compensation committee members has been determined by our board to meet the independence requirements for compensation committee service under the current listing standards of the NYSE and SEC.

The compensation committee’s primary purposes are to:

The compensation committee meets in person and by telephone to perform its duties. It works primarily with our chief administrative officer and global general counsel, our chief human resources officer, and their staff to gather internal data and solicit management’s recommendations regarding compensation. The committee also communicates directly with our chief executive officer, as appropriate, for recommendations

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and information regarding compensation, particularly with regard to the direct reports to the office of the chief executive officer. In addition, the committee consults with our chief financial officer and his staff regarding the financial impact of certain compensation decisions. However, the committee generally determines the compensation for each of our individual officers outside of the presence of the affected officer. The committee also advises and consults with other non-executive board members as it determines appropriate regarding compensation issues.

During fiscal year 2013, the committee retained a nationally-recognized independent consultant, Frederic W. Cook & Co., Inc. The consultant was engaged to render advisory services and to serve as the committee’s independent compensation consultant in connection with compensation-related matters for our executives and board. During fiscal year 2013, these compensation matters included assessing our executive compensation program, including salaries, target and actual bonuses, and long-term incentive equity grants. The consultant also advised the compensation committee regarding board compensation, including board fees and equity grants. The consultant provided the committee with information regarding industry trends, best practices, and regulatory changes. Companies included in the peer group for competitive comparisons were initially proposed by the consultant and approved by the committee. The consultant was engaged directly by the committee. The consultant worked with our chief administrative officer and global general counsel, our chief human resources officer and their staff, but also communicated directly with the committee.

During fiscal year 2013, the committee also considered information provided by management from other third-party consultants we retained, primarily regarding market practices and data concerning the compensation paid in certain non-US countries.

During fiscal year 2013, the committee continued its practice of delegating to our chief executive officer and our chief administrative officer and global general counsel, authority to approve certain equity grants to employees who were not officers whose compensation was approved by the committee, so long as the aggregate total of those equity grants did not exceed committee-established thresholds and were consistent with committee-determined standard terms for grants. During fiscal year 2013, under this authority, this subcommittee granted 37,500 options and 32,523 RSUs. The committee believes this delegation enhances our ability to attract, reward and retain talented employees by allowing management to extend binding employment offers and to act in other special situations quickly and flexibly. All other equity grants (including grants to named executive officers) must be pre-approved by the committee.

Nominating and governance committee

During fiscal year 2013, the nominating and governance committee consisted of all of our independent directors, namely Gary Pace (chair), Michael Quinn, Christopher Roberts, Richard Sulpizio, Ronald Taylor and John Wareham. Beginning in fiscal year 2014, the board reduced the size of the nominating and governance committee, to increase its efficiency, and in the expectation that the March 2013 completion of the chief executive officer succession process would reduce the committee’s workload. The current members are Mr. Taylor (chair), and Messrs. Pace and Wareham.

The nominating and governance committee’s primary purposes are to:

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Our corporate governance guidelines state goals regarding composition of the board and committees, meetings and expectations of directors. A copy of our corporate governance guidelines may be found on our website at www.resmed.com.

The nominating and governance committee is responsible for reviewing with the board, on an annual basis, the appropriate characteristics, skills and experience required for the board as a whole and its individual members. To assist in promoting a diversity of backgrounds and experience on the board, the nominating and governance committee takes reasonable steps to identify and consider board candidates who are drawn from a wide talent pool, representing diversity of thought, culture, gender, ethnicity, race, background and other qualities.

The suitability of individual candidates depends on many factors. Those factors include:

The board evaluates each individual in the context of the board as a whole, with the objective of assembling a group that can best perpetuate the success of the business and represent stockholder interests through the exercise of sound judgment using its diversity of experience in these various areas.

In determining whether to recommend a director for re-election, the nominating and governance committee also considers the director’s past attendance at meetings and participation in and contributions to the board’s activities.

After review and deliberation of all feedback and data, the nominating and governance committee makes its recommendation to our board.

Recommendations we receive from stockholders are subject to the same criteria as are candidates nominated by the nominating and governance committee. The committee will consider stockholder suggestions for nominees for directorship and has a policy to consider any candidate recommended by stockholders who have held a minimum of 1% of our outstanding voting securities for at least one year. A recommending stockholder must submit a detailed resume of the candidate and an explanation of the reasons why the stockholder believes the candidate is qualified for service on our board. The

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stockholder must also provide any other information about the candidate that would be required by US SEC rules to be included in a proxy statement. In addition, the stockholder must include the consent of the candidate (including the consent to a background check) and describe any relationships, arrangements or undertakings between the stockholder and the candidate regarding the nomination or otherwise. The stockholder must submit proof of ownership of our stock.

All communications should be submitted in writing to the chair of the nominating and governance committee, care of Secretary, ResMed Inc., 9001 Spectrum Center Boulevard, San Diego, California 92123 USA. Recommendations received after 120 days before the mailing of the proxy will likely not be considered timely for consideration at that year’s annual meeting.

The nominating and governance committee will consider stockholder recommendations of candidates on the same basis as it considers all other candidates. For further information, see “Stockholder proposals for 2014 annual meeting.”

Audit committee

The audit committee currently consists of John Wareham (chair), and Michael Quinn and Christopher Roberts. During fiscal year 2013, Mr. Quinn served as chair, and Messrs. Roberts and Wareham were members. Each of the audit committee members has been determined by our board to be financially literate and meet the other requirements for audit committee service under the current listing standards of the NYSE and SEC. In addition, our board has identified all members of the audit committee as financial experts according to the SEC’s requirements.

The audit committee’s primary purposes are to assist the board with its oversight responsibilities regarding:

Chief executive officer succession committee

In February 2011, our board created an ad hoc committee -- the chief executive officer succession committee -- comprised of board members Messrs. Pace, Taylor and Wareham, and advised by Mr. Pendarvis and Dr. Farrell, to evaluate and oversee succession planning for the chief executive officer role. The committee was chaired by Dr. Pace, and met on an as-needed basis. In March 2013, the board appointed a new chief executive officer and made other related executive appointments. Accordingly, the board decided there was no ongoing need for the committee, and dissolved the committee.

Communications with our board of directors

Any interested person, including any stockholder, may communicate with our non-employee board members by written mail addressed to the chairman of the nominating and governance committee, care of Secretary, ResMed Inc., 9001 Spectrum Center Boulevard, San Diego, California 92123 USA. We encourage stockholders to include proof of ownership of our stock in their communications. The

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secretary will forward all communications to the chairman of the nominating and governance committee.

Code of ethics

We have a code of business conduct and ethics for directors, officers and employees, which can be found at www.resmed.com. The code summarizes the compliance and ethical standards and expectations we have for all of our officers, directors and employees, including our chief executive officer and senior financial officers, with respect to their conduct in connection with our business. Our code of business conduct and ethics constitutes our code of ethics within the meaning of Section 406 of the Sarbanes-Oxley Act of 2002 and the NYSE listing standards. We intend to disclose future amendments to or waivers of certain provisions of our code of business conduct and ethics applicable to our principal executive officer, principal financial officer, principal accounting officer, controller and individuals performing similar functions on our website at www.resmed.com within five business days or as otherwise required by the SEC or the NYSE.

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Director Compensation — 2013

Fiscal year 2013 program – cash. Our non-executive director cash compensation program for fiscal year 2013 was revised, resulting in cash payments and equity grants as follows:

Fiscal year 2013 program – equity. During fiscal year 2013, we awarded an equity grant on our annual stockholders meeting date to our non-executive directors with a grant date fair value of $250,000. Our non-employee directors had the opportunity to elect to receive their equity grant in the form of: (1) 100% options; (2) 100% RSUs, or (3) 50% options and 50% RSUs. Four of our directors elected to receive 100% options, and two elected to receive 100% RSUs.

The number of options or RSUs we granted was based on a relative fair value calculation prepared by an outside third party. RSUs and options vest in full on the earlier of: (1) November 11 in the year after the grant date, or (2) the date of the first annual meeting of stockholders following the grant date. Non-executive directors are prohibited from selling or otherwise transferring 50% or more of the shares of common stock delivered to them on vesting of RSUs, and from exercising any vested options, until the earlier of November 11 in the third year after the grant date or six months after the director’s termination of directorship.

Changes for fiscal year 2013. The fiscal year 2013 director compensation program compared to the fiscal year 2012 as follows:

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Compensation philosophy. The compensation committee reviews non-executive director compensation, including reports from FW Cook, the committee’s independent compensation consultant. After its review, the committee makes recommendations on non-executive director compensation to the board, and the board makes the final determination regarding non-executive director compensation.

The compensation committee and board review data on both US peers and Australian peers, reflecting the company’s dual-listing locations. Australia and the US generally have different pay philosophies for compensating non-executive directors. ResMed’s Australian peers generally pay higher cash, award less equity, and have overall lower compensation for non-executive directors than ResMed’s US peers. While the board considers Australian peer data, the board believes the most relevant peers for ResMed director compensation are US peers. ResMed’s primary listing is on the NYSE, it is primarily subject to US corporate governance requirements and risks, and its headquarters and the majority of its senior executives and directors are in the US. In addition, this philosophy is also consistent with ResMed’s philosophy on executive compensation, which gives more weight to ResMed’s US peer’s pay practices. Finally, we do not wish to create internal or cultural divisions by using significantly differentiated pay models between directors based in the US and Australia.

Market Comparisons. In May 2012, the board and compensation committee reviewed director compensation for fiscal year 2013. They reviewed FW Cook’s report covering cash compensation and equity compensation, compared to a peer group of 16 medical device and medical technology companies. They also considered information from a group of eight Australian-based peers. The committee confirmed these peer groups in April 2012, and used the same peer groups to benchmark ResMed’s executive compensation for fiscal year 2013. More information on the peer groups is included in section below, Compensation Process – Peer group companies.

After considering this material and the compensation committee’s recommendation, the board agreed to continue cash and equity compensation levels from fiscal year 2012 (with the changes mentioned above), which would continue to target total annual compensation at approximately $300,000, the same value target used for fiscal years 2011-2012. This program aligned cash compensation in the bottom quartile as compared to the peer companies, equity compensation in the upper quartile compared to the peer companies and total compensation at approximately the 75^th percentile of peer companies. The board believes the 75^th percentile was the appropriate positioning, given that the lower cash/higher equity program has more performance risk, and more alignment with stockholders than many peer programs. A 75^th percentile total compensation positioning is also consistent with ResMed’s philosophy on executive compensation.

The compensation committee and board will continue to monitor compensation trends, competitive practices, tax regulations, and other matters related to non-executive director compensation, and make adjustments as appropriate.

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Equity ownership guidelines. We have adopted equity ownership guidelines for our non-executive directors. Each non-executive director is expected to hold ResMed stock with a value of at least five times the annual retainer amount (a total value of $250,000 based on the retainer and guidelines in effect in fiscal year 2013). Shares of stock and unvested RSUs count towards the guidelines, but stock options (whether in-the-money or not) do not count toward the guidelines. Existing directors have five years from August 2010 to meet this guideline. If these guidelines are not met, upon vesting of RSUs or option exercise, the director must retain shares equal to 50% of the after-tax value of shares acquired upon the vesting or exercise until the director’s guidelines are met. As of June 30, 2013, each of our non-executive directors met the equity ownership guidelines.

Cap on total cash compensation. At the 2010 annual stockholders meeting, our stockholders approved a cap in the total cash compensation paid to non-executive directors as a group of $800,000. This cap was originally required under a listing rule of the ASX. That listing rule no longer applies to us, because in 2011, the ASX approved a change in our admission category to an ASX Foreign Exempt Listing. Nevertheless, in fiscal year 2013, the non-executive directors received in the aggregate total cash consideration of $390,000, leaving room under the current aggregate cap for the addition of other non-executive directors, as intended. However, we have no current plans to increase the size of the board.

Changes for fiscal year 2014. In May 2013, the board adopted the following changes to the non-executive director compensation program for fiscal year 2014:

The board approved these changes after reviewing the compensation committee’s independent consultant’s report that with these changes, total board compensation would remain broadly in-line with the 75th percentile comparable peer companies’ practices.

New directors. New directors will pro-rate their value-based equity awards and retainers (for the period between their start date and the next annual meeting or service period, respectively). We do not provide new directors with any initial inducement equity awards.

Executive directors. Our officers do not receive additional compensation for their service as directors.

Fiscal year 2013 compensation table. The table below summarizes the compensation received by our non-employee directors for the year ended June 30, 2013:

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Executive Officers

As of the record date, September 16, 2013, our executive officers were:

BIOS

For a description of the business background of Mr. Michael Farrell and Dr. Peter Farrell, see “Items of Business – Proposal 1: Election of Directors.”

DON DARKIN

President – sleep-disordered breathing strategic business unit

Don Darkin has been president, sleep-disordered breathing strategic business unit since May 2011. Previously he was senior vice president, strategic business unit – patient interfaces from July 2007 to May 2011. Before these positions, Mr. Darkin held several senior roles within ResMed. He joined ResMed in August 1999 as vice president, product development. In May 2005, he became director of operations in France for ventilation, and subsequently served as vice president, business divisions, and senior vice president, global product development. Before working at ResMed, Mr. Darkin served as vice president of operations for Ambri Pty (Molecular Engineering and Biotechnology) Ltd., Australia, and vice president, product development for Telectronics Medical Systems Australia and US. Mr. Darkin is identified as an inventor or co-inventor on over 80 granted patents worldwide. Mr. Darkin was educated in the UK in mechanical engineering and has further professional management training from University of New South Wales and Massachusetts Institute of Technology.

ROBERT DOUGLAS

President and chief operating officer

Robert Douglas has been ResMed’s president since March 2013, and our chief operating officer since September 2011. Together with our chief executive officer, he holds full operational responsibility for ResMed and its subsidiaries. Mr. Douglas has had an extensive career within ResMed. His former roles include president – Asia Pacific and chief, global supply operations from May 2011, responsible for global manufacturing and commercial distribution and sales operations in the Asia Pacific region; chief operating officer – Asia Pacific since 2008; chief operating officer – Sydney from 2005, responsible for our manufacturing and research and development; vice president of operations from 2003 responsible for our manufacturing and vice president of respiratory and cardiac business from 2002. Mr. Douglas first joined ResMed in 2001 in the role of vice president of corporate marketing. Mr. Douglas has a Master of Business Administration from Macquarie University, a bachelor’s degree in electrical engineering with first-class honors and a B.Sc. (Computer Sciences) from the University of New South Wales, Sydney. Mr. Douglas currently serves on the board of directors of the San Diego Regional Economic Development Corporation.

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JAMES HOLLINGSHEAD

President – Americas

James Hollingshead was appointed president – Americas in March 2013. Mr. Hollingshead joined ResMed in March 2010 as vice president of strategy and business development. In August 2011, his role was expanded to include the leadership of ResMed ventures and initiatives, the unit responsible for growing early stage businesses. Before joining us, Mr. Hollingshead spent 18 years in strategy consulting, where he worked with senior executives across a wide range of industries. From September 2008 to February 2010, he was a senior partner in the strategy and life sciences practices in Deloitte Consulting, based in San Francisco. Before that Mr. Hollingshead was managing partner, west coast for Monitor Group, a global strategy consulting firm. While at Monitor Group, Mr. Hollingshead worked in various offices around the world, and successfully launched and ran three different practices, including a pan-European marketing strategy practice based in London. Mr. Hollingshead holds an A.B. in history and international relations with highest distinction from Stanford University, and an M.A. and Ph.D in political science from the University of California at Berkeley, where he was awarded a graduate student fellowship by the National Science Foundation.

DAVID PENDARVIS

Chief administrative officer, global general counsel and secretary

David Pendarvis was appointed chief administrative officer in May 2011 and remains global general counsel, a position he has held since joining ResMed in September 2002 and corporate secretary since February 2003. Mr. Pendarvis was senior vice president, organizational development from February 2005 to May 2011. From September 2000 until September 2002, Mr. Pendarvis was a partner in the law firm of Gray Cary Ware & Freidenrich LLP, where he specialized in intellectual property and general business litigation. Until September 2000 he was a partner with Gibson, Dunn & Crutcher LLP, where he began working in 1986. From 1984 until 1986 he was a law clerk to the Hon. J. Lawrence Irving, US District Judge, Southern District of California. Mr. Pendarvis is also a member of the board of Sequenom, Inc., a NASDAQ-listed company providing molecular diagnostic testing and genetic analysis solutions. He holds a B.A. from Rice University; a J.D., cum laude, from the University of Texas School of Law; and a master of science in executive leadership from the University of San Diego.

ANNE REISER

President – Europe

Anne Reiser was appointed president – Europe in March 2012. She had served as our chief operating officer - France since 2007, after joining as the sales director in 2006. Before joining ResMed, her career experience was in the medical device industry (Mölnlycke, Zimmer, American Home Product). More recently she worked for Medtronic and Hollister, with responsibilities for both France and finally southern European countries. Ms. Reiser has a master degree from Ecole Supérieure de Commerce de Clermont-Fd (Business School), and a bachelor degree of law from the University of Clermont-Ferrand and an executive master in management and healthcare policies from SciencesPo Paris.

BRETT SANDERCOCK

Chief financial officer

Brett Sandercock has been chief financial officer since January 1, 2006. From November 2004 until December 2005, Mr. Sandercock was vice president, treasury and finance at ResMed. Before that, from 1998 to November 2004, Mr. Sandercock was group accountant and then controller at ResMed. From March 1996 to August 1998 he was manager, financial accounting and group reporting at Norton

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Abrasives, a division of the French multi-national, Saint Gobain. Mr. Sandercock also held finance and accounting roles from November 1994 to March 1996 at Health Care of Australia, a large private hospital operator in Australia. From 1989 to 1994, Mr. Sandercock worked at PricewaterhouseCoopers in Sydney, specializing in audits of clients predominantly focused on distribution and manufacturing, financial services and technology. Mr. Sandercock holds a B.Ec. from Macquarie University and is a certified chartered accountant.

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Compensation Discussion and Analysis (CD&A)

Introduction

This compensation discussion and analysis section discusses the compensation policies and programs for our named executive officers. During fiscal year 2013, two persons served as our principal executive officer: Dr. Peter Farrell, from July 1, 2012 through February 28, 2013; and Michael Farrell, from March 1, 2013 through the end of the fiscal year and currently. Our other named executive officers for fiscal year 2013 were Brett Sandercock, our chief financial officer, and our three next most highly paid executive officers: Robert Douglas, our president and chief operating officer; James Hollingshead, our president – Americas; and David Pendarvis, our chief administrative officer, global general counsel and secretary.

This section also discusses the role of the compensation committee of our board in the design and administration of our compensation programs and policies and in making compensation decisions for our executive officers.

Overview of fiscal year 2013 – executive summary – please see the corresponding section in Proposal 3: Advisory vote to approve named executive officer compensation.

Financial success. During the 2013 fiscal year, we continued our trend of successful financial performance with growth in net revenue, net income and diluted earnings per share, as illustrated below:

In addition, we experienced strong relative total stockholder returns (TSR) on the NYSE for the one-year, three-year and five-year periods ended June 30, 2013, as compared to the peer group we use for our compensation purposes.

Because our primary listing is on the NYSE, our TSRs based on performance of our CHESS Units of Foreign Securities trading on the ASX is impacted by currency fluctuations between the US and Australian dollars. Nevertheless, our one-, three-, and five-year total stockholder returns on the ASX are, respectively, 63%, 12%, and 22%. They compare to our Australian peers similarly, with total stockholder return that is greater than the 75^th percentile over one year, approximates the median over three years, and is above the 75^th percentile over five years, respectively. Total stockholder return is also above the ASX 100 index for each of those three time periods.

During the first three months of fiscal year 2014, our total stockholder return has continued to perform well. As of September 16, 2013, a share of ResMed stock had increased in value by more than 15% on the NYSE, and more than 10% on the ASX.

Dividend. During fiscal year 2013, we began paying a quarterly dividend of $0.17 per share. In August 2013, we announced an increase in the dividend to $0.25 per share. While dividends and other capital

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management activities are not directly related to executive compensation, many of our stockholders mentioned their preference for dividends while discussing executive compensation. Accordingly, the board considered this input, along with other factors it found appropriate, in making its decision.

Successful Succession Planning. Effective as of March 1, 2013, we completed a multi-year CEO succession planning process with the appointment of Michael Farrell, our former president – Americas, to serve as our chief executive officer. In conjunction with this appointment, Dr. Peter Farrell, the then-current chairman of the board, president and chief executive officer, was appointed to serve solely as the executive chairman of the board, and Robert Douglas, our then-chief operating officer also assumed the role of president, while James Hollingshead assumed the position of president – Americas.

We made compensation changes that supported the succession. The compensation committee set Michael Farrell’s base salary at slightly less than the 25^th percentile of our peer companies, reflecting his new appointment to the role, but set his short-term bonus percentage at a median level. This cash compensation opportunity was substantially lower than the amount we had paid to Dr. Farrell in this role. But the committee positioned Michael Farrell’s total equity value (including equity he received in November 2012 in his previous role) at the 75^th percentile of peer companies, reflecting a greater weighting toward long-term performance to align him with shareholders after the promotion and to retain him as chief executive officer. The committee also approved promotional equity grants for Mr. Douglas and Mr. Hollingshead to provide long-term retention incentives and to align rewards with long-term performance in support of the leadership transition. At the same time, the committee also reduced Dr. Farrell’s base salary by half, and reduced his bonus percentage, to reflect the reduced scope of responsibility in his new role.

Compensation tied to performance. We believe that our executive officers were instrumental in achieving our positive financial results. We further believe that the compensation paid to our named executive officers for fiscal year 2013 reflects and is tied to their contributions to our success. During 2013, approximately 85% of our current chief executive officers’ compensation, and 82% of our other named executive officers’ compensation was at risk and tied to our financial and stock price performance.

We achieved 100% of the adjusted global net sales goal, and we achieved 111% of the net profit as a percentage of sales goal, which resulted in a corporate bonus payout of approximately 118% of target. Bonus payments to our named executive officers reflected this success and were paid at amounts ranging from approximately 103% to 118% of their target bonus opportunities, with those below 118% difference due to performance versus the regional component of their bonus. Our current chief executive officer earned approximately 112% of his target bonus opportunity based on his composite financial metrics for his different roles during the year. One quarter of his bonus was a blend of a payout of 107% on our corporate goals, for his performance as chief executive officer from March 2013, and three-quarters based on a payout of 116% on our regional goals, for his performance as president – Americas. Because our financial performance exceeded our targets, our bonus payments

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exceeded target levels, which resulted in total cash compensation for our named executive officers at or above median as compared to our peer companies. However, our chief executive officer’s bonus was pro-rated for service in the role, so his actual take-home cash bonus is below the median of our peer chief executive officers in their position for an entire year.

For fiscal year 2013, the only target bonus opportunities that changed among named executive officers was for those whose responsibilities changed during the year. Effective March 1, 2013, Mr. Michael Farrell’s target bonus increased from 75% to 100% of salary with his promotion to chief executive officer; Mr. Douglas’ target bonus increased from 80% to 90% with his promotion to president and chief operating officer; and Dr. Peter Farrell’s target bonus decreased.

The other 50% of the value of our annual equity awards are granted in the form of either (1) stock options, or (2) restricted stock awards. Both the options and RSU awards time vest over a three-year period, but the RSU awards, consistent with prior years, are subject to the performance condition that we achieve 50% of our budgeted net profit in our third and fourth quarters, either individually or combined.

The program is illustrated below:

We believe this design best balances the competing considerations of pay-for-performance orientation, stockholder alignment, retention, and administrative complexity. In addition, it balances the current practices among our US-based peers, who currently grant a majority of the value of their equity awards in the form of time-vested stock options or restricted stock. In contrast, most of our Australian peers grant a majority of the value of their equity awards in the form of performance-based restricted stock. Most of our executive officers reside and work in the US, our primary listing is on the NYSE, and most of our competitors are US-based, so we think this balance is appropriate. In connection with this change, we also reduced the vesting period from four to three years for RSUs and stock options granted to our named executive officers in 2013 and thereafter, to offset the increased deferral and downside risk from the shift to PSUs.

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We made two grants of performance share awards during fiscal year 2013: on the date of our 2012 annual meeting, to all of our named executive officers, and on March 1, 2013, in connection with the promotions of Mr. Michael Farrell as our chief executive officer and of Mr. Douglas as our chief operating officer and president. Based on performance through June 30, 2013, the November 2012 and March 2013 grants would have delivered payouts at 83% and 157% of the target, as shown in the table below. Since the awards have over two years to run, any mid-period payout calculation is hypothetical. Nevertheless, the estimates show how the awards are designed to fluctuate in value based on our total stockholder return’s relative performance.

Restricted stock units and options. On the date of our 2012 annual meeting, in accordance with our equity program we also made our annual RSU grants and options to our named executive officers. This is the regular timing of our annual grants. All RSU grants to the named executive officers may only be earned based on exceeding a minimum targeted pro forma net profit for the second half of fiscal year 2013. Because we exceeded the minimum targeted pro forma net profit for the second half of fiscal year 2013, all RSUs that were granted during fiscal year 2013 were earned, but continue to be subject to a three-year service-based vesting requirement from the grant date.

We made additional equity grants as part of the succession process in March 2013. The compensation committee structured grants for our newly-appointed chief executive officer, Michael Farrell, in an amount which, when combined with the grants Mr. Farrell previously received in November 2012, brought his total equity value for the fiscal year to the approximate 75^th percentile of peer group companies. That grant was then structured so that, of his total fiscal year 2013 equity grants, the value that approximated the peer group median was split half and half between PSUs with a three-year TSR measurement period beginning March 1, 2013, and half in RSUs vesting over three years and also subject to a performance condition based on second-half fiscal year 2013 profit. The balance of the March 1 equity grant, represented roughly the approximate value between the median and the 75^th percentile, and was awarded as stock options at a strike price set at the March 1, 2013 market price, time-vesting over four years. The committee chose this structure to provide a balance between performance-alignment, stockholder return alignment, and retention for a new chief executive officer promotion.

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We also made equity grants to Mr. Douglas and Mr. Hollingshead in connection with their March 1, 2013 promotions. Mr. Douglas received a grant that brought his total fiscal year equity grant value to approximately the 75^th percentile, awarded half in PSUs, and half in RSUs. The committee awarded Mr. Hollingshead an additional March 2013 equity award that was not market-data based, but rather represented a promotional award to retain him long-term and further align his interests with stockholders. This was awarded as a four-year time vesting stock option.

Last year’s say on pay vote and implementation of emerging best practices. At our 2012 annual meeting, approximately 81% of our stockholders voted to approve, on an advisory basis, the compensation paid to our executive officers disclosed in last year’s proxy statement. In response to our stockholders’ input in 2011 and 2012: (1) effective June 30, 2012, we revised all of our change of control agreements with our executive officers to eliminate any excise tax gross-ups; and (2) beginning in fiscal year 2013, we began granting 50% of the value of the equity grant made to executive officers as PSUs, measured over a three-year period, with the ultimate number of shares to be received depending on ResMed’s total stockholder returns compared to companies included in the US Dow Jones Medical Device Index, a broad-based index of medical device companies.

Philosophy and objectives of our executive compensation program

We want to attract, motivate and retain high-quality employees who will enable us to achieve our short-term and long-term strategic goals and values. We operate in a high-growth environment where substantial competition exists for skilled employees. Our ability to attract, motivate and retain high-caliber individuals depends in large part on the compensation packages we offer. We believe that our executive compensation programs should reflect our financial and operating performance. In addition, individual contribution to our success should be supported and rewarded. In designing and implementing our executive compensation program, the committee is guided by the following principles:

Finally, RSUs are also subject to a performance condition related to our net profit.

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The following pie charts illustrate the allocation of total direct compensation that the named executive officers (NEO’s) earned for fiscal year 2013:

We are committed to a philosophy of total pay (the sum of the cash compensation opportunity, the fair value of the equity compensation opportunity, and benefits programs) being competitive within relevant labor and stockholder markets when our performance meets target performance criteria set forth in our bonus programs. Total pay will typically lag the market when our performance is below the performance goal criteria set forth in the bonus programs and will typically exceed competitive levels when our performance is above the performance criteria set forth in the bonus programs as annual goals. We try to set the performance goals at a level that justifies the competitive position of target compensation and believe that actual fiscal year 2013 performance aligned with actual cash compensation levels in our peer group.

This positioning was consistent with the relative comparison of our fiscal year 2012 annual operating performance, measured by revenue growth, operating income growth, and return on invested capital. These metrics generally also ranked between the 60^th and 75^th percentiles of our peers, indicating good execution of the committee’s compensation position and alignment with actual operating performance and performance expectations.

As discussed above, we exceeded our performance goals for fiscal year 2013. And our revenue growth, operating income growth, and return on invested capital all exceeded the 75^th percentile of peer companies. Our actual cash compensation reflected this over-performance by bonuses that adjusted up for over-achievement. As a result of performance that exceeded the 75^th percentile in most measures, our actual total cash compensation to our named executive officers exceeded the 75^th percentile in most instances. However, our current chief executive

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officer’s cash compensation was below the 25^th percentile, reflecting his partial year of service as chief executive officer and our conservative positioning of his compensation versus competitive benchmarks after the promotion.

As discussed above, we introduced PSUs into our equity program for fiscal year 2013, and they represented 50% of the equity value in our annual grants. We continued our practice of providing named executive officers the choice to select whether the balance of their equity awards would be entirely in the form of stock options, entirely in RSUs or evenly split (in value) between the two. Grant values were established by the committee, and the relative ratios of PSUs, RSUs, or stock options was determined by the relative values computed under Financial Accounting Standards Board Accounting Standards Codification Topic 718. In addition, the committee continued its practice of granting RSU awards to our executive officers and certain other officers conditioned on achieving certain performance targets, in addition to having a time-based vesting period. This condition is intended for units to qualify as performance-based compensation under US tax laws and preserve the deductibility of the compensation paid, and also provides a tie to our performance.

Compensation process

Compensation committee role. The compensation committee reviews and approves salaries, bonuses, equity-based compensation, and all other elements of the compensation packages offered to our executive officers, including our named executive officers, and establishes our general compensation policies. The board has determined that all members of the compensation committee are independent directors under NYSE standards.

On an annual basis, the committee considers each of the three primary elements of compensation (salary, cash incentives and equity) based on market analysis, individual performance, the perceived value of the individual to ResMed and other factors it deems relevant. The committee also considers regional variation. For example, base salaries for certain positions in countries outside the US, when translated to US dollars, may reflect a different percentile when compared to US market peers than when compared to market peers in an executive’s home country. There are similar regional variations in the use of short-term and long-term incentives. The committee attempts to balance the goal of paying consistent with the local market, with the goal of maintaining internal consistency in compensating executives in different regions, and creating common alignment among the executive team.

Timing of decisions. Generally, our executive officers’ compensation is adjusted each year effective October 1, the beginning of our second fiscal quarter. This is a long-standing practice that allows us to consider the previous year’s performance, and new year’s performance goals, in compensation decisions. Accordingly, the committee generally makes decisions on the principal components of executive officer compensation – base salary, bonus potential, equity awards, and perquisites – during

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the first quarter. Specific performance bonus targets for executive officers are generally determined before or during the first month of the fiscal year for that year. Determining actual performance versus targets and calculating bonus payouts generally occur in the first two months following the end of our fiscal year. Bonus payments to our executive officers are made after the fiscal year-end audit is complete. If other executive compensation issues arise during the course of the year, the committee takes those issues up on a case-by-case basis. Determinations regarding promotions are generally made contemporaneous with the promotions.

Independent compensation consultant. In making its decisions, the committee reviews data obtained from peer group companies and considers the recommendations of management and the advice of its independent compensation consultants regarding each element of compensation. The committee has independent authority to retain advisors. The committee has retained FW Cook, Inc., an independent compensation consultant, to advise the committee with respect to executive compensation matters for executive officers. FW Cook performs no work for us other than its work providing executive compensation consulting services to the committee. During fiscal year 2013, the committee reviewed the independence of FW Cook, and its other advisors, including considering the factors required by NYSE listing standards. After the review the committee determined FW Cook was independent and that no conflict of interest existed that would prevent FW Cook from providing independent and objective advice to the committee.

During fiscal year 2013, the committee reviewed market practices and benchmark data from FW Cook and considered ResMed’s and our executives’ relative performance and the recommendations of the consultants when setting compensation. For fiscal year 2013, FW Cook also advised the committee regarding the Australian company benchmarks for the positions of our chief executive officer, as well as executive officers who reside there. The committee also considered the experience and knowledge of committee members regarding compensation practices for comparable positions at other companies. Although the committee considers various sources of information and recommendations, ultimately, of course, the committee relies on its own independent judgment.

Management’s role. Our chief executive officer, our chief administrative officer and global general counsel, our chief human resources officer, and other members of management provide input and recommendations to the committee regarding pay to the executive officers and other members of management for their review and approval. While the committee gives consideration to these recommendations, it exercises independent judgment. Management provides to the compensation consultants and to the committee historical and prospective breakdowns of total compensation components for each executive officer and financial data in support of the various compensation components. Management also provides recommendations that include financial goals and criteria for our annual and long-term incentive plans. Management gathers the information it provides from consultants, the market, and internal resources, allowing designs and strategies to be tied directly to our business needs. While management typically attends committee meetings, the committee chair excuses individual management members as appropriate for independent review or decision-making.

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Peer group comparisons. In making its decisions on executive compensation, the committee generally uses industry compensation surveys prepared by outside consultants. In August 2012, FW Cook, the committee’s independent compensation consultants, performed an executive compensation review based on current US and Australian market compensation data. The US peer companies were generally within one-quarter and four times the size of our revenue and market capitalization, with ResMed in the middle to avoid bias from too many large or small peer companies. The compensation committee confirmed the peer group in May 2012, and companies comprising the US peer group were:

The committee believes that this peer group reflected a reasonable cross-section of our labor market for talent and included companies that our investors might consider in determining the reasonableness of our pay and alignment of our pay with our performance. Consistent with these selection criteria, for fiscal year 2013, the committee removed from the peer group two companies that had been acquired: Beckman Coulter and Kinetic Concepts; and added Hologic, Inc. (which met the committee’s revenue and market capitalization criteria) to the group used for fiscal year 2012.

Each position was reviewed against comparable positions within our peer group. The committee periodically reviews the composition of the peer group and the criteria and data used in compiling the list, and considers modifications to the group. We select peer companies that are medical device or medical technology companies with a market capitalization, stockholder return, profitability, revenue and employee population roughly comparable to ours.

In August 2012, the committee also considered compensation survey data from eight similarly-sized Australia-based publicly listed companies for our Australia-based chief financial officer and our president – Asia Pacific, as well as for our chief executive officer. The committee generally gives less weight to the Australian peer group. First, because of the small number of publicly-traded global medical device companies in Australia, the peer group is less comparable. In addition, FW Cook noted that Australian peer companies typically have different pay models with higher salaries and lower incentives. The Australian peer group companies reviewed were:

The committee decided to eliminate two companies used in the fiscal year 2011 Australian peer group: Primary Health Care and Worley Parsons, on the basis that their business characteristics and financial metrics were not sufficiently comparable to ResMed.

Elements of compensation

Base salary. Base salaries provide our executives with a degree of financial certainty and stability. In order to attract and retain highly qualified executives, we pay within salary ranges that are generally

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based on similar positions in companies of comparable size and complexity. Using the peer group data, the committee assesses base salaries at the median, 60^th and 75^th percentiles with the goal of positioning base salary around the 60^th percentile. Adjustments are made based on the final committee assessment.

Salary adjustments are generally made annually to be effective October 1, at the start of the second quarter of our fiscal year. In August 2012, the committee approved a base salary increase effective October 1, 2012 for all of our named executive officers. Dr. Farrell, and Messrs. Sandercock, Pendarvis, and Hollingshead each received a salary increase of between 5 and 6% or greater, reflecting a typical increase broadly consistent with our budgeted increase for non-executive officers. Mr. Farrell and Mr. Douglas received larger increases of 12.3% and 8.5% respectively, based on comparable market data for their positions. Messrs. Douglas and Hollingshead’s salaries were set at our more typical positioning, approximately between the 60^th and 75^th percentiles.

In March 2013, in connection with their promotions, the compensation committee reviewed updated peer group data from our independent compensation consultant for the new positions of Messrs. Farrell, Douglas, and Hollingshead. After considering that data, the committee increased their salaries by an additional 83%, 13%, and 16%, respectively. After these increases, Mr. Farrell’s base salary was at approximately the 25^th percentile, primarily reflecting his experience in this role, while still resulting in a substantial increase, while Messrs. Douglas’ and Hollingshead’s salaries were approximately between the 60^th and 75^th percentiles, reflecting their experience and importance to the company’s strategy.

For Mr. Sandercock, the amounts shown in the table below represent the US dollar equivalent of his non-US dollar-denominated salaries, with actual compensation expense varying based on currency fluctuations. We believe that year-to-year currency fluctuations make the constant currency increases most meaningful for officers residing outside the US.

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Annual performance-based bonuses. The second direct compensation component is a cash bonus under our annual bonus program. The primary purpose of our annual bonus program is to motivate our executives to meet or exceed our company-wide, regional, and business unit short-term operating performance objectives. The program is intended to share our success with eligible executives to the extent warranted by our performance, and to provide competitive compensation to eligible executives in a manner consistent with our philosophy of paying for performance. The bonus program is intended to qualify as a performance-based award under our incentive plan as well as performance-based compensation for purposes of section 162(m) of the US Internal Revenue Code.

In setting appropriate bonus target opportunities for fiscal year 2013, the committee reviewed the 50^th, 60^th, and 75^th percentiles of peer comparables (both in terms of target amounts and amounts actually earned). The committee also considered the potential effect of bonus targets on total cash compensation and reviewed total cash compensation at peer comparables at those percentiles. For fiscal year 2013, the committee initially maintained the target bonus opportunity at the same levels as fiscal year 2012 for all named executive officers: 120% of base salary for the chief executive officer, 80% for the chief operating officer, and 75% for other named executive officers.

In March 2013, various target bonus opportunities were changed in connection with the management succession. Michael Farrell’s target bonus opportunity was set at 100% of salary (previously 75%), reflecting market data and his appointment to the role of chief executive officer. Mr. Douglas’ target bonus opportunity was increased to 90% in connection with his promotion to president and chief operating officer, reflecting market data for his new role. Dr. Farrell’s target bonus opportunity was decreased from 120% to 100%, reflecting a reduction in his responsibilities, while considering his unique role as founder and executive chairman. These changes were made effective as of March 1, 2013, resulting in pro-rated blended target bonus opportunities for the full year.

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The committee believes it best to tie each executive’s incentive pay to the areas over which the executive can assert the most influence and to vary the weighting to reflect the relative focus desired by the executive for each metric. The committee continues to believe that net sales and net profit as a percentage of revenue are important performance metrics on a global and regional basis because these goals focus on profitably increasing our revenue. We have consistently used these same bonus metrics for several years.

For fiscal year 2013, our executive officers with primarily global responsibilities had bonuses determined based on pre-established performance measures of our global adjusted net sales and adjusted net operating profit after tax as a percentage of sales, weighted equally. This applied to Dr. Farrell and Messrs. Douglas, Pendarvis and Sandercock for the entire fiscal year, as well as Messrs. Farrell and Hollingshead, for the time they were chief executive officer and chief strategy officer, respectively. Other executive officers with primarily regional responsibilities had a percentage of their bonus opportunity tied to these global metrics and a percentage tied to similar metrics at the regional or product level for which they were responsible. This applied to Messrs. Farrell and Hollingshead, for the respective times they were each president – Americas. Mr. Farrell’s and Mr. Hollingshead’s bonuses for the full year were calculated pro rata, based on their time in each role.

The performance measures and their weighting by named executive officer for fiscal year 2013 were as follows:

The fiscal year 2013 payout structure, based on achieving pre-established targeted milestones for each performance metric, is identical for each metric and is described in the following table. Payouts are expressed as a percentage of target bonus opportunity after giving effect to the weighting for the performance metric. Performance between and above the milestones listed below is paid based on linear interpolations.

The committee approves the actual bonus amounts for executive officers after review of our financial data and performance. The committee has established a cap on the maximum amount of bonus payout per executive officer at 200% of that officer’s target bonus opportunity.

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The fiscal year 2013 targets and actual performance for each of the metrics are listed below.

Our 2013 revenue target represented 11% growth versus our 2013 revenue. Our 2013 net profit percentage target was consistent with our 2012 adjusted net profit as a percentage of revenue.

We also achieved 103.36% and 104.70% of our Americas net sales and Americas net operating profit as a percentage of revenue targets, respectively, for the first three quarters of fiscal year 2013, which impacted Michael Farrell’s bonus; 99.98% and 94.57% of our Americas net sales and Americas net operating profit as a percentage of revenue targets, respectively, for the fourth quarter of fiscal year 2013, which impacted Mr. Hollingshead’s bonus. At the time the compensation committee set the regional and business unit metrics, the regional net sales and net operating profit as a percentage of revenue targets were determined to be challenging but attainable.

For fiscal year 2013, applying the pre-determined bonus payment formula, and without the use of any discretion, the committee determined that the following percentages of target bonus opportunities would be paid:

In calculating bonus metric achievement, the committee made the following adjustments from our GAAP financial statement revenue and net profit calculations to eliminate the impact of certain non-operating revenue and expenses:

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The following table sets forth the 2013 target and actual bonus payments. All actual bonuses were funded under pre-established formulas, and do not reflect any discretionary adjustment by the compensation committee.

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In order to promote the retention value of our incentive programs, the committee has adopted a policy that we will not pay any bonus or other short-term incentive awards in the event of a separation of employment of an executive officer before the date of the payment. This policy does not impact options, RSUs, or other long-term incentives that have vested at the time of separation.

The committee has approved a bonus program for fiscal year 2014 that incorporates the same metrics and weighting as in fiscal year 2013.

Long-term equity award program. The third major component of our named executive officers’ direct compensation provides a long-term incentive and alignment with stockholders through equity participation. The primary purpose of granting equity awards is to link our officers’ financial success to that of our stockholders, with the value of the equity awards increasing only as the stock price increases. Fifty percent of the value of the annual equity grants made to executive officers in fiscal year 2013 were performance-based, measured over a three-year period, with the ultimate number of shares to be received depending on ResMed’s TSRs compared to companies included in the US Dow Jones Medical Device Index, a broad-based index of medical device companies. The other 50% of the value of our equity awards are granted in the form of either (1) stock options, or (2) restricted stock awards. We use PSUs, RSUs, and stock options in the equity award program to provide a mix of awards that increases the capability of the committee to manage more effectively our use of shares under our stock plan, balance the leverage and risk provided by various equity vehicles, more closely conform with practices at our peer companies, and provide more tax-effective equity awards (particularly for our Australian-based executives in light of Australian tax treatment of option grants).

The committee generally granted half the value of the annual equity grants to our named executive officers in PSUs, and allowed the executives to choose, before the grant date, whether the other half of the equity value would be entirely in the form of stock options, entirely in RSUs, or evenly split in value between the two. The combined availability of options and RSUs enables the award designee the opportunity to balance the incentive award in a manner that suits their particular risk profile and with respect to their own preferences in financial or tax planning in the US and non-US jurisdictions.

In determining the value of awards granted to specific named executive officers, the committee reviews our performance, the number of outstanding awards available, the percentage of the pool represented by the proposed grant, the present value of the proposed grant, existing option ownership, the awards granted in the prior year and the three prior years, and the grant practices of our peer group companies. For fiscal year 2013, the committee reviewed peer company data to determine competitive equity award values, at the median, 60^th and 75^th percentiles, for each officer’s position.

FW Cook reported that the grants we gave during fiscal year 2013 to Dr. Farrell, as our then-chief executive officer in November 2012, and to Michael Farrell, as our newly-promoted chief executive officer in March 2013, were both at about the 55^th percentile compared to our peers. FW Cook also

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reported that grants to our remaining named executive officers were at the 75^th percentile in aggregate, with most at or near approximately the 75^th percentile. For fiscal year 2013, the committee decided to set equity grants at a particular dollar value, the actual number of awards depending on the relative values of the equity on the day of the grant. For most named executive officers, equity grants were set at values broadly consistent with the fiscal year 2012 values, except for Mr. Douglas and Mr. Hollingshead, whose grant values increased by approximately 100% and 54%, respectively reflecting their March 2013 promotions. (The grant value is the sum of the regular annual grant provided in November 2012 and the special one-time promotion grants in March 2013.) The committee also continued the practice it followed in previous fiscal years, and normalized award sizes to most of our named executive officers so that they reflected both internal equity relationships and the market data. The purpose is to promote a team-based approach by our senior management team, ensure equitable internal relationships, and eliminate geographical distinctions in equity grants. In arriving at the specific grant size, the committee considered the peer group benchmarks at an individual level, as well as aggregate equity compensation for similar groups of our peers.

In March 2013, in connection with the chief executive officer succession, the committee made additional grants to executives whose responsibilities increased, as discussed above. In deciding on these awards, the committee reviewed market data for comparable positions at peer companies, and also considered its goals to retain these executives and align their compensation with long-term performance. For our newly-appointed chief executive officer, Michael Farrell, the committee approved a total equity grant value of $2,730,000, which, when combined with the grants Mr. Farrell previously received in November 2013, brought his total equity value for the fiscal year to $4,030,000, or approximately the 75^th percentile of chief executive officers at peer group companies. That March 2013 grant was structured as follows: equity with a value of $1,730,000 was issued under the structure used in the November 2012 annual grant, with half ($865,000) in PSUs with a 3-year TSR measurement period beginning March 1, 2013, and half the ($865,000) in RSUs vesting over three years and also subject to a performance condition based on second half fiscal year 2013 profit. This incremental grant, combined with the November 2012 grant, brought total equity value for the year for Mr. Farrell to the median of the March 2013 peer group data for his position. In addition, the committee believed it appropriate to make an additional grant, roughly representing the incremental value to bring total equity value to approximately the 75^th percentile as means of recognizing his promotion to the chief executive officer position. That March 1 equity grant, with a value of $1 million, was awarded as stock options at a strike price set at the March 1, 2013 market price, time-vesting over four years. The committee chose this structure to provide a balance between performance-alignment, shareholder return alignment, and retention.

We also made equity grants to Mr. Douglas and Mr. Hollingshead in connection with their March 1, 2013 promotion. Mr. Douglas received a grant with a value of $1 million, awarded half in PSUs, and half in RSUs, on the same terms as Mr. Farrell’s March 2013 PSU and RSU grants. This grant, combined with his November 2013 annual grant, brought his total equity grant value for fiscal year 2013 to $3.1 million, or the approximate 75^th percentile of peer group data. The committee awarded to Mr. Hollingshead a $400,000 value equity award, with 100% granted as a stock option on the same terms as Mr. Farrell’s March 2013 option grant. This grant was not determined on the basis of market data, but instead represented a one-time promotional grant.

The following table sets forth equity grant values provided to our named executive officers in fiscal year 2013, as well as the elections made by our named executive officers regarding the form of award to receive. When it approved the equity grants described above, the committee used estimated grant values to calculate the number of stock options, RSUs, or PSUs granted. The equity grant values in the table below reflect actual values calculated after the grants were made, which vary slightly from the estimated values used by the committee. The actual values were based on the closing stock price on the date of grant of $38.98 on November 15, 2012, and $43.63 on March 1, 2013, and a Black-Scholes

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formula for the options, and a Monte-Carlo simulation for the performance units, each consistent with the accounting standards of FASB 718.

In addition, the committee continued its requirement that RSU awards granted to our executive officers and certain senior executives would, in addition to having a vesting period, be earned based on performance targets as shown in the table below. These conditions require that RSUs are only earned when we meet threshold levels of profitability. After grant, RSUs granted may be earned based on our actual performance compared to targeted levels of earnings for each of the three performance periods: (1) third fiscal quarter; (2) fourth fiscal quarter; and (3) the third and fourth fiscal quarters combined. No more than 100% of the RSUs granted may be earned, and once the target is met for a performance period, all RSUs associated with that period are earned. If the target for a performance period is not met, none of the RSUs for that period is earned. However, if the cumulative target for both periods is achieved in either period or in the combined period, 100% of the RSUs granted are earned. The committee determined that the performance condition on the November 2012 and March 2013 RSU grants to executive officers had been met, as shown in the table below.

As a result of our earnings performance for the third and fourth quarters of fiscal year 2013, 100% of the RSUs granted were earned. Because the combined periods’ earnings were sufficient, there was no need to review the quarterly earnings independently.

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Once the RSUs granted in fiscal year 2013 were earned, they remained subject to a vesting requirement based on service with us, with 33% vesting each year as described more fully below under “Terms of stock options, performance-based stock units, and restricted stock units.”

Beginning in fiscal 2013, we granted PSUs that are measured and earned after a three-year period based on our TSR performance relative to companies included in the US Dow Jones Medical Device Index. This was viewed as an objective and relevant list of other companies a typical ResMed investor might choose. New entrants to the index during the performance period are not added to the peer group and companies that fall out of the index mid-cycle, but continue trading, are not removed from the group. Companies that stop trading mid-cycle due to going private, acquisition or similar events are excluded from the final TSR calculation and companies that go bankrupt remain in the peer group and are assigned a TSR of -100%. The share price at November 15, 2012 is used as the starting point for the TSR calculation, and a trailing 30 trading-day average share price is used to calculate the share price at the end of the performance period.

The awards require us to perform at the median of the index before any portion of the performance-based equity awards is earned, and require performance at the 60^th percentile to earn the target number of shares. Shares earned may range from a minimum of 0% of target shares, to a maximum of 200% of target shares, based on the following schedule:

We made two grants of performance share awards during fiscal year 2013: on the date of our 2012 annual meeting, to all of our named executive officers, and on March 1, 2013, in connection with the promotions of our chief executive officer and our president and chief operating officer. The grants were made under the same program, except that the performance period for the November 2012 grants is November 12, 2012 through November 11, 2015, whereas the performance period for the March 2013 grants began March 1, 2013, and will end February 29, 2016, and each is based on the companies included in the index on the respective grant dates.

Terms of stock options, performance-based stock units, and restricted stock units

Stock options and RSUs were issued to our named executive officers during fiscal year 2013 under our 2009 incentive award plan. The plan requires that the exercise price of options equals the fair market value on the day of the grant, as measured by the closing price of our common stock on the NYSE on the grant date. In connection with the introduction of PSU awards in fiscal year 2013, we also generally reduced the vesting period from four to three years for RSUs and stock options granted to our named executive officers, to offset the increased deferral and downside risk from the shift to PSUs. Beginning in fiscal year 2013, stock options and RSUs granted to named executive officers during the November 2012 annual grant process are exercisable 33% per year on November 11^th of each year after the grant date.

The additional stock option grants to Messrs. Farrell and Hollingshead on March 1, 2013, in connection with their promotions, continued to have a four-year vesting period and will vest 25% on each annual anniversary. These grants were independent of PSU awards, and thus the committee thought it appropriate that the vesting be consistent with our historical four-year vesting periods. Mr. Douglas’

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March 1, 2013, stock option grant was made in conjunction with a performance-based stock unit award and vests over three years, on each annual anniversary. Similarly, Mr. Farrell’s March 1, 2013 restricted stock grant was made in conjunction with a PSU award and vests over three years on each annual anniversary.

PSUs cliff-vest after the third anniversary of the grant, and to the extent the committee certifies the performance criteria have been met. In addition, as discussed below, vesting for our equity awards is automatically accelerated on a change of control, death, or permanent disability. Accelerated vesting upon permanent disability was added to all outstanding and new grants of options and RSUs in fiscal 2013 as the committee believed that acceleration in that situation is a common market practice and appropriate to provide additional economic benefits to employees and their families in what is likely to be a time of need. After vesting, our named executive officers may exercise options for a maximum period of the earlier of: (1) expiration of the grant (generally seven years after the date of grant), or (2) one year after separation for any reason (except six months after death in the case of non-US participants).

Equity compensation award policies

The committee’s policy is to generally have its annual incentive award grants to named executive officers and non-executive management effective on or about the annual stockholders meeting date. However, it reserves the right to make exceptions and change the policy. In setting this policy the committee considered many factors, including the alignment of this date with the election of directors and the traditional October 1 salary adjustment date. This enables management and the committee to combine the salary review process with the equity grant process for consistency and administrative convenience and to make awards only after performance in the previous year is known and current year budgets and goals are set. Also, given our traditional earnings release date in late October or early November, the stockholders meeting is likely to occur in an open window period. In addition, the stockholders meeting date is set and announced several months in advance, providing transparency to the process. Based on these reasons, the committee has set the annual stockholders meeting date as the target for our annual equity grants, although the actual grant date (i.e., the date when the committee takes formal action to make the grants) may vary by a few days from the annual meeting date due to administrative or other factors. The exercise price for options included in the equity grants equals the closing price of our common stock on the actual grant date.

The committee’s policy on granting incentive awards for promotions, new hire and other special situations is that the grants must be properly approved in advance of, or on the grant date, and the grant date is to occur on the first business day of the month following the promotion, new hire or other special situation; unless the event occurs on the first business day of the month, in which case the grant may be made as of that day. The committee has delegated authority to our chief executive officer and our chief administrative officer and global general counsel to make grants in connection with new hires, promotions, or special situations, provided that the grants are not to executive officers, and are consistent with other practices relating to our equity award program. In fiscal year 2013, our officers approved grants of an aggregate amount of 148,300 option equivalents to individuals under this delegation. RSUs are available for these grants, depending on the recipient’s position, and represented 140,559 option equivalents of the 148,300 option equivalents.

Equity ownership guidelines

In August 2010, after reviewing industry trends and competitive comparisons, the committee approved equity share ownership guidelines for our executive officers in an effort to continue to improve alignment of stockholder and management interest, and to conform to prevalent peer practices. These guidelines require our chief executive officer to achieve stock ownership levels, including vested and unvested RSUs, in ResMed common stock of at least three times his annual base salary within five

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years. All other named executive officers are required to own at least one and one-half times their respective annual salaries within five years. If these guidelines are not met, upon vesting of RSUs or option exercise, the officer must retain shares equal to 50% of the after-tax value of shares acquired on the vesting or exercise until the officer’s guidelines are met. As of August 2013, each of our named executive officers met their ownership guideline.

Change of control and termination arrangements

None of our named executive officers serving at the end of fiscal year 2013 has a contractual right to receive severance payments if employment is terminated, except in the event of certain change of control events, described below.

Equity award agreements.