def14a
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
(Amendment No. )
Filed by the Registrant þ
Filed by a Party other than the Registrant o
Check the appropriate box:
o Preliminary Proxy Statement
o Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
þ Definitive Proxy Statement
o Definitive Additional Materials
o Soliciting
Material Pursuant to Section 240.14a-12.
BURGER
KING HOLDINGS, 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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No fee required. |
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Fee computed on the table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
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Per unit price or other underlying value of transaction computed pursuant to Exchange
Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined): |
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Fee paid previously with preliminary materials. |
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Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the form or schedule and the
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Form, Schedule or Registration Statement No.:
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Date Filed:
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BURGER
KING HOLDINGS, INC.
5505 BLUE LAGOON DRIVE
MIAMI, FLORIDA 33126
October 8, 2009
Dear Shareholder:
It is my pleasure to invite you to the Annual Meeting of
Shareholders of Burger King Holdings, Inc. to be held on
November 19, 2009 at 9:00 a.m., Eastern Standard Time
at the Hilton Miami Airport, 5101 Blue Lagoon Drive, Miami, FL
33126. The Notice of the Annual Meeting and proxy statement
provide information concerning the matters to be considered at
the Annual Meeting. The Annual Meeting will cover only the
business contained in the proxy statement.
We are primarily furnishing proxy materials to our shareholders
on the Internet rather than mailing paper copies of the
materials to each shareholder. As a result, most of you will
receive an Important Notice Regarding Availability of Proxy
Materials instead of paper copies of this proxy statement and
our annual report on
Form 10-K.
The notice contains instructions on how to access the proxy
statement and the annual report over the Internet, as well as
instructions on how to request a paper copy of our proxy
materials, if you so desire. We believe that this process will
reduce the environmental impact and lower the costs of printing
and distributing our proxy materials.
We look forward to seeing you at the meeting.
Best regards,
John W. Chidsey
Chairman and Chief Executive Officer
BURGER
KING HOLDINGS, INC.
5505 BLUE LAGOON DRIVE
MIAMI, FLORIDA 33126
NOTICE OF 2009 ANNUAL MEETING
OF SHAREHOLDERS
TO BE HELD NOVEMBER 19,
2009
The annual meeting of shareholders of Burger King Holdings,
Inc., a Delaware corporation (the Company), will be
held at the Hilton Miami Airport, 5101 Blue Lagoon Drive, Miami,
Florida 33126 on Thursday, November 19, 2009 at
9:00 a.m., Eastern Standard Time (EST).
The meeting will be held for the following purposes:
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To elect nine (9) directors for a term to expire at the
2010 annual meeting of shareholders; and
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To ratify the selection of KPMG LLP (KPMG) as the
independent registered public accounting firm for the Company
for the fiscal year ending June 30, 2010 (fiscal
2010).
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The Board of Directors has fixed the close of business on
September 22, 2009 as the record date for determining
shareholders entitled to notice of and to vote at the meeting.
Please consider the proposals presented in the proxy
statement and vote your shares as promptly as possible.
By Order of the Board of Directors,
Anne Chwat
General Counsel and Secretary
Miami, Florida
October 8, 2009
TABLE OF
CONTENTS
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BURGER
KING HOLDINGS, INC.
5505 BLUE LAGOON DRIVE
MIAMI, FLORIDA 33126
PROXY
STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
To Be Held On November 19, 2009
ANNUAL
MEETING INFORMATION
This proxy statement contains information related to the annual
meeting of shareholders of Burger King Holdings, Inc.
(Burger King Holdings or the Company) to
be held on Thursday, November 19, 2009 at 9:00 a.m.
(EST) at the Hilton Miami Airport, 5101 Blue Lagoon Drive,
Miami, Florida 33126. This proxy statement was prepared under
the direction of our Board of Directors (the Board of
Directors or the Board) to solicit your proxy
for use at the annual meeting. The notice of this meeting will
be mailed or made accessible via the Internet to shareholders on
or about October 8, 2009.
Why
didnt I receive paper copies of the proxy materials in the
mail?
We are now primarily furnishing proxy materials to our
shareholders on the Internet, rather than mailing paper copies
of the proxy statement and the annual report on
Form 10-K
to each shareholder. If you received only an Important Notice
Regarding the Availability of Proxy Materials (the
Notice) by mail, you will not receive a paper copy
of these proxy materials unless you request one. Instead, the
Notice will instruct you on how to access the proxy statement
and annual report on
Form 10-K
via the Internet and how you may vote your shares. The Notice
will also instruct you as to how you may access your proxy card
to vote over the Internet. If you received a Notice by mail or
electronic mail and would like to receive a paper copy of our
proxy materials, free of charge, please follow the instructions
included in the Notice. We believe that this process will reduce
the environmental impact and lower the costs of printing and
distributing our proxy materials.
Who
may attend the annual meeting?
All shareholders of record at the close of business on
September 22, 2009 (the Record Date), or their
duly appointed proxies, and our invited guests may attend the
meeting. Seating is limited and admission is on a first-come,
first-served basis. Please be prepared to present valid photo
identification for admission to the meeting.
If you hold shares in street name (that is, in a
brokerage account or through a bank or other nominee) and you
plan to vote in person at the annual meeting, you will need to
bring valid photo identification and a copy of a statement
reflecting your share ownership as of the Record Date, or a
legal proxy from your broker or nominee.
Shareholders of record will be verified against an official list
available in the registration area at the meeting. We reserve
the right to deny admittance to anyone who cannot adequately
show proof of share ownership as of the Record Date.
When
will the shareholders list be available for
examination?
A complete list of the shareholders of record as of the Record
Date will be available for examination by shareholders of record
beginning October 17, 2009 at the Companys
headquarters and will continue to be available through and
during the meeting at the Hilton Miami Airport.
1
Who
may vote?
You may vote if you owned our common stock as of the close of
business on the Record Date. Each share of our common stock is
entitled to one vote. As of the Record Date, there were
135,175,219 shares of common stock outstanding and entitled
to vote at the annual meeting.
What
will I be voting on?
You will be voting on the following:
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The election of nine (9) directors for a term to expire at
the 2010 annual meeting of shareholders; and
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The ratification of the selection of KPMG as our independent
registered public accounting firm for fiscal 2010.
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What
are the voting recommendations of the Board of
Directors?
The Board of Directors recommends that you vote your shares
FOR each of the nominees named in this proxy
statement for election to the Board and FOR
ratification of the selection of KPMG as our independent
registered public accounting firm for fiscal 2010.
How do
I vote?
If you are a holder of record (that is, if your shares are
registered in your name with The Bank of New York Mellon, our
transfer agent (the Transfer Agent)), there are four
ways to vote:
Telephone Voting: You may vote by
calling the toll-free telephone number indicated on the Notice,
or if you received a proxy card, by following the instructions
on the proxy card. Please follow the voice prompts that allow
you to vote your shares and confirm that your instructions have
been properly recorded.
Internet Voting: You may vote by
logging on to the website indicated on the Notice, or if you
received a proxy card, by following the instructions on the
proxy card. Please follow the website prompts that allow you to
vote your shares and confirm that your instructions have been
properly recorded.
Return Your Proxy Card By Mail: If you
received your proxy materials by mail, you may vote by
completing, signing and returning the proxy card in the
postage-paid envelope provided with this proxy statement. The
proxy holders will vote your shares according to your
directions. If you sign and return your proxy card without
specifying choices, your shares will be voted by the persons
named in the proxy in accordance with the recommendations of the
Board of Directors as set forth in this proxy statement.
Vote at the Meeting: You may cast your
vote in person at the annual meeting. Written ballots will be
passed out to shareholders or legal proxies who want to vote in
person at the meeting.
Telephone and Internet voting for shareholders of record will be
available 24 hours a day and will close at 11:59 p.m.
(EST) on November 18, 2009. Internet or telephone voting is
convenient, provides postage and mailing cost savings and is
recorded immediately, minimizing the risk that postal delays may
cause votes to arrive late and therefore not be counted.
Even if you plan to attend the meeting, you are encouraged to
vote your shares by proxy. You may still vote your shares in
person at the meeting even if you have previously voted by
proxy. If you are present at the meeting and desire to vote in
person, your previous vote by proxy will not be counted.
What
if I hold my shares in street name?
You should follow the voting directions provided by your broker
or nominee. You may complete and mail a voting instruction card
to your broker or nominee or, in most cases, submit voting
instructions by telephone or the Internet to your broker or
nominee. If you provide specific voting instructions by mail,
telephone or the Internet, your broker or nominee will vote your
shares as you have directed.
2
Can I
change my mind after I vote?
Yes. If you are a shareholder of record, you may change your
vote or revoke your proxy at any time before it is voted at the
annual meeting by:
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submitting a new proxy by telephone or via the Internet after
the date of the earlier voted proxy;
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signing another proxy card with a later date and returning it to
us prior to the meeting; or
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attending the annual meeting and voting in person.
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If you hold your shares in street name, you may submit new
voting instructions by contacting your broker, bank or other
nominee. You may also vote in person at the annual meeting if
you obtain a legal proxy from your broker, bank or other nominee.
Who
will count the votes?
A representative of Mediant Communications, Inc. will count the
votes and will serve as the independent inspector of elections.
What
does it mean if I receive more than one proxy
card?
It means that you have multiple accounts with brokers or the
Transfer Agent. Please vote all of these shares. We encourage
you to register all of your shares in the same name and address.
You may do this by contacting your broker or the Transfer Agent.
The Transfer Agent may be reached at
1-800-524-4458
or at the following address:
The Bank of New York Mellon
Shareowner Services
Church Street Station
P.O. Box 11258
New York, NY
10286-1258
Will
my shares be voted if I do not provide my proxy?
If you are the shareholder of record and you do not vote or
provide a proxy, your shares will not be voted.
Your shares may be voted if they are held in street name, even
if you do not provide the brokerage firm with voting
instructions. Currently, brokerage firms have the authority
under the New York Stock Exchange (NYSE) rules to
vote shares for which their customers do not provide voting
instructions on certain routine matters.
The election of directors and the proposal to ratify the
selection of KPMG as our independent registered public
accounting firm for fiscal 2010 are considered
routine matters for which brokerage firms may vote
unvoted shares. There are currently no other proposals to be
voted on at the annual meeting.
May
shareholders ask questions?
Yes. Our representatives will answer shareholders
questions of general interest following the meeting consistent
with the rules distributed at the meeting.
How
many votes must be present to hold the meeting?
A majority of the outstanding shares entitled to vote at the
annual meeting, represented in person or by proxy, will
constitute a quorum. Shares of common stock represented in
person or by proxy, including shares which abstain or do not
vote with respect to one or more of the matters presented for
shareholder approval, will be counted for purposes of
determining whether a quorum is present.
3
What
vote is required to approve each proposal?
In accordance with our bylaws, the nominees for director
receiving the highest number of votes cast in person or by proxy
at the annual meeting (also referred to as a plurality of the
votes cast) will be elected. If you mark your proxy to withhold
your vote for a particular nominee on your proxy card, your vote
will not count either for or against the
nominee. The ratification of the selection of KPMG as our
independent registered public accounting firm for fiscal 2010
requires the affirmative vote of a majority of the votes cast at
the annual meeting in order to be approved.
Shares that abstain from voting as to a particular matter will
not be counted as votes in favor of such matter, and also will
not be counted as votes cast or shares voting on such matter.
Accordingly, abstentions will not be included in vote totals and
will not affect the outcome of the voting for either proposal.
Who
will pay for this proxy solicitation?
We will bear the cost of preparing, assembling and mailing the
proxy material and of reimbursing brokers, nominees, fiduciaries
and other custodians for
out-of-pocket
and clerical expenses of transmitting copies of the proxy
material to the beneficial owners of our shares. A few of our
officers and employees may participate in the solicitation of
proxies without additional compensation.
Will
any other matters be voted on at the annual
meeting?
As of the date of this proxy statement, our management knows of
no other matter that will be presented for consideration at the
meeting other than those matters discussed in this proxy
statement.
What
is the Companys website address?
Our website address is www.bk.com. We make this proxy
statement, our annual report on
Form 10-K,
quarterly reports on
Form 10-Q,
current reports on
Form 8-K
and amendments to those reports filed or furnished pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of
1934, as amended (the Exchange Act) available on our
website in the Investor Relations-SEC Filings section, as soon
as reasonably practicable after electronically filing such
material with the Securities and Exchange Commission
(SEC).
This information is also available free of charge at
www.sec.gov, an Internet site maintained by the SEC that
contains reports, proxy and information statements, and other
information regarding issuers that are filed electronically with
the SEC. Shareholders may also read and copy any reports,
statements and other information filed by us with the SEC at the
SEC public reference room at 100 F Street,
N.E., Room 1580, Washington, D.C. 20549. Please
call the SEC at
1-800-SEC-0330
or visit the SECs website for further information on its
public reference room. In addition, shareholders may obtain free
copies of the documents filed with the SEC by contacting our
Investor Relations department at
305-378-7696
or by sending a written request to Burger King Holdings, Inc.,
Investor Relations, 5505 Blue Lagoon Drive, Miami, Florida 33126.
The references to our website address and the SECs website
address do not constitute incorporation by reference of the
information contained in these websites and should not be
considered part of this document.
Our Corporate Governance Guidelines (including the director
independence standards set forth in Annex A), Code of
Business Ethics and Conduct, Code of Ethics for Executive
Officers, Code of Conduct for Directors and Code of Business
Ethics and Conduct for Vendors are located in the Investor
Relations-Corporate Governance section of our website.
Amendments to these documents or waivers related to our codes of
conduct will be made available on our website as soon as
reasonably practicable after the effective date of the changes.
The charters for our Audit Committee, Compensation Committee,
Nominating and Corporate Governance Committee and Executive
Committee are also located in the Investor Relations
Corporate Governance section of our website. These documents, as
well as our SEC filings, are available in print to any
shareholder who requests a copy at the phone number or address
listed above.
4
CORPORATE
GOVERNANCE PRINCIPLES, COMMITTEES AND DIRECTOR
INFORMATION
Director
Independence
The NYSE listing standards require that a majority of the
members of our Board of Directors be independent and that our
Audit Committee, Compensation Committee and Nominating and
Corporate Governance Committee be composed of only independent
directors. As of November 19, 2008, each of those
committees was and continues to be composed entirely of
independent directors.
The Board of Directors is responsible for determining the
independence of our directors. Under the NYSE listing standards,
a director qualifies as independent if the Board of Directors
affirmatively determines that the director has no material
relationship with us. While the focus of the inquiry is
independence from management, the Board is required to broadly
consider all relevant facts and circumstances in making an
independence determination. The NYSE listing standards permit
the Board to adopt and disclose standards to assist the Board in
making determinations of independence. Accordingly, the Board
has adopted, as a part of our Corporate Governance Guidelines,
director independence standards to assist it in making
independence determinations. The Board also considers the
recommendations of the Nominating and Corporate Governance
Committee which reviews information disclosed by the directors
on annual director and officer (D&O)
questionnaires prepared by us and completed by the directors.
This year our Board conducted evaluations of Richard W. Boyce,
David A. Brandon, Ronald M. Dykes, Peter R. Formanek, Manuel A.
Garcia, Sanjeev K. Mehra, Stephen G. Pagliuca, Brian T.
Swette and Kneeland C. Youngblood under the NYSE listing
standards and the director independence standards set forth in
our Corporate Governance Guidelines (collectively, the
Independence Standards) and other applicable
independence standards as described below. The Board
affirmatively determined that each of Messrs. Boyce,
Brandon, Dykes, Formanek, Garcia, Mehra, Pagliuca, Swette and
Youngblood is independent. As previously disclosed in a
Form 8-K
filed on September 23, 2009, Mr. Pagliuca resigned
from the Board effective September 21, 2009 and is
consequently not standing for re-election. As a result, there is
currently a vacancy on the Board that will be filled by Bain
Capital Partners pursuant to the Shareholders Agreement
described under Corporate Governance Principles
below.
In conducting its evaluations of Messrs. Brandon, Dykes,
Formanek, Swette and Youngblood, the Board determined that none
of these directors has a direct or indirect material
relationship with us and that each satisfies the Independence
Standards. In connection with determining Mr. Garcias
independence, the Board considered lease payments paid by our
subsidiary Burger King Corporation to Mr. Garcias
sister. Our Board determined that the receipt of lease payments
by Mr. Garcias sister does not constitute a direct or
indirect material relationship with us and that Mr. Garcia
satisfies the Independence Standards discussed above.
In conducting its evaluations of Messrs. Boyce, Mehra and
Pagliuca, the Board determined that none of these directors has
a direct or indirect material relationship with us and that each
satisfies the Independence Standards. In making its
determinations the Board considered Messrs. Boyce, Mehra
and Pagliucas positions with TPG Capital, Goldman
Sachs & Co, and Bain Capital Partners, respectively;
the Shareholders Agreement with the private equity funds
controlled by TPG Capital, Bain Capital Partners and the Goldman
Sachs Funds (collectively, the Sponsors); and other
related person transactions involving Goldman, Sachs &
Co. and the Sponsors previously disclosed in our SEC filings. As
a result of this evaluation and the recommendation of the
Nominating and Corporate Governance Committee, the Board
affirmatively determined that Messrs. Boyce, Mehra and
Pagliuca do not have any direct or indirect material
relationship with us and satisfy the Independence Standards.
Since Messrs. Dykes, Formanek and Garcia serve on our Audit
Committee, the Board also considered whether they satisfied the
independence standards mandated by Section 301 of the
Sarbanes-Oxley Act and those set forth in
Rule 10A-3
of the Exchange Act, which we refer to as the Audit Committee
Independence Standards. Our Board also considered the
recommendation of the Nominating and Corporate Governance
Committee. As a result of this evaluation and the recommendation
of the Nominating and Corporate Governance Committee, our Board
affirmatively determined that Messrs. Dykes, Formanek and
Garcia are independent under the Audit Committee Independence
Standards.
5
Corporate
Governance Principles
Our Board of Directors has adopted Corporate Governance
Guidelines (the Guidelines) to assist the Board in
exercising its responsibilities. The Guidelines are reviewed and
revised by the Board as it deems necessary and appropriate and
were last revised on November 20, 2008. The Guidelines and
the charter for each of the standing committees of the Board are
posted on our website at www.bk.com in the Company
Info Investor Relations section and are available in
print to any shareholder who requests a copy at the phone number
or address listed above under Annual Meeting
Information What is the Companys website
address?
The Guidelines and the charter for the Nominating and Corporate
Governance Committee set forth our policies with respect to
Board composition, membership qualifications, responsibilities,
size, management oversight, committees and operations. The
Nominating and Corporate Governance Committee considers the
following criteria when recommending nominees for director: high
personal and professional ethics, integrity and values;
expertise that is useful to us and complementary to the
background and experience of the other members of the Board;
ability to devote the time necessary for the diligent
performance of duties and responsibilities of Board membership;
willingness to represent the long-term interests of all
shareholders and objectively appraise managements
performance; possession of sound judgment to provide prudent
guidance with respect to the operations and interests of the
Company; and diversity and other relevant factors as the Board
may determine. The Nominating and Corporate Governance Committee
considers possible candidates from many sources for nominees for
director, including from management and shareholders. The
committee considers nominees recommended by shareholders,
provided that the shareholder complies with the procedure set
forth in our bylaws which is described in Advance Notice
Requirements for Shareholder Submission of Nominations and
Proposals in this proxy statement. Other than the
submission requirements set forth in our bylaws, there is no
difference in the manner in which the Nominating and Corporate
Governance Committee evaluates a nominee for director
recommended by a shareholder.
We are subject to a Shareholders Agreement with the
private equity funds controlled by the Sponsors. The
Shareholders Agreement provides for (i) the right of
each Sponsor to appoint two members to our Board, (ii) the
right of each Sponsor, with respect to each committee of the
Board other than the Audit Committee, to have at least one
Sponsor director on each committee, and (iii) Sponsor
directors to constitute a majority of the membership of each
committee and for the chairman of each committee to be a Sponsor
director, to the extent that such directors are permitted to
serve on such committees under SEC and NYSE rules applicable to
the Company. See Board Committees for more
information on the composition of each of the Board committees
and see Certain Relationships and Related Person
Transactions for more information on the
Shareholders Agreement, including the stock ownership
thresholds required to be maintained by the private equity funds
controlled by the Sponsors in order for them to retain these
Board of Director and Board committee appointment rights.
Although each Sponsor has elected to limit its representation to
one seat, each Sponsor retains the right to appoint two
directors to the Board. As of September 22, 2009, the
private equity funds controlled by the Sponsors owned
approximately 32% of the Companys common stock.
The non-management directors regularly schedule executive
sessions of the Board and each of the committees in which
management does not participate. The Chairmen of the Audit,
Compensation and Nominating and Corporate Governance Committees
lead executive session discussions on matters within the purview
of those committees.
Communication
with Directors
Shareholders and other parties interested in communicating
directly with the Chairman of the Board or with the
non-management directors may do so by writing to: Chairman of
the Board,
c/o Anne
Chwat, General Counsel and Secretary, Burger King Holdings,
Inc., 5505 Blue Lagoon Drive Miami, FL 33126. All communications
should include the name, address, telephone number and email
address (if any) of the person submitting the communication and
indicate whether the person is a shareholder of the Company.
The Board has approved a process for handling correspondence
received by the Company and addressed to the Chairman or to
non-management members of the Board. Under that process, the
General Counsel and
6
Secretary of the Company reviews all such correspondence and
maintains a log of and forwards copies of correspondence that,
in the opinion of the General Counsel and Secretary, deals with
the functions of the Board or committees thereof or that she
otherwise determines requires their attention. The General
Counsel and Secretary may screen frivolous or unlawful
communications and commercial advertisements. Directors may
review the log maintained by the General Counsel and Secretary
at any time.
Concerns relating to accounting, internal controls or auditing
matters are immediately brought to the attention of the
Companys internal audit department and handled in
accordance with procedures established by the Audit Committee
with respect to such matters.
Board and
Committee Meeting Attendance and Annual Shareholders Meeting
Attendance
The Board held four meetings during the fiscal year ended
June 30, 2009 (fiscal 2009). Each director
attended at least 75% of the aggregate of (a) the total
number of meetings of the Board during fiscal 2009, and
(b) the total number of meetings held by all committees of
the Board on which the directors served during fiscal 2009.
Although we do not have a specific policy regarding director
attendance at our annual meeting of shareholders, all directors
are encouraged to attend. We do so by, among other things,
holding our annual meeting of shareholders on the same date as
one of the Board meetings. All of our directors, except Sanjeev
K. Mehra, attended the 2008 annual meeting of shareholders.
Board
Committees
The Board of Directors has established an Audit Committee, a
Compensation Committee, a Nominating and Corporate Governance
Committee and an Executive Committee. The members of each
committee are appointed by the Board of Directors and serve one
year terms. Each committee has established a written charter
which sets forth the committees purpose, membership
criteria, powers and responsibilities and provides for the
annual evaluation of the committees performance. The
charters for the Audit Committee, the Nominating and Corporate
Governance Committee and the Compensation Committee were last
revised on November 20, 2008. The charter for the Executive
Committee was last revised on November 7, 2007. Copies of
all of our committee charters are available on our website at
www.bk.com in the Investor Relations-Corporate
Governance section and are available in print to any shareholder
who requests a copy at the phone number or address listed above
under Annual Meeting Information What is the
Companys website address?
Audit
Committee
The Audit Committee assists the Board in its oversight of
(i) the integrity of our financial statements,
(ii) the qualifications, independence and performance of
our independent registered public accounting firm,
(iii) the performance of our internal audit function, and
(iv) compliance by us with legal and regulatory
requirements and our compliance program. The Audit Committee is
responsible for the appointment, compensation, retention and
oversight of the work of our independent registered public
accounting firm.
The current members of the Audit Committee are
Messrs. Ronald M. Dykes (Chairman), Peter R. Formanek and
Manuel A. Garcia. The Board of Directors has determined that
(i) Messrs. Dykes, Formanek and Garcia are independent
directors under the Independence Standards and the Audit
Committee Independence Standards, and (ii) all of the
members of the Audit Committee are financially
literate as defined by the NYSE rules. The Board of
Directors also has determined that Mr. Dykes possesses
financial management expertise under the NYSE rules
and qualifies as an audit committee financial expert
as defined by the applicable SEC regulations.
The Audit Committee held eight meetings in fiscal 2009.
7
Compensation
Committee
The Compensation Committee (i) sets our compensation
philosophy and oversees compensation and benefits policies
generally, including establishing, reviewing and making
recommendations with respect to any incentive compensation and
equity-based plans that are subject to approval by the Board of
Directors, (ii) oversees and sets the compensation and
benefits arrangements of our Chief Executive Officer, the CEO
Direct Reports (as defined in the Compensation Discussion and
Analysis or CD&A) and members of the Board of Directors,
(iii) evaluates the performance of the CEO and CEO Direct
Reports, and (iv) reviews our management succession plan.
The Compensation Committee has the authority under its charter
to engage the services of outside advisors, experts and others
to assist the Compensation Committee. In accordance with this
authority, the Compensation Committee has engaged Mercer Human
Resource Consulting, Inc. (Mercer), as an outside
compensation consultant, to advise the Compensation Committee on
matters related to director and executive compensation. Pursuant
to its engagement by the Compensation Committee, Mercer:
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advises the Committee Chairman on management proposals as
requested;
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assists the Committee Chairman in establishing the calendar and
agenda items for Committee meetings, reviews meeting materials
and attends Committee meetings;
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reviews the Companys total compensation philosophy, peer
group and competitive positioning for reasonableness and
appropriateness;
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reviews the Companys total executive compensation program
and advises the Compensation Committee of plans or practices
that might be changed to improve effectiveness;
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provides market data and recommendations on CEO compensation
without prior review by management except for necessary fact
checking;
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reviews draft Compensation Discussion & Analysis and
related tables for our proxy statement;
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proactively advises the Compensation Committee on best-practice
ideas for Board governance of executive compensation; and
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undertakes special projects at the request of the Committee
Chairman.
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Further details regarding the role that Mercer plays in our
executive compensation-setting practices and decisions are
provided in the CD&A. In addition, please refer to the
CD&A Role of Executives in Establishing
Compensation for a discussion regarding the role that
executive officers play in our executive compensation practices
and decisions.
The Compensation Committee may delegate its authority to
subcommittees or the Chairman of the Compensation Committee when
it deems appropriate and in our best interests. Additionally,
the charter provides that the Compensation Committee may
delegate to one or more of our officers the authority to make
grants under our incentive compensation or other equity-based
plans to any person other than the Chief Executive Officer, the
CEO Direct Reports (as defined in the CD&A) or any officer
covered by Section 16 of the Exchange Act (executive
officers). Further details are provided in the CD&A.
The current members of the Compensation Committee are
Messrs. Peter R. Formanek and Sanjeev K. Mehra.
Mr. Pagliuca served on the Compensation Committee as its
Chairman from July 1, 2008 until November 19, 2008.
From November 19, 2008 until June 30, 2009, the
Compensation Committee was composed of Messrs. Mehra
(Chairman) and Formanek. On July 1, 2009, the Board
determined that Mr. Pagliuca was independent under the
Independence Standards, and he was reappointed to the
Compensation Committee as its Chairman, effective July 1,
2009. On September 21, 2009, Mr. Pagliuca resigned
from the Board of Directors and the Compensation Committee. As
of the date of this proxy statement, the Board has not appointed
a new Chairman of the Compensation Committee.
The Compensation Committee held five meetings in fiscal 2009.
8
Nominating
and Corporate Governance Committee
The Nominating and Corporate Governance Committee has the
authority under its charter to (i) identify and recommend
potential candidates qualified to become board members, review
and evaluate current directors for re-nomination to the Board
and recommend directors for appointment or re-appointment to
board committees, (ii) make recommendations to the Board of
Directors as to independence determinations, (iii) assist
the Board of Directors in determining the skills and qualities
of individuals for Board membership, (iv) review the
composition of the Board of Directors to determine
appropriateness of adding or removing individuals, and
(v) review and assess the adequacy of, and oversee
compliance with, the Guidelines.
Please refer to Corporate Governance Principles
above for a discussion of the Nominating and Corporate
Governance Committees policy with regard to the
consideration of nominees for director, including the
consideration of nominees by shareholders and the criteria used
to evaluate nominees. Please refer to Shareholder
Proposals and Nominations for 2010 Annual Meeting
Advance Notice Requirements for Shareholder Submission of
Nominations and Proposals for a discussion of the
procedures that shareholders are required to follow in order to
submit nominees for consideration by the Nominating and
Corporate Governance Committee.
The current members of the Nominating and Corporate Governance
Committee are Messrs. Sanjeev K. Mehra (Chairman) and David
A. Brandon. Mr. Richard W. Boyce resigned from the
committee on November 19, 2008.
The Nominating and Corporate Governance Committee held two
meetings in fiscal 2009.
Executive
Committee
The Executive Committee has authority under its charter to
exercise the powers and rights of the Board and to take any
action that could be taken by the Board (except if prohibited by
applicable law or regulation) if the amounts associated with
such actions do not individually exceed $25 million.
The current members of the Executive Committee are
Messrs. Richard W. Boyce (Chairman), John W. Chidsey and
Sanjeev K. Mehra. Mr. Pagliuca was a member of the
Executive Committee until he resigned from the Board and the
Executive Committee on September 21, 2009.
The Executive Committee did not hold any meetings in fiscal 2009.
9
PROPOSAL 1. ELECTION
OF DIRECTORS
Our Amended and Restated Certificate of Incorporation provides
that the number of directors constituting the Board of Directors
shall not be fewer than three or more than 15, with the exact
number to be fixed by a resolution adopted by the affirmative
vote of a majority of the Board. The Board of Directors has
fixed the number of directors at 10, although only nine nominees
are seeking re-election to the Board. There is currently a
vacancy on the Board as a result of the resignation of Stephen
G. Pagliuca, effective September 21, 2009. The vacancy will
be filled by Bain Capital Partners pursuant to the
Shareholders Agreement described below under Certain
Relationships and Related Person Transactions
Shareholders Agreement. The term of office of each
director is one year, commencing at this annual meeting and
ending at the annual meeting of shareholders to be held in 2010.
Each director elected will continue in office until he resigns
or until a successor has been elected and qualified.
John W. Chidsey, Richard W. Boyce, David A. Brandon, Ronald M.
Dykes, Peter R. Formanek, Manuel A. Garcia, Sanjeev K. Mehra,
Brian T. Swette and Kneeland C. Youngblood currently serve as
directors and are the proposed nominees for election as
directors to serve for a one-year term expiring at the 2010
annual meeting of shareholders. Messrs. Boyce and Mehra
were appointed to the Board of Directors by TPG Capital and the
Goldman Sachs Funds, respectively, pursuant to the
Shareholders Agreement.
Each of the nominees has consented to serve if elected. If any
nominee should be unable to serve or will not serve for any
reason, the persons designated on the accompanying form of proxy
will vote in accordance with their judgment, but in no event
will proxies be voted for more than nine nominees for director.
We know of no reason why the nominees would not be able to serve
if elected.
NOMINEES
FOR ELECTION AT THIS MEETING
The following table sets forth the name, age, principal
occupation of, and other information regarding, each nominee for
election as a director of the Company:
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John W. Chidsey
Director since 2006
Age 47
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Mr. Chidsey has served as Chairman of our Board since July 1,
2008 and has served as Chief Executive Officer since April 2006.
From September 2005 until April 2006, he served as our President
and Chief Financial Officer and from June 2004 until September
2005, he was our President, North America. Mr. Chidsey joined us
as Executive Vice President, Chief Administrative and Financial
Officer in March 2004 and held that position until June 2004.
From January 1996 to March 2003, Mr. Chidsey served in
numerous positions at Cendant Corporation, including Chief
Executive Officer of the Vehicle Services Division and the
Financial Services Division. Mr. Chidsey is a director of
HealthSouth Corporation and is also a member of the Board of
Trustees of Davidson College.
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Richard W. Boyce
Director since 2002
Age 55
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Mr. Boyce has been a Partner of TPG Capital (formerly Texas
Pacific Group) based in San Francisco, California since
January 1997. Mr. Boyce is a director of LPL Investment
Holdings, Inc. (a holding company for one of the largest
brokerage firms in the U.S.).
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David A. Brandon
Director since 2003
Age 57
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Mr. Brandon is Chairman and CEO of Dominos Pizza, Inc. and
has served in that role since March 1999. Mr. Brandon is a
director of The TJX Companies (a retailer of apparel and home
fashions), Dominos Pizza, Inc. and Kaydon Corporation (a
designer and manufacturer of custom engineered performance
critical products).
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Ronald M. Dykes
Director since 2007
Age 62
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Mr. Dykes has been a director since April 2007. Mr. Dykes most
recently served as Chief Financial Officer of BellSouth
Corporation, a position he retired from in 2005. Prior to his
retirement, Mr. Dykes worked for BellSouth Corporation and its
predecessor entities in various capacities for over
34 years. Mr. Dykes is a director of American Tower
Corporation (an operator of wireless communication towers), and
from October 2000 through December 31, 2005, also served as a
director of Cingular Wireless, most recently as Chairman of the
Board.
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Peter R. Formanek
Director since 2003
Age 66
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Mr. Formanek has been a private investor since May 1994.
Mr. Formanek is a co-founder and retired President of
AutoZone, Inc.
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Manuel A. Garcia
Director since 2003
Age 66
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Mr. Garcia has served as President and Chief Executive Officer
of Atlantic Coast Management, Inc., an operator of various
restaurants in the Orlando, Florida area, since 1996. Mr. Garcia
is Chairman of the Board of Culinary Concepts, Inc. (a food
processing company) and is a member of the Board of Trustees of
Florida State University.
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Sanjeev K. Mehra
Director since 2002
Age 50
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Mr. Mehra has been with Goldman, Sachs & Co. in New York
City since 1986, and has been a Managing Director since 1996.
Mr. Mehra is a director of SunGard Capital Corp.
(SCC), SunGard Capital Corp. II (SCC
II), SCCs subsidiary, and SunGard Data Systems, Inc
(collectively, a software and processing solutions company),
ARAMARK Corporation (a provider of uniform and career apparel),
First Aviation Services, Inc. (a fixed base operator), Sigma
Electric Manufacturing Corp. (a manufacturer of custom electric
fittings), KAR Holdings, Inc. (a leading wholesaler of used
and salvage vehicles) and Hawker Beechcraft, Inc. (a
manufacturer of piston, turboprop and jet aircraft).
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Brian T. Swette
Director since 2003
Age 55
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Mr. Swette served as Non-Executive Chairman of our Board from
April 2006 to June 30, 2008. Mr. Swette served as Chief
Operating Officer of eBay from 1998 to 2002 and has been a
private investor since 2002. Mr. Swette is a director of Jamba,
Inc. (a chain of smoothie restaurants) and Shutterfly Inc. (an
Internet-based social expression and personal publishing
service). Mr. Swette is also a director of the following
private companies: The FRS Company (maker of nutraceutical
energy products), TheLadders.com (an online marketplace for
professional employees) and Care.com (an online source for
caregiver services).
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Kneeland C. Youngblood
Director since 2004
Age 53
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Mr. Youngblood is a founding partner of Pharos Capital Group,
L.L.C., a private equity firm focused on health care, business
services and opportunistic investments, and has served as
managing partner since January 1998. Mr. Youngblood is a
director of Starwood Hotels and Resorts Worldwide, Inc., Gap
Inc. and Energy Future Holdings (formerly TXU).
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE
FOR
THE ELECTION OF EACH OF THE ABOVE NOMINEES
11
PROPOSAL 2. RATIFICATION
OF THE SELECTION OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee has appointed KPMG to audit our financial
statements for fiscal 2010. For additional information regarding
our relationship with KPMG, please see the Audit Committee
Report below.
Although it is not required to submit this proposal to the
shareholders for approval, the Board believes it is desirable
that an expression of shareholder opinion be solicited and
presents the selection of the independent registered public
accounting firm to the shareholders for ratification. Even if
the selection of KPMG is ratified by the shareholders, the Audit
Committee in its discretion could decide to terminate the
engagement of KPMG and engage another firm if the committee
determines that this is necessary or desirable. In the event our
shareholders do not ratify the appointment of KPMG for fiscal
2010, the appointment will be reconsidered by the Audit
Committee.
A representative of KPMG is expected to attend the annual
meeting and will have an opportunity to make a statement if he
or she so desires. He or she will also be available to respond
to appropriate questions from our shareholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE
FOR
THE RATIFICATION OF THE SELECTION OF KPMG LLP
12
AUDIT
COMMITTEE REPORT
The Audit Committee has: (i) reviewed and discussed the
audited consolidated financial statements of the Company with
management; (ii) discussed with KPMG, the independent
registered public accounting firm, the matters required to be
discussed by Statement on Auditing Standards 61 (Communication
with Audit Committees), as modified or supplemented;
(iii) received the written disclosures and the letter from
KPMG required by the applicable requirements of the Public
Company Accounting Oversight Board regarding KPMGs
communications with the Audit Committee concerning independence;
and (iv) discussed with KPMG the firms independence.
The Audit Committee considered whether the provision of
non-audit services by KPMG was compatible with maintaining such
firms independence. After reviewing the services provided
by KPMG, including all non-audit services, the Audit Committee,
in accordance with its charter, appointed KPMG as the
independent registered public accounting firm of the Company.
Based on these reviews and discussions, the Audit Committee
recommended to the Board of Directors that the audited
consolidated financial statements be included in our Annual
Report on
Form 10-K
for fiscal 2009 for filing with the SEC.
Respectfully submitted,
THE AUDIT COMMITTEE
Ronald M. Dykes, Chairman
Peter R. Formanek
Manuel A. Garcia
August 19, 2009
13
AUDIT
FEES AND SERVICES
The following table sets forth fees for professional services
rendered by KPMG for the annual audit of our financial
statements for the years ended June 30, 2009 and 2008 and
fees billed for other services rendered by KPMG for such years.
There were no fees billed by KPMG for the years ended
June 30, 2009 and 2008 that would fall under the categories
of Tax Fees or All Other Fees.
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Fiscal Year
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Fee Category
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2009
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2008
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(In thousands)
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(In thousands)
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Audit Fees(1)
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$
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3,474
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$
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3,643
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Audit-Related Fees(2)
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120
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151
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Total Fees
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3,594
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3,794
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(1) |
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Annual audit fees primarily consist of fees for the audits of
the consolidated financial statements and the review of the
interim condensed quarterly consolidated financial statements.
This category also includes fees for statutory audits required
by the tax authorities of various countries and accounting
consultations and research work necessary to comply with
generally accepted accounting principles. In fiscal 2009 and
2008, audit fees also included amounts related to the audit of
the effectiveness of internal controls over financial reporting
and attestation services. In fiscal 2008, audit fees also
included amounts related to the delivery of comfort letters
associated with two secondary offerings of common stock held by
the private equity funds controlled by the Sponsors. |
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(2) |
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Audit-Related Fees primarily consist of the fees for financial
statement audits of our employee benefit plans, marketing fund
and gift card subsidiary. In fiscal 2008, audit-related fees
also included the fees for financial statement audits of a joint
venture that was dissolved on June 30, 2008. |
Pre-approval
Policy
Pursuant to its written charter, the Audit Committee
pre-approves all audit services and permitted non-audit services
to be performed by our independent registered public accounting
firm. The Audit Committee has adopted a pre-approval policy
under which the Audit Committee has delegated to its chairman
the authority to approve services valued at up to $50,000 per
engagement. All such decisions to pre-approve audit and
permitted non-audit services are presented to the full Audit
Committee at the next scheduled meeting.
All audit and permitted non-audit services and all fees
associated with such services performed by our independent
registered public accounting firm in fiscal 2009 were approved
by the full Audit Committee or approved by the chairman of the
Audit Committee consistent with the policy described above.
14
COMPENSATION
DISCUSSION AND ANALYSIS
Overview
This Compensation Discussion and Analysis
(CD&A) describes our compensation philosophy,
how the Compensation Committee establishes executive
compensation, the objectives of our various compensation
programs, how performance metrics are selected and evaluated for
the various components of our compensation programs and how the
performance of our CEO and other NEOs is evaluated and results
in the level of compensation awarded under the various
components of our compensation program.
As used in this CD&A, the following terms have the
following meanings:
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BKC is Burger King Corporation, a Florida
corporation;
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the CEO is our Chief Executive Officer, John W.
Chidsey, who also serves as Chairman of our Board of Directors;
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the NEOs are the following executives:
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John W. Chidsey, Chairman and CEO
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Ben K. Wells, Chief Financial Officer
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Russell B. Klein, President, Global Marketing,
Strategy & Innovation
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Charles M. Fallon, Jr., President, North America
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Peter B. Robinson, President, EMEA (Europe, Middle East and
Africa);
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the CEO Direct Reports are our executives who report
directly to the CEO. All of the NEOs (other than the CEO) are
CEO Direct Reports; and
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Total Direct Compensation is annual base salary,
cash incentives and long-term equity incentives.
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Our
Compensation Philosophy and Objectives
We believe that compensation is an important tool to further our
long-term goal of creating shareholder value. As such, our
compensation philosophy is based on
pay-for-performance
principles, which incorporate the Companys achievement of
specific financial goals as well as achievement by employees of
individual performance goals. Our compensation programs are
designed to support our business initiatives by:
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rewarding superior financial and operational performance;
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placing a significant portion of compensation at risk if
performance goals are not achieved;
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aligning the interests of the CEO and the CEO Direct Reports
with those of our shareholders; and
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enabling us to attract, retain and motivate top talent.
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Our compensation policies are aligned with our business
strategy. The key elements of our business strategy are:
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drive further sales growth;
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enhance restaurant profitability;
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employ innovative marketing strategies and offer products with
superior value and quality;
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expand our large international platform;
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accelerate new restaurant development and expansion; and
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drive growth through the strategic acquisition and sale of
restaurants.
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15
Our executive compensation program for all senior executives at
the Company, including the NEOs, consists of base salary, annual
cash incentives, long-term equity incentives and executive
benefits and perquisites. Annual cash and long-term equity
incentive programs reward our financial performance compared to
goals established for the year. Each year, the Compensation
Committee approves worldwide and regional financial goals for
these programs. We must achieve at least the minimum financial
goals with respect to the annual cash incentive program in order
for any payments to be made for that year. Moreover, if we fail
to achieve the target financial goal with respect to our
long-term equity incentive program, the number of shares of
performance-based restricted stock earned by the NEOs will be
subject to a decrease of up to 50%.
Individual performance objectives are established at the
beginning of each fiscal year for all of our employees,
including the NEOs. These individual performance objectives are
intended to support our business strategy and inclusion and
leadership development initiatives. Our inclusion and leadership
development initiatives are designed to reinforce the importance
of developing our employees, while respecting and embracing all
of the differences we bring to the BURGER
KING®
brand. The Compensation Committee recommends, and the Board
approves, individual performance objectives for the CEO each
fiscal year. The CEO then establishes individual performance
objectives for each CEO Direct Report, including the NEOs (other
than the CEO) based on the objectives that the Board has set for
the CEO. Performance against these pre-established objectives is
evaluated by the Compensation Committee following the end of
each fiscal year. The annual cash incentive for all participants
(assuming we have achieved at least our minimum financial goals)
and the long-term equity incentive for all participants other
than the CEO may be adjusted based on individual performance.
Oversight
of Executive Compensation Programs
Role of
Compensation Committee
The Compensation Committee is composed entirely of outside
directors and is responsible to the Board of Directors and our
shareholders for establishing and overseeing our compensation
philosophy and for overseeing our executive compensation
policies and programs generally. As part of this responsibility,
the Compensation Committee:
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administers our executive compensation programs;
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evaluates the performance of the CEO and the CEO Direct Reports;
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oversees and sets compensation for the CEO and the CEO Direct
Reports; and
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reviews our management succession plan.
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All decisions relating to the issuance of equity to our
executive officers were subject to review and approval by the
Board of Directors until July 1, 2009, at which time the
Compensation Committee met the independence requirements of
Rule 16b-3
of the Exchange Act. Effective July 1, 2009, decisions
relating to the issuance of equity to our executive officers
became subject to the sole review and approval by the
Compensation Committee. However, the Board of Directors approves
all compensation decisions relating to the CEO.
The Compensation Committees charter describes the
Compensation Committees responsibilities. The Compensation
Committee and the Board of Directors review the charter
annually. The charter was last revised on November 20, 2008.
Role of
Compensation Consultant
Under its charter, the Compensation Committee is authorized to
engage the services of outside advisors, experts and others.
Since November 28, 2006, the Compensation Committee has
engaged Mercer as an outside compensation consultant to advise
the Compensation Committee on matters related to executive
compensation. As discussed above under Corporate
Governance Principles, Committees and Director
Information Compensation Committee, the
Compensation Committee annually reviews the market intelligence
on compensation trends provided by Mercer and Mercers
general views on the specific compensation programs
16
designed by us. During fiscal 2009, Mercer assisted the
Compensation Committees executive compensation-setting
process by:
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Reviewing those companies that comprise our peer group and
advising the Compensation Committee on the appropriate levels of
adjustment necessary for comparative purposes;
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Providing a competitive analysis of Total Direct Compensation
for our CEO and the CEO Direct Reports against our peer group
(described below);
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Providing analysis and advice with respect to the evaluation of
the renewal of the employment agreements for our CEO and our CEO
Direct Reports and in establishing the terms of the compensation
package and employment agreement for our new President, EMEA;
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Assisting in the design of our compensation programs for
executives and Board members;
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Reviewing the effectiveness of our compensation programs,
including our annual and long-term incentive programs, against
those of our peer group;
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Providing data to support our current incentive plan parameters
and measures;
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Reviewing our compensation plans to ensure that the design for
fiscal 2010 will be competitive as compared to our industry and
peer group;
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Providing advice about compliance with Internal Revenue Code
(IRC) Section 409A;
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Reviewing the Compensation Committees fiscal 2009 calendar;
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Assisting in compliance with SEC disclosures regarding executive
compensation; and
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Reviewing this CD&A and the tables contained in this proxy
statement.
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In addition to providing services to the Compensation Committee,
Mercer also advises Company management on matters related to
broad-based compensation and provides Company management with
data on compensation practices outside the United States.
Peer
Group Comparison
To establish Total Direct Compensation levels for our CEO and
the CEO Direct Reports, the Compensation Committee compares our
compensation practices and Total Direct Compensation
opportunities with those of certain publicly-traded peer
companies selected by us. It also considers data reported in
various compensation surveys. In making determinations about
compensation, however, the Compensation Committee places greater
emphasis on the following factors specific to the relevant
individual and his or her role:
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performance and long-term potential;
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nature and scope of the individuals responsibilities and
his or her effectiveness in supporting our long-term
goals; and
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Total Direct Compensation of the individual in relation to other
CEO Direct Reports.
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We believe that the relative pay of each CEO Direct Report as
compared to the pay of each other CEO Direct Report and the CEO
is one factor of many to be considered in establishing
compensation for our CEO Direct Reports. We have not established
a policy regarding the numerical ratio of total compensation of
the CEO to that of the CEO Direct Reports, but do review
compensation levels to ensure that appropriate internal pay
equity exists. The difference between the CEOs
compensation and that of the CEO Direct Reports reflects the
significant difference in the nature and scope of their relative
responsibilities. The CEOs responsibilities for management
and oversight of a global enterprise are significantly higher
than those of the other executives. As a result, the CEOs
compensation is substantially higher than the compensation of
our CEO Direct Reports.
Our peer group is focused on other restaurant and franchise
companies. We also include companies in the broader consumer
products/services industry and companies with a strong global
footprint because we recruit
17
executive talent from a more diverse background and we consider
international growth to be a key driver of our success.
Additionally, as a highly franchised company, the complexity of
managing the overall
BURGER KING®
system may not be reflected in our actual revenue, so for peer
group purposes, we add 50% of the worldwide franchise sales of
our system to our total revenue numbers, thereby increasing our
annual revenue, for comparison purposes, to approximately
$8.1 billion in fiscal 2008. Taking into account this first
adjustment, our annual revenue is still less than the median of
the peer group. The median revenue for the peer group in
calendar year 2007 was $9.5 billion. Consequently, in
consultation with Mercer, we adjust the compensation data from
the peer group companies for differences in revenue to provide
comparable data for our analysis. We review the peer group and
make changes as we deem necessary on an annual basis. While the
Compensation Committee uses the adjusted compensation data from
our peer group as a reference point, it is not, and was not in
fiscal 2009, the determining factor in executive compensation
decisions. The adjusted compensation data is used primarily to
ensure that our executive compensation program as a whole is
competitive when the Company achieves targeted performance
levels.
For the fiscal 2009 analysis, the companies comprising the peer
group and their respective industry groups were:
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Peer Group Company
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GICS Industry Description
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Anheuser-Busch Companies, Inc.
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Beverages
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Brinker International, Inc.
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Hotels, Restaurants & Leisure
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Darden Restaurants, Inc.
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Hotels, Restaurants & Leisure
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Dominos Pizza, Inc.
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Hotels, Restaurants & Leisure
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Marriott International, Inc.
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Hotels, Restaurants & Leisure
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McDonalds Corp.
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Hotels, Restaurants & Leisure
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Nike, Inc.
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Textiles, Apparel & Luxury Goods
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PepsiCo. Inc.
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Beverages
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Starbucks Corp.
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Hotels, Restaurants & Leisure
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Starwood Hotels & Resorts Worldwide, Inc.
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Hotels, Restaurants & Leisure
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The
Coca-Cola
Company
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Beverages
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Wendys International, Inc.
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Hotels, Restaurants & Leisure
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Wyndham Worldwide Corp.
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Hotels, Restaurants & Leisure
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Yum! Brands, Inc.
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Hotels, Restaurants & Leisure
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Our peer group for fiscal 2008 was composed of the same
companies as those that we used in fiscal 2009, except that
Realogy Corp. was not included in our peer group for fiscal 2009
because the company ceased to be a publicly reporting company
during fiscal 2008. For fiscal 2010, the peer group is composed
of the same companies set forth above, except that
Anheuser-Busch Companies, Inc. and Wendys International,
Inc. are no longer included as these companies were acquired
during fiscal 2009 and are no longer publicly reporting
companies. However, the Compensation Committee decided to add
Wendys/Arbys Group, Inc., a public company and the
parent company of Wendys International, Inc., to our peer
group for fiscal 2010.
Role of
Executives in Establishing Compensation
Our Chief Human Resources Officer administers our retirement,
severance and other benefit plans and trusts, with oversight and
supervision by the Compensation Committee. In addition, our
Chief Human Resources Officer makes recommendations to the
Compensation Committee regarding job leveling and grading for
the CEO, the CEO Direct Reports and other senior level
employees. Our CEO and Compensation Committee work together to
review our management succession planning for these employees.
The CEO annually reviews the individual performance of each CEO
Direct Report and provides the Compensation Committee with
(i) evaluations of each CEO Direct Report, including an
evaluation of each persons performance against his or her
individual performance objectives and (ii) recommendations
regarding
18
any increase in each persons base salary level, the
individual performance rating for purposes of calculating his or
her annual cash incentive payment and any long-term equity award.
The CEO, Chief Human Resources Officer, General Counsel and Vice
President of Total Rewards attend Compensation Committee
meetings, although they leave the meetings during discussions
and deliberations of individual compensation actions affecting
them personally and during the Compensation Committees
executive sessions.
Elements
of Compensation and Benefit Programs
To achieve our policy goals, the Compensation Committee utilizes
the following components of compensation: base salary, annual
cash incentives, long-term equity incentives, benefits and
perquisites. Different elements of the total compensation
package serve different objectives. Competitive base salaries
and benefits are designed to attract and retain employees by
providing them with a stable source of income and security over
time. Annual cash incentives and long-term equity incentives are
performance-based and, in the case of annual cash incentives,
will only be paid if we achieve our minimum financial goals for
the fiscal year. Moreover, employees who contribute positively
towards our business strategy and inclusion and leadership
development initiatives can increase the amount of their annual
cash incentives and long-term equity incentives based on their
individual performance rating. However, the CEOs annual
equity incentive is not subject to adjustment based on
individual performance. The use of equity compensation supports
the objectives of encouraging stock ownership and aligning the
interests of the NEOs with those of our shareholders, as they
share in both the positive and negative stock price returns
experienced by our shareholders.
The only retirement programs we provide to our NEOs are the
ability to participate in BKCs 401(k) plan and the
Executive Retirement Program as described below in the
Executive Benefits and Perquisites section of this
CD&A.
The Compensation Committee uses Total Direct Compensation as its
measure when it determines the level and components of
compensation for the NEOs. The Compensation Committee reviews
the Total Direct Compensation of the NEOs using data provided by
Mercer and Company management. For the NEOs, the Compensation
Committee places more emphasis on the performance-based
components of Total Direct Compensation. For fiscal 2009, the
total target performance-based pay for the NEOs ranged from 68%
to 83% of their total compensation. Actual payments may vary for
the NEOs if the Company exceeds or fails to meet financial and
operational targets and may vary for an NEO if he exceeds or
fails to meet his individual objectives. The table below sets
forth the percentage of targeted and actual components of Total
Direct Compensation for the NEOs for fiscal 2009:
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Base Salary
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Annual Cash Incentive
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Long-Term Equity Incentive
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Name
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Target
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Actual
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Target
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Actual
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Target
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Actual
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John W. Chidsey
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17%
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17%
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17%
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14%
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66%
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69%
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Ben K. Wells
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32%
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33%
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22%
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18%
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46%
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49%
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Russell B. Klein
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27%
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27%
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21%
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18%
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52%
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55%
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Charles M. Fallon, Jr.
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32%
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32%
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22%
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16%
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46%
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52%
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Peter B. Robinson
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32%
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29%
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22%
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28%
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46%
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43%
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The CEOs variable pay as a percentage of total pay exceeds
that of the other NEOs due to the importance of aligning the
interests of the CEO with those of our shareholders and the
nature of the CEOs role and responsibilities as compared
to the other NEOs.
Our executive compensation program is designed to encourage and
reward behavior that promotes sustainable growth in stockholder
value through attainment of annual and long-term goals. For
example, our performance-based restricted stock awards are
subject to a three-year cliff vesting period, including a
one-year performance period. Consequently, executives are
incentivized to achieve annual financial targets in order to
maximize the number of shares of restricted stock that they will
actually receive. The vesting period also
19
encourages executives to consider long-term growth in making
decisions, as they will not be able to monetize the shares for
three years. We believe that this design limits speculative
rewards and inappropriate risk taking for short-term results.
Base
Salary
We provide base salaries to recognize the skills, competencies,
experience and individual performance that each NEO brings to
his position. The Compensation Committee annually reviews and
approves any changes to the base salary of the CEO and each
other NEO and submits the CEOs base salary to the Board of
Directors for approval. The Compensation Committee considers
various factors such as the relevant employment agreement, the
executives performance and responsibilities, leadership
and years of experience, competitive salaries within the
marketplace for similar positions, and his total compensation
package. For fiscal 2009, each NEO received a 3% increase in
base salary. In July 2009, the Compensation Committee decided to
forgo base salary increases for all executive officers
(including the NEOs) for fiscal 2010. This decision was made in
response to the continuing recessionary environment and the
Companys implementation of cost containment and other
strategies to more effectively operate in the current economic
environment. As a result, the NEOs did not receive an increase
in base salary for fiscal 2010 and their annual base salaries
for fiscal 2010 are unchanged from fiscal 2009.
Annual
Cash Incentive Program
The NEOs are eligible to receive an annual performance-based
cash bonus based on the Companys financial performance,
which can be adjusted by their individual performance.
Approximately 1,400 Company employees are eligible to
participate in this annual cash incentive program. For fiscal
2009, annual cash incentives were awarded under the BKC Fiscal
Year 2009 Restaurant Support Incentive Program (the
RSIP), which was implemented under our 2006 Omnibus
Incentive Plan. This annual cash incentive is calculated for
each eligible employee as a percentage of his or her base
salary, based on Company financial performance and as may be
adjusted for individual performance, as set forth below. We must
achieve at least the minimum financial goals established for a
fiscal year in order for any payments to be made for that year.
The formula for determining an eligible employees cash
incentive under the RSIP (the Payout Amount) is:
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Annual Base Salary
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X
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Target Bonus Percentage
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X
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Overall Business Performance Factor
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X
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Individual Performance Multiplier
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=
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Payout Amount
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Target Bonus Percentage: The employment
agreement for each NEO establishes the annual target cash bonus
opportunity or target bonus for the NEO, expressed as a
percentage of his then current base salary. The target bonus for
each NEO, expressed as a percentage of base salary, is as
follows:
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John W. Chidsey, 100%
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Ben K. Wells, 70%
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Russell B. Klein, 80%
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Charles M. Fallon, Jr., 70%
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Peter B. Robinson, 70%
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Due to the nature of the CEOs role and responsibilities,
the CEOs target bonus as a percentage of his base salary
is greater than that of the other NEOs.
Overall Business Performance Factor: The
Overall Business Performance Factor is based on two Company
financial performance measures which are equally weighted, as
follows:
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50% on worldwide Company performance, and
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50% on the Companys performance in the employees
geographic area of responsibility, which is either worldwide or
regional.
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20
Given the roles and worldwide scope of responsibility of
Messrs. Chidsey, Wells and Klein, the Overall Business
Performance Factor for those NEOs was measured on a 100%
worldwide basis. The Overall Business Performance Factor for
Messrs. Fallon and Robinson, who have regional
responsibilities, was measured 50% on a worldwide basis and 50%
on their geographic areas of responsibility, which are the North
America region for Mr. Fallon and the EMEA region for
Mr. Robinson.
Mr. Robinsons assignment as President, EMEA ended on
September 30, 2009 and, effective as of October 1,
2009, he was appointed Executive Vice President. As a result of
this change in his responsibilities, the Overall Business
Performance Factor used to calculate Mr. Robinsons
cash bonus for fiscal 2010 will be measured 50% on a worldwide
basis and 50% on the EMEA region for the period of July 1,
2009 through September 30, 2009 and 100% on a worldwide
basis for the period of October 1, 2009 through
June 30, 2010.
For fiscal 2009, the Compensation Committee chose EBITDA
(earnings before interest, taxes, depreciation and amortization)
as the measure used to determine the Overall Business
Performance Factor. EBITDA, which is a non-GAAP measure, is used
by our management as a supplemental internal measure for
planning and forecasting expectations in our business groups and
for evaluating actual results against such expectations. By
selecting EBITDA as the measure for our overall business
performance, it facilitates performance comparisons from period
to period. Furthermore, EBITDA is frequently used as a measure
of our financial performance by outside financial analysts and
investors and therefore is closely aligned with our
stockholders interests.
We establish worldwide and regional EBITDA targets and minimum
amounts which must be achieved in order for any payments to be
made under the RSIP. The following payouts for the NEOs may be
earned if we achieve the following performance levels:
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at the threshold performance level, a payout of 50%
of target bonus may be earned;
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at the target performance level, a payout of 100% of
target bonus may be earned; and
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at the maximum performance level, a payout of 200%
of target bonus may be earned.
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If the actual EBITDA amounts, as adjusted as set forth below
(Incentive EBITDA), fall between the threshold and
target performance levels, the Overall Business Performance
Factor would be between 50% and 100%, and if Incentive EBITDA
falls between the target and maximum performance levels, the
Overall Business Performance Factor would be between 100% and
200%. If Incentive EBITDA falls below the threshold performance
level, there would be no payout under the RSIP for that fiscal
year.
Our threshold performance level, target performance level and
maximum performance level under the RSIP are based on our
Board-approved budget and business plan for the upcoming fiscal
year and these performance levels as well as the Incentive
EBITDA were as follows for fiscal 2009 (all expressed as EBITDA):
FISCAL
2009 EBITDA PERFORMANCE LEVELS UNDER RSIP ($ in
millions)
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Fiscal 2009
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Fiscal 2009 Threshold
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Fiscal 2009 Target
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Fiscal 2009 Maximum
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Incentive
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Geographic Area
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Performance Level
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Performance Level
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Performance Level
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EBITDA
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Worldwide
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419
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493
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527
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458
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North America
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416
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489
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524
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442
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EBITDA for our EMEA/APAC reportable segment may be derived from
the segment financial results information that we provide in our
Form 10-K.
However, we do not disclose the financial results of the EMEA or
APAC regions separately as we believe that this would result in
competitive harm. The target EBITDA performance goals for each
of our markets, including EMEA, are set at the beginning of each
fiscal year with the intent of being challenging, but
achievable, while the maximum performance levels will be reached
only if we significantly exceed our financial goals. For the
fiscal years
2006-2009,
we achieved our EMEA threshold performance goals each year, our
EMEA target performance goals twice and our EMEA maximum
performance goal once. Our EBITDA performance goals are set
using forecasted currency exchange rates and
21
then adjusted at the end of the fiscal year to bring actual
results back to these forecasted rates, thereby eliminating any
benefit or detriment due to fluctuations in currency exchange
rates. Our EBITDA target performance goals are not necessarily
the same as that which we may, from time to time, include in our
worldwide earnings guidance. However, if worldwide EBITDA
guidance for a year is given, the worldwide EBITDA target
established at the beginning of the year is generally within the
initial range of earnings guidance that we announced for that
year.
For fiscal 2009, worldwide Incentive EBITDA and Incentive EBITDA
for the North America region fell between the threshold and
target performance levels. In calculating worldwide Incentive
EBITDA for fiscal 2009, the Compensation Committee used adjusted
EBITDA for fiscal 2009 as reported in our fiscal 2009 earnings
release furnished as an exhibit to the
Form 8-K
filed on August 25, 2009, and adjusted this amount to bring
actual results back to the forecasted currency exchange rates.
The Compensation Committee then subtracted gains from the sale
of certain assets and the reversal of over-accruals in the prior
fiscal year and added back certain unplanned costs associated
with wage increases in Germany. The Compensation Committee also
added back certain items that were one-time non-recurring
charges which the Compensation Committee determined were not
reflective of our overall financial performance, including costs
associated with centralizing and standardizing certain support
functions, the write-off of inventory containing phthalates and
the H1N1 flu pandemic. In fiscal 2009, our reported adjusted
EBITDA excluded the after tax effects of $1.5 million of
charges associated with the acquisition of franchise restaurants
primarily from a large franchisee in the U.S. and
$2.0 million of start up charges associated with acquired
restaurants. We exceeded our EBITDA maximum performance level
for the EMEA region in fiscal 2009.
In July 2009, the Compensation Committee approved using PBT
(profit before taxes) as the measure to determine the
Companys worldwide Company performance and EBITDA as the
measure to determine the Companys regional performance for
purposes of calculating the Overall Business Performance Factor
under the RSIP for fiscal 2010. The change was made to increase
managements focus on managing capital through operating
and financial decisions, as PBT holds management accountable for
controlling costs and increasing profits and is a key driver for
total shareholder return. PBT excludes the impact of taxes which
only a few employees have the ability to impact. For those
employees with regional responsibilities, the use of PBT
introduces a second measure for evaluating Company performance,
while preserving EBITDA as the measure for regional performance.
Individual Performance Multiplier: Assuming
that we have achieved at least the threshold financial
performance level established for a fiscal year, an eligible
employees annual cash incentive may be adjusted based on
individual performance. For fiscal 2009, our executives
individual performance was evaluated based on the achievement of
business objectives and inclusion and leadership development
objectives. For fiscal 2010, the Compensation Committee decided
to retain the same types of objectives to evaluate individual
performance that it used in fiscal 2009.
Individual Performance Multipliers range from 0 to 1.25, based
on an individuals performance rating. Individual
performance ratings are determined for each eligible employee at
the end of each fiscal year based on achievement of that
persons individual performance objectives. Individual
performance ratings are given on a scale of between 1 and 5,
with 5 being the highest possible rating.
If the Company achieves the Overall Business Performance Factor
at the maximum performance level, and the NEOs achieve the
highest individual performance rating, the annual cash bonus
earned by each of the NEOs would be as follows (expressed as a
percentage of base salary): Mr. Chidsey, 250%;
Mr. Klein, 200%; and Messrs. Wells, Fallon and
Robinson, 175%.
For fiscal 2009, the Compensation Committee evaluated the CEO
and reviewed the individual performance evaluations that the CEO
completed for each other NEO at the end of fiscal 2009. All of
the
22
NEOs rated Individual Performance Multipliers equal to 1.0. The
fiscal 2009 RSIP payout amounts for the NEOs are set forth in
the following table:
2009 RSIP
CASH BONUS
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Target Bonus as
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Annual
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Percentage of
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Percentage Payout
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Payout
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Name
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Base Pay ($)
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Base Salary
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(% of Base Salary)
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Amount ($)
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John W. Chidsey
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1,042,875
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100
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%
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77
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%
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803,014
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Ben K. Wells
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494,709
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70
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%
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54
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%
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266,648
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Russell B. Klein
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515,000
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80
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%
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62
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%
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317,240
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Charles M. Fallon, Jr.
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437,750
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70
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%
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51
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%
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222,158
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Peter B. Robinson
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463,500
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70
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%
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97
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%
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449,363
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Long-Term
Equity Incentives
We believe that long-term compensation is a critical component
of our executive compensation program as a way to foster a
long-term focus on our financial results. Long-term compensation
is an incentive tool that we and the Compensation Committee use
to align the financial interests of executives to the creation
of sustained shareholder value. We believe that equity
incentives are preferable to cash in a long-term plan design
because:
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the ultimate value is impacted by share price gains or losses,
linking executive returns to those of shareholders;
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equity incentives provide an opportunity for executives to
increase their stock ownership in us;
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once vested, stock options provide flexibility for executives in
deciding when to exercise their options and recognize
income; and
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equity incentives are a common form of pay in most publicly
traded companies, and we use these incentives to remain
competitive in attracting and retaining executives.
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The Compensation Committee has adopted an Equity Grant Policy
and the Board of Directors has adopted Stock Ownership
Guidelines. These policies are described below in the
Additional Features of our Executive Compensation
Programs section of this CD&A.
We award annual long-term equity incentives to the NEOs and
approximately 200 other executives. For the NEOs, these awards
represent the largest component of their Total Direct
Compensation. The Compensation Committee established individual
target awards for fiscal 2009 based on the executives
level, base salary, and for all NEOs other than the CEO, on
individual performance during fiscal 2008. As with the 2009
RSIP, our executives individual performance was evaluated
based on the achievement of business objectives and inclusion
and leadership development objectives. Pursuant to his
employment agreement, the CEOs target award is not subject
to adjustment based on his individual performance. For fiscal
2009, the target equity awards for the NEOs, after application
of the Individual Performance Multiplier and as a percentage of
their base salary were: Mr. Chidsey, 400%; Mr. Klein,
200%; Mr. Fallon, 165%; and Messrs. Wells and Robinson
150%. Individual target grants for fiscal 2009 were awarded on
August 22, 2008.
For fiscal 2009, the Compensation Committee decided to award a
combination of equity grants, with 50% of the value earned paid
in the form of stock options and 50% of the value earned paid in
the form of performance-based restricted stock awards. This was
the same equity mix determined by the Compensation Committee for
fiscal 2008. The fiscal 2009 performance-based restricted stock
awards will vest 100% on the third anniversary of the grant
date, and the fiscal 2009 option awards will vest ratably over
four years.
The fiscal 2009 performance-based restricted stock awards for
the CEO and other NEOs were subject to increase or decrease by
up to 50% at fiscal year end, based upon the financial
performance of the Company during fiscal 2009. The measure of
the Companys performance for this purpose for fiscal 2009
was PBT. We use PBT because this measure is simple and
objective, emphasizes controlling costs and increasing profits
and
23
is a key driver for total shareholder return. The threshold,
target and maximum PBT levels for purposes of increasing or
decreasing the number of shares of performance-based restricted
stock, as well as the Incentive PBT (as defined below), for
fiscal 2009 are set forth in the following table:
2009 PBT
PERFORMANCE LEVELS ($ in millions)
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Fiscal 2009 Threshold
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Fiscal 2009 Target
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Fiscal 2009 Maximum
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Performance Level
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Performance Level
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Performance Level
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Fiscal 2009 Incentive PBT
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|
287
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337
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372
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301
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For fiscal 2009, our actual PBT amount, as adjusted as set forth
below (Incentive PBT), fell between the threshold
and target performance levels. In calculating Incentive PBT, the
Compensation Committee used adjusted PBT for fiscal 2009,
adjusted this amount to bring actual results back to the
forecasted currency exchange rates, and then made the same
adjustments used in calculating fiscal 2009 Incentive EBITDA for
purposes of the RSIP. Adjusted PBT excludes the same charges
used in calculating reported adjusted EBITDA for fiscal 2009.
Based on Company performance, there was a 36% downward
adjustment in the fiscal 2009 performance-based restricted stock
awards granted to the NEOs. Consequently, the number of shares
of performance-based restricted stock actually awarded for
fiscal 2009, after adjustment for Company performance and the
resulting reduction in the number of shares, was as follows:
Mr. Chidsey, 49,542; Mr. Wells, 8,813; Mr. Klein,
12,233; Mr. Fallon, 8,578; and Mr. Robinson, 8,257.
The Compensation Committee decided to retain the same equity mix
and vesting schedule for the Companys fiscal 2010
long-term equity incentive program to maintain our desired
equity mix. In accordance with the approval by the Compensation
Committee and, in the case of the CEO, by our Board, on
August 26, 2009, the Company granted the NEOs a combination
of equity grants, with 50% of the value earned paid in the form
of stock options and 50% of the value earned paid in the form of
performance-based restricted stock awards. The option awards
will vest ratably over four years and the performance-based
restricted stock awards will have a one year performance period
ending June 30, 2010, and will vest 100% on the third
anniversary of the grant date. For the reasons discussed above
regarding why we use PBT, the Compensation Committee determined
that PBT will continue to be used as the measure of the
Companys performance for the fiscal 2010 long-term equity
incentive awards. For fiscal 2010, the target equity awards for
the NEOs, after application of the Individual Performance
Multiplier and as a percentage of their base salary are as
follows: Mr. Chidsey, 400%; Mr. Klein, 200%; and
Messrs. Wells and Fallon, 150%. Due to the change in his
position, Mr. Robinson will receive an equity grant as
described below under the Employment
Agreements Employment Agreements with Other
NEOs section of this CD&A.
Executive
Benefits & Perquisites
In addition to base salary, annual cash bonuses and long-term
equity incentives, we provide the following executive benefit
programs:
Executive
Retirement Program
The Executive Retirement Program (ERP) is a
non-qualified excess benefits program available to senior-level
U.S. employees. This program permits voluntary deferrals of
up to 50% of base salary and 100% of cash bonus until retirement
or termination of employment. Deferrals become effective once an
executive has reached his or her applicable 401(k) contribution
limit. Amounts deferred, up to a maximum of 6% of base salary,
are matched by us on a
dollar-for-dollar
basis. Depending on the level at which we achieve specified
financial performance goals, accounts under the plan also may be
credited by us with up to an additional 4% of base salary at the
target performance level and 6% of base salary at the maximum
performance level. The financial performance goals for fiscal
2009 were based on the EBITDA levels described in the
Annual Cash Incentive Program section of this
CD&A. The financial performance goals for fiscal 2010 will
be based on PBT to reflect the change made in the measure of
worldwide Company financial performance under the RSIP for
fiscal 2010. Prior to fiscal 2008, all accounts earned interest
at the same fixed interest rate. Beginning in fiscal 2008, all
amounts earned interest at a rate that reflects the performance
of
24
investment funds that the employee selects from a pool of funds.
All of our contributions vest ratably over the three-year period
beginning on the date the employee commences employment. After
three years of employment, all future Company contributions for
the benefit of that employee are fully vested. Our
performance-based contribution for fiscal 2009 was 3.1% of base
salary for all participating employees. On July 1, 2007, we
established a rabbi trust to invest compensation deferred under
the ERP and fund future deferred compensation obligations. We
closed the rabbi trust for any new contributions effective
September 1, 2009, and all future contributions will be
made on an unfunded basis. Further details are provided in the
2009 All Other Compensation Table and the 2009 Nonqualified
Deferred Compensation Table.
Executive
Life Insurance Program
The Executive Life Insurance Program provides life insurance
coverage which is paid by us and allows our U.S. executives
to purchase additional life insurance coverage at their own
expense. Coverage for our NEOs, which is paid by us, is limited
to the lesser of $1.3 million or 2.75 times base salary.
Further details are provided in the 2009 All Other Compensation
Table.
Executive
Health Plan
The Executive Health Plan is offered to all of our NEOs except
Mr. Robinson while he was on temporary assignment outside
the U.S. and serves as a fully insured supplement to the
medical plan provided to all BKC employees.
Out-of-pocket
costs and expenses for deductibles, coinsurance, dental care,
orthodontia, vision care, prescription drugs, and preventative
care for an NEO and his eligible dependents are reimbursed up to
an annual maximum of $100,000. While Mr. Robinson was on
temporary assignment outside of the U.S., he received medical
and dental coverage through Cigna International. The Company
paid the premiums for this insurance coverage, which paid 100%
of most of Mr. Robinsons medical and dental expenses
and those of his eligible dependents. Further details are
provided in the 2009 All Other Compensation Table.
Perquisites
Each NEO is provided with an annual perquisite allowance to be
used at his discretion. Currently, the annual allowance is
$50,000 for Mr. Chidsey and $35,000 for Messrs. Wells,
Klein, Robinson and Fallon. While on assignment,
Mr. Robinson received expatriate benefits set forth in the
2009 All Other Compensation Table and an annual perquisite
allowance of $29,272. In addition to Mr. Chidseys
annual perquisite allowance, he is entitled to personal use of
private charter jet and private car service, which are not
subject to tax
gross-up.
Additional information regarding perquisites provided to the
NEOs is set forth in the 2009 Perquisites Table.
Certain
Other Benefits
BKC also maintains a comprehensive benefits program consisting
of retirement income and health and welfare plans. The objective
of the program is to provide full time employees with reasonable
and competitive levels of financial support in the event of
retirement, death, disability or illness, which may interrupt
the eligible employees employment or income received as an
active employee. BKCs health and welfare plans consist of
life, disability and health insurance benefit plans that are
available to all eligible full-time employees. BKC also provides
a 401(k) plan that is available to all eligible full-time
employees. The 401(k) plan includes a matching feature of up to
6% of the employees base salary.
Other
Compensation Committee Actions
From time to time, our Compensation Committee awards special
cash or equity grants for retention purposes or to recognize
extraordinary performance or disparities in pay. On
August 20, 2009, the Compensation Committee approved a
one-time cash bonus of $50,000 for Mr. Wells, our Chief
Financial Officer, to recognize extraordinary performance. This
special bonus was paid in September 2009 in addition to the cash
bonus he earned under the RSIP.
25
On August 20, 2009, the Compensation Committee approved a
special equity grant with a grant date of August 26, 2009
and an aggregate value of $2.25 million for Mr. Klein,
our President, Global Marketing, Strategy and Innovation, as a
retention tool. The special equity grant, which consisted of a
combination of 114,678 stock options and 81,922 shares of
restricted stock, vests over five years, with one-third vesting
on the third anniversary of the grant date, one-third vesting on
the fourth anniversary of the grant date and the balance vesting
on the fifth anniversary. The Board of Directors ratified the
special equity grant on August 20, 2009.
The Compensation Committee reviewed and approved the employment
agreement, including the material compensation terms, for Kevin
Higgins, our new President, EMEA.
Employment
Agreements
We currently have employment agreements with our CEO and each of
our officers. We believe that employment agreements provide us
protection in an extremely competitive environment by imposing
restrictions on an employees ability to engage in
competitive activities and solicit employees and franchisees.
Pursuant to his or her respective employment agreement, the CEO
and each of our CEO Direct Reports has agreed (i) not to
compete with us during the term of his or her employment and for
one year after termination of employment; (ii) not to
solicit our employees or franchisees during the term of his or
her employment and for one year after termination; and
(iii) to maintain the confidentiality of our information.
If an executive breaches any of these covenants, we will cease
providing any severance and other benefits to the executive and
we have the right to require the executive to repay any
severance amounts already paid to him or her. See the
Clawback Policy section of this CD&A for
information about our right to recoup economic gains from equity
grants if an employee violates any restrictive covenants
contained in his or her employment or separation agreement.
During fiscal 2009, we amended the employment agreements of
Messrs. Chidsey, Wells, Klein and Fallon to bring them into
compliance with the requirements of Section 409A of the
IRC, and the related regulations and other guidance promulgated
thereunder.
Employment
Agreement with Mr. Chidsey
We initially entered into an employment agreement with
Mr. Chidsey to serve as our Chief Executive Officer on
April 6, 2006, which was amended on December 16, 2008.
The initial term of the agreement ended on April 6, 2009.
At the end of the term, the agreement automatically extends for
additional three-year periods, unless either party provides
notice of non-renewal to the other at least six months prior to
the expiration of the relevant period. Prior to the notice date,
the Compensation Committee evaluated the terms of
Mr. Chidseys employment agreement and decided that
the agreement should be renewed. Consequently, on April 7,
2009, the agreement automatically extended for a period of three
years. The current term of the agreement ends on April 6,
2012. Pursuant to his employment agreement, Mr. Chidsey is
eligible to receive an annual base salary of $1,042,875, subject
to increase by the Compensation Committee, in its sole
discretion. The employment agreement provides that
Mr. Chidseys target annual cash bonus opportunity is
100% of his base salary; however, Mr. Chidsey has the
opportunity to earn up to 250% of his base salary if we achieve
our financial objectives at the maximum performance level and
Mr. Chidsey receives the maximum individual performance
rating pursuant to the RSIP. Mr. Chidsey may elect to
receive up to 50% of his annual cash bonus in such non-cash form
as the Compensation Committee makes available to members of our
senior management team. On an annual basis, Mr. Chidsey
also is entitled to receive a target annual performance-based
equity grant (consisting of restricted stock, stock options or
any combination thereof as determined by the Compensation
Committee) with a grant date value equal to 400% of his base
salary as described in the Elements of Compensation and
Benefit Programs section of this CD&A.
Mr. Chidsey also is entitled to receive an annual
perquisite allowance of $50,000 and private charter jet usage
for business travel (and up to $100,000 per year for personal
use). Additional information regarding Mr. Chidseys
private charter jet usage is set forth in the 2009 Perquisites
Table.
26
If Mr. Chidseys employment is terminated without
cause or he terminates his employment with good reason or due to
his death or disability (as such terms are defined in the
employment agreement), he will be entitled to receive an amount
equal to two times his annual base salary, annual perquisite
allowance and target annual cash bonus (or three times, if his
termination occurs after a change in control). This severance
amount will be payable over a period of six months on our
regular payroll dates, commencing on the first business day
immediately following the six month anniversary of the
termination date and ending on the one year anniversary of the
termination date. Mr. Chidsey also will be entitled to
continued coverage under BKCs medical, dental and life
insurance plans for him and his eligible dependents during the
two-year period following termination (or three-year period, if
his termination occurs after a change in control). If
Mr. Chidseys employment is terminated due to his
death or disability or during the
24-month
period after a change in control of the Company either without
cause or for good reason, all options and other equity awards
held by Mr. Chidsey will vest in full. Upon termination of
his employment for any reason other than for cause,
Mr. Chidsey will have one year to exercise all vested
awards. Among other events, a resignation for any reason within
the 30-day
period immediately following the one-year anniversary of a
change in control involving a strategic buyer (as determined by
the Board) constitutes a termination by BKC without cause under
the employment agreement. If any payments due to
Mr. Chidsey in connection with a change in control would be
subject to an excise tax, we will provide Mr. Chidsey with
a related tax
gross-up
payment, unless a reduction in Mr. Chidseys payments
by up to 10% would avoid the excise tax.
Employment
Agreements with Other NEOs
We have entered into one-year employment agreements with each of
Messrs. Wells, Klein, Fallon and Robinson. At the end of
the term, each executives employment agreement
automatically extends for an additional one-year period and will
continue to be so extended unless BKC provides notice of
non-renewal at least 90 days prior to the expiration of the
relevant period. The employment agreements of each of
Messrs. Wells, Klein and Fallon expired on June 30,
2009 and, on July 1, 2009, these agreements automatically
extended for a period of one year each. Mr. Robinsons
employment agreement expired on September 30, 2009 and, on
October 1, 2009, this agreement, as amended, automatically
extended for a one-year period.
Pursuant to their respective employment agreements, these NEOs
are eligible to receive annual base salaries of $494,709 for
Mr. Wells, $515,000 for Mr. Klein, $437,750 for
Mr. Fallon, and $463,500 for Mr. Robinson, subject to
increase by the Compensation Committee, in its sole discretion.
During fiscal 2009, each of Messrs. Wells, Fallon and
Robinson was eligible to receive a performance-based annual cash
bonus with a target payment equal to 70% of his annual base
salary if we achieve the target financial objectives set by the
Compensation Committee for a particular fiscal year; however, he
is eligible to receive a performance-based annual cash bonus of
up to 175% of his base salary if we achieve our financial
objectives at the maximum level and he receives the maximum
individual performance rating pursuant to the RSIP.
Mr. Klein is eligible to receive a performance-based annual
cash bonus with a target payment equal to 80% of his annual base
salary if we achieve the target financial objectives set by the
Compensation Committee for a particular fiscal year; however, he
is eligible to receive a performance-based annual cash bonus of
up to 200% of his base salary if we achieve our financial
objectives at the maximum level and he receives the maximum
individual performance rating pursuant to the RSIP. Each
executive may elect to receive up to 50% of his annual cash
bonus in the form of restricted stock units or in any other
non-cash form that the Compensation Committee makes available to
members of BKCs senior management team. Each executive
also is entitled to receive an annual perquisite allowance of
$35,000 and is eligible to participate in our long-term equity
programs. However, Mr. Robinsons fiscal 2009
perquisite allowance was $29,272 plus the use of a Company car.
Each executive is entitled to receive outplacement services upon
termination of employment.
With respect to Messrs. Wells, Klein and Fallon only, if
BKC terminates the executives employment without cause or
if the executive terminates his employment with good reason (as
defined in the relevant agreement), he will be entitled to
receive his then current base salary and perquisite allowance
for one year, payable in equal installments over a six-month
period beginning on the first business day following the six
month anniversary of the termination date and ending on the one
year anniversary of the termination date and
27
continued coverage for one year under BKCs medical, dental
and life insurance plans for the executive and his eligible
dependents. Additionally, if the executives employment is
terminated at any time within 24 months after a change in
control of the Company either without cause or by the executive
for good reason, all options held by the executive will become
fully vested upon termination and he will have 90 days to
exercise such options. See the 2009 Potential Payments Upon
Termination or Change in Control Table for a description of
accelerated vesting of other types of equity upon termination of
employment without cause or for good reason following a change
in control.
In addition to his employment agreement, we entered into an
assignment letter with Mr. Robinson, effective
October 1, 2006, which set forth the terms of his
assignment as Executive Vice President and President, EMEA,
designated Burger King Europe GmbH as the host entity and set
forth the expatriate benefits that he would be entitled to
during the overseas assignment. In addition, the assignment
letter set forth the terms under which BKC would be responsible
for the relocation of Mr. Robinson and his family back to
the U.S., including (i) if we terminated his employment
other than for cause, (ii) if the assignment terminates in
accordance with its terms (other than as a result of termination
of Mr. Robinsons employment with the Company),
(iii) if the assignment was terminated due to his death or
disability or the extended illness of a family member, or
(iv) if Mr. Robinson resigned following three years of
continuous employment with the Company and has not accepted
employment with another organization. Based on the terms of the
assignment letter, we will pay the expenses associated with
Mr. Robinsons relocation back to the U.S. as a
result of the completion of his assignment as President, EMEA.
Mr. Robinsons assignment as President, EMEA ended on
September 30, 2009. Commencing on October 1, 2009, we
appointed Mr. Robinson to the office of Executive Vice
President and entered into an amendment to his employment
agreement. Pursuant to the amendment, (i) we agreed to
provide Mr. Robinson with temporary housing, grossed up for
taxes, (ii) we agreed to pay Mr. Robinson a one-time
signing bonus of $35,000, payable on our first regular payroll
date after November 1, 2009, (iii) Mr. Robinson
will receive a cash retention bonus in the annualized amount of
$150,000, payable in equal installments on our regular payroll
dates provided that he remains employed by us on the applicable
payment date; (iv) if we terminate Mr. Robinsons
employment without cause or if Mr. Robinson terminates his
employment for any reason during our 2010 fiscal year, he will
receive a prorated cash bonus based on 70% of his base salary
whether or not we achieve our specific financial goals for the
2010 fiscal year, (v) if we terminate
Mr. Robinsons employment without cause or if
Mr. Robinson terminates his employment with good reason
during any year following the 2010 fiscal year, he will receive
a prorated cash bonus calculated in accordance with the cash
incentive plan then in effect (and determined based on the
extent to which we actually achieve the performance goals for
such year), payable within five business days following the date
annual bonuses are paid for such fiscal year, and
(vi) Mr. Robinson will not be entitled to any other
severance benefits under his employment agreement. In addition,
on November 1, 2009, Mr. Robinson will receive an
equity grant consisting of 13,088 stock options which will fully
vest on August 26, 2010, subject to his award agreement.
The option exercise price will be determined on November 1,
2009 in accordance with our equity grant policy described below
under the Additional Features of our Executive
Compensation Programs section of this CD&A.
The potential payments and benefits to the NEOs in the event of
a termination of employment or change in control are described
below in the 2009 Potential Payments Upon Termination or Change
in Control Table.
Additional
Features of our Executive Compensation Programs
Deductibility
of Compensation
Section 162(m) of the IRC and the related regulations and
other guidance promulgated thereunder, generally limit the tax
deductibility of non-performance based annual compensation paid
by a publicly-held company to $1,000,000 for the CEO, CFO and
the next three highest compensated officers of the Company.
Since we became a public company in May 2006, our existing
compensation programs have been eligible for special relief from
this tax rule. Once this relief expires in November 2010, the
Compensation Committee intends to utilize performance-based
compensation programs that meet the deductibility requirements
under
28
Section 162(m). However, the Compensation Committee also
realizes that in order to attract and retain individuals with
superior talent, the possibility exists that individual
exceptions may occur.
Equity
Grant Policy
On February 28, 2007, the Compensation Committee adopted an
Equity Grant Policy governing the issuance of equity awards.
Under the Equity Grant Policy, the Compensation Committee may
delegate to one of our officers the authority to make grants to
any person other than the CEO, the CEO Direct Reports or our
executive officers.
Under the Equity Grant Policy, our annual employee grants are
made on August 21st of each year and our mid-year
grants are made on March 21st of each year. The
Company, with the approval of the Compensation Committee or
pursuant to the delegation of authority described above, also
may make additional grants at its discretion. These additional
grants are generally made for purposes of recognition and
retention, and to newly hired executives, and are to be awarded
on the first day of the month following the date of approval of
the equity award, or at a later date designated by the approving
authority. No grants may be made on any of these predetermined
dates if the grant date would fall on or within five days
preceding our release of material non-public information. In
such event, the grant date must be postponed until the first
business day following the release.
Under the Equity Grant Policy, we set the exercise price of
options and the fair market value of other equity awards at the
closing price of our common stock on the NYSE on the date of the
grant, or, if there is no reported sale on the grant date, then
on the last preceding date on which any reported sale occurred.
Executive
Stock Ownership Guidelines
On September 13, 2007, the Board adopted Executive Stock
Ownership Guidelines (the Guidelines) establishing
minimum equity ownership requirements for our CEO, executive
vice presidents and senior vice presidents. The purposes of the
Guidelines are to align the interests of those executives with
the interests of shareholders and further promote our commitment
to sound corporate governance. The minimum required ownership is
determined as a multiple of the executives annual base
salary, based upon the executives level, as follows: 4
times base salary for our CEO, 2.5 times base salary for
Mr. Klein, 2 times base salary for all other executive vice
presidents, 1.75 times base salary for all regional presidents
and one times base salary for all other senior vice presidents.
The Guidelines identify the types of equity that may be
considered in determining whether an executive has met the
minimum ownership requirement. Executives will have between
three and five years to reach the minimum requirement, depending
upon the date they commenced employment with us. If an executive
does not meet his or her minimum required ownership within the
proscribed time period, then until he or she meets the
requirement, he or she must retain 100% of all net shares
received from the exercise or settlement of equity awards
granted under our incentive plans. Once an executive achieves
his or her minimum required ownership on or after the applicable
deadline, he or she must maintain the minimum required ownership
for as long as he or she is an employee.
Clawback
Policy
As described in our standard equity award agreements issued
after April 2006, the Compensation Committee has the right to
seek to recoup economic gains realized during the preceding year
from the vesting, exercise or settlement of equity grants from
an employee who violates any post-employment restrictive
covenants contained in his or her employment or separation
agreement, including non-compete and confidentiality obligations.
29
COMPENSATION
COMMITTEE REPORT
We have reviewed and discussed the foregoing Compensation
Discussion and Analysis with management. Based on our review and
discussions with management, we have approved the inclusion of
the Compensation Discussion & Analysis in this proxy
statement.
COMPENSATION
COMMITTEE
Stephen G. Pagliuca, Chairman
Peter R. Formanek
Sanjeev K. Mehra
September 17, 2009
30
EXECUTIVE
COMPENSATION
2009
SUMMARY COMPENSATION TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonqualified
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Equity
|
|
|
Deferred
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
|
|
|
Option
|
|
|
Incentive Plan
|
|
|
Compensation
|
|
|
All Other
|
|
|
|
|
Name and
|
|
Year
|
|
|
Salary
|
|
|
Bonus
|
|
|
Awards
|
|
|
Awards
|
|
|
Compensation
|
|
|
Earnings
|
|
|
Compensation
|
|
|
Total
|
|
Principal Position
|
|
(1)
|
|
|
($)
|
|
|
($)
|
|
|
(2)($)
|
|
|
(3)($)
|
|
|
(4)($)
|
|
|
(5)($)
|
|
|
(6)($)
|
|
|
($)
|
|
|
John W. Chidsey
|
|
|
2009
|
|
|
|
1,034,697
|
|
|
|
0
|
|
|
|
2,438,064
|
|
|
|
865,055
|
|
|
|
803,014
|
|
|
|
0
|
|
|
|
316,943
|
|
|
|
5,457,773
|
|
Chief Executive Officer
|
|
|
2008
|
|
|
|
1,012,500
|
|
|
|
0
|
|
|
|
1,923,623
|
|
|
|
694,343
|
|
|
|
1,306,125
|
|
|
|
0
|
|
|
|
434,190
|
|
|
|
5,370,781
|
|
|
|
|
2007
|
|
|
|
1,009,135
|
|
|
|
0
|
|
|
|
1,140,693
|
|
|
|
338,589
|
|
|
|
1,336,500
|
|
|
|
8,741
|
|
|
|
333,018
|
|
|
|
4,166,676
|
|
Ben K. Wells
|
|
|
2009
|
|
|
|
490,830
|
|
|
|
50,000
|
|
|
|
332,537
|
|
|
|
277,344
|
|
|
|
266,648
|
|
|
|
0
|
|
|
|
115,336
|
|
|
|
1,532,695
|
|
Chief Financial Officer
|
|
|
2008
|
|
|
|
479,147
|
|
|
|
0
|
|
|
|
241,280
|
|
|
|
439,933
|
|
|
|
433,711
|
|
|
|
0
|
|
|
|
126,109
|
|
|
|
1,720,180
|
|
|
|
|
2007
|
|
|
|
428,883
|
|
|
|
0
|
|
|
|
96,886
|
|
|
|
373,184
|
|
|
|
398,698
|
|
|
|
589
|
|
|
|
95,237
|
|
|
|
1,393,477
|
|
Russell B. Klein
|
|
|
2009
|
|
|
|
510,962
|
|
|
|
0
|
|
|
|
484,111
|
|
|
|
419,348
|
|
|
|
317,240
|
|
|
|
0
|
|
|
|
121,650
|
|
|
|
1,853,311
|
|
President, Global
|
|
|
2008
|
|
|
|
500,000
|
|
|
|
0
|
|
|
|
359,679
|
|
|
|
414,721
|
|
|
|
516,000
|
|
|
|
0
|
|
|
|
146,610
|
|
|
|
1,937,010
|
|
Marketing, Strategy &
|
|
|
2007
|
|
|
|
500,000
|
|
|
|
300,000
|
|
|
|
151,978
|
|
|
|
321,118
|
|
|
|
529,447
|
|
|
|
4,773
|
|
|
|
110,845
|
|
|
|
1,918,161
|
|
Innovation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charles M. Fallon, Jr.
|
|
|
2009
|
|
|
|
434,317
|
|
|
|
0
|
|
|
|
304,745
|
|
|
|
518,924
|
|
|
|
222,158
|
|
|
|
0
|
|
|
|
96,527
|
|
|
|
1,576,671
|
|
President, North
|
|
|
2008
|
|
|
|
425,000
|
|
|
|
0
|
|
|
|
281,109
|
|
|
|
489,515
|
|
|
|
391,162
|
|
|
|
0
|
|
|
|
128,575
|
|
|
|
1,715,361
|
|
America
|
|
|
2007
|
|
|
|
425,000
|
|
|
|
0
|
|
|
|
300,840
|
|
|
|
331,582
|
|
|
|
451,094
|
|
|
|
511
|
|
|
|
314,592
|
|
|
|
1,823,619
|
|
Peter B. Robinson
|
|
|
2009
|
|
|
|
459,866
|
|
|
|
0
|
|
|
|
194,605
|
|
|
|
398,419
|
|
|
|
449,363
|
|
|
|
0
|
|
|
|
783,835
|
(8)
|
|
|
2,286,088
|
|
President, EMEA(7)
|
|
|
2008
|
|
|
|
450,000
|
|
|
|
0
|
|
|
|
97,498
|
|
|
|
327,188
|
|
|
|
373,968
|
|
|
|
0
|
|
|
|
693,713
|
(8)(9)
|
|
|
1,942,367
|
|
|
|
(1)
|
Please refer to our fiscal 2007 and 2008 proxy statements and
accompanying footnotes for additional information relating to
fiscal 2007 and 2008 compensation.
|
(2)
|
Amounts shown in this column include the accounting expense
recognized by us in fiscal 2007, fiscal 2008 and fiscal 2009
related to the performance-based restricted stock awards.
|
(3)
|
Amounts shown in this column include (i) the accounting
expense recognized by us in fiscal 2007, fiscal 2008 and fiscal
2009 related to the unvested portion of stock option awards made
on or after February 16, 2006 (the Post-IPO
Options) and (ii) the accounting expense that would
have been recognized by us in fiscal 2007, fiscal 2008 and
fiscal 2009 relating to the unvested portion of stock option
awards made prior to February 16, 2006 (the Pre-IPO
Options) if these options had been subject to the
modified prospective transition method for public
companies. Since we applied the minimum value method to options
granted prior to our becoming a public company, as permitted
under SFAS No. 123, we did not recognize any expense
associated with Pre-IPO Options in our financial statements for
fiscal 2007, fiscal 2008 or fiscal 2009 and will not in any
future periods.
|
The assumptions and methodology used to calculate the accounting
expense for the Post-IPO options recognized in fiscal 2007 are
set forth in Note 3 to our Consolidated Financial
Statements included in our
Form 10-K
for fiscal 2007, for the Post-IPO Options recognized in fiscal
2008, are set forth in Note 3 to our Consolidated Financial
Statements included in our
Form 10-K
for fiscal 2008, and for the Post-IPO Options recognized in
fiscal 2009, are set forth in Note 3 to our Consolidated
Financial Statements included in our
Form 10-K
for fiscal 2009. The assumptions and methodology used to
calculate the expense associated with the Pre-IPO Options for
purposes of this 2009 Summary Compensation Table are set forth
below:
Valuation and amortization method We
determined the fair value of the Pre-IPO Options using the
Black-Scholes option-pricing formula. This fair value was then
amortized on a straight-line basis over the requisite service
periods of the awards, which is generally the vesting period.
The Pre-IPO Options expire 10 years from the grant date and
generally vest ratably over a five-year service period
commencing on the grant date.
Expected Term The expected term represents
the period that our stock-based awards are expected to be
outstanding and was determined based on historical experience of
similar awards, giving consideration to contractual terms of the
awards, vesting schedules and expectations of future employee
behavior.
Expected Volatility As we were not a
publicly-traded company on the date that any of the Pre-IPO
Options were granted, we have elected to base our estimate of
the expected volatility of our common stock on the historical
volatility of a group of our peers whose historical share prices
for the relevant time frame are publicly available. The time
frame used was five years prior to grant date.
Expected Dividend Yield We used historical
dividend yield trends as an estimate for future yields for all
Pre-IPO Options. As we did not declare dividends prior to
February 16, 2006, the dividend yield used for all Pre-IPO
Options was 0.00%.
Risk-Free Interest Rate We based the
risk-free interest rate used in the Black-Scholes valuation
method at the time of the stock option grant on the yield to
maturity on zero-coupon U.S. government bonds having a
remaining life equal to the options expected term.
31
The following assumptions were used to estimate the fair value
of the Pre-IPO Options granted in each of the calendar years set
forth below:
|
|
|
|
|
|
|
|
|
|
|
Pre-IPO Option Grant Date
|
|
|
1/1/06 2/15/06
|
|
7/1/05 12/31/05
|
|
2005
|
|
2004
|
|
Average expected term
|
|
5 yrs.
|
|
5 yrs.
|
|
5 yrs.
|
|
5 yrs.
|
Expected volatility
|
|
31.84%
|
|
32.97% 33.61%
|
|
36.62% 40.54%
|
|
41.79% 45.15%
|
Weighted-average volatility
|
|
31.84%
|
|
33.28%
|
|
39.94%
|
|
42.99%
|
Risk-free interest rate
|
|
4.78%
|
|
4.78%
|
|
3.88% 4.78%
|
|
3.48% 3.98%
|
Expected dividend yield
|
|
0.0%
|
|
0.0%
|
|
0.0%
|
|
0.0%
|
Weighted-average fair value
|
|
$7.94
|
|
$3.87
|
|
$3.87
|
|
$1.54
|
|
|
(4)
|
The amounts reported in this column reflect compensation earned
for fiscal 2009, fiscal 2008 and fiscal 2007 performance under
the RSIP. We pay cash incentives under the RSIP in the fiscal
year following the fiscal year in which they were earned. For
fiscal 2009, the Compensation Committee determined that
worldwide and North America Incentive EBITDA was between the
threshold and target performance levels and Incentive EBITDA for
the EMEA region exceeded the maximum performance level. Based on
these results, the Compensation Committee approved each
NEOs individual performance measures and cash incentive
payment, and submitted the CEOs individual performance
measures and cash incentive payment for approval to the Board of
Directors. In August 2009, the Board approved the Compensation
Committees recommendations. Fiscal 2009 cash incentive
payments were made in September 2009.
|
(5)
|
There were no above market earnings for fiscal 2009.
The amounts reported reflect the above market
earnings for fiscal 2007 on income previously earned and
deferred by each NEO under the ERP. The ERP is described in the
Executive Benefits & Perquisites section
of the CD&A.
|
(6)
|
This column includes the fiscal 2009 perquisites described below
in the 2009 Perquisites Table. This column also includes
expatriate benefits for Mr. Robinson, executive medical
expenses for all NEOs, life insurance premiums, dividend
payments and dividend equivalents as described in Footnote 3 to
the 2009 All Other Compensation Table, and the Companys
matching and performance-based contributions to the
Companys 401(k) plan and ERP, as described below in the
2009 All Other Compensation Table.
|
(7)
|
Mr. Robinson became an Executive Officer in fiscal 2008.
|
(8)
|
The exchange rates used for Mr. Robinsons expatriate
benefits for fiscal 2009 which were paid in Swiss Francs are
based on the one day average historical rate as found on
OANDA.com on June 30, 2009, as follows: 1 CHF = 0.92134 USD.
|
(9)
|
Corrected from amount previously reported to reflect All Other
Compensation for fiscal 2008 of $693,713, an increase of
$126,791, including expatriate benefits of $557,091. Total
expatriate benefits for fiscal 2008 included (i) $85,817 in
housing assistance, plus tax
gross-up of
$1,263; (ii) $387,156 in Swiss individual income taxes,
plus tax
gross-up of
$5,238, (iii) $62,517 cost of living allowance, plus tax
gross-up of
$1,378; and (iv) the U.S. dollar value of tax preparation
services, U.S. Tax Equalization Payment and home leave, plus
applicable tax
gross-ups.
The purpose of the tax equalization and tax gross-ups is to
ensure that the expatriate employee is in the same financial
position that he would have been had he remained employed in the
United States.
|
2009
PERQUISITES TABLE
Our NEOs received the following perquisites during fiscal 2009:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Auto
|
|
|
|
|
|
|
|
|
Perquisite
|
|
|
|
Expenses /
|
|
|
|
Total
|
|
|
|
|
Allowance
|
|
Personal
|
|
Car Service
|
|
Miscellaneous(4)
|
|
Perquisites
|
Name
|
|
Year
|
|
(1)($)
|
|
Travel($)
|
|
($)
|
|
($)
|
|
($)
|
|
John W. Chidsey
|
|
|
2009
|
|
|
|
50,000
|
|
|
|
62,327
|
(2)
|
|
|
6,690
|
(3)
|
|
|
0
|
|
|
|
119,017
|
|
Ben K. Wells
|
|
|
2009
|
|
|
|
35,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
212
|
|
|
|
35,212
|
|
Russell B. Klein
|
|
|
2009
|
|
|
|
35,000
|
|
|
|
1,380
|
|
|
|
0
|
|
|
|
0
|
|
|
|
36,380
|
|
Charles M. Fallon, Jr.
|
|
|
2009
|
|
|
|
35,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
35,000
|
|
Peter B. Robinson
|
|
|
2009
|
|
|
|
29,272
|
|
|
|
0
|
|
|
|
0
|
(5)
|
|
|
0
|
|
|
|
29,272
|
|
|
|
(1)
|
These perquisite allowances were paid to the NEOs in accordance
with their respective employment agreements. Each NEO uses the
perquisite allowance at his discretion.
|
(2)
|
Pursuant to his employment agreement, Mr. Chidsey is
entitled to private charter jet usage for personal use of up to
$100,000 per year. However, under his employment agreement, only
hourly charges and fuel surcharges are to be considered for
purposes of this $100,000 allowance. In accordance with SEC
guidance, the amounts included in this column have been
calculated utilizing the actual invoice amount, which we believe
more accurately reflects the incremental cost to the Company for
this perquisite. The aggregate incremental cost to the Company
for Mr. Chidseys personal usage of the Company
aircraft was $62,327 for fiscal 2009. Mr. Chidsey is fully
responsible for all taxes associated with his personal use of
the Company aircraft.
|
(3)
|
Mr. Chidsey is entitled to personal use of a car service,
and the charges for this perquisite totaled $6,690.
Mr. Chidsey is fully responsible for all taxes associated
with this perquisite.
|
(4)
|
Represents event tickets paid or provided by the Company.
|
32
|
|
(5) |
The cost to the Company of Mr. Robinsons car in
Switzerland is reported in the 2009 All Other Compensation Table
under Expatriate Benefits.
|
2009 ALL
OTHER COMPENSATION TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contributions
|
|
Dividend
|
|
|
|
|
|
|
|
|
|
|
Welfare
|
|
to Retirement and
|
|
Equivalents
|
|
Expatriate
|
|
|
|
|
|
|
Perquisites
|
|
Plans
|
|
401(k) Plans
|
|
Earned
|
|
Benefits
|
|
Total
|
Name
|
|
Year
|
|
($)
|
|
(1)($)
|
|
(2)($)
|
|
(3)($)
|
|
($)
|
|
($)
|
|
John W. Chidsey
|
|
|
2009
|
|
|
|
119,017
|
|
|
|
19,290
|
|
|
|
96,747
|
|
|
|
81,889
|
|
|
|
0
|
|
|
|
316,943
|
|
Ben K. Wells
|
|
|
2009
|
|
|
|
35,212
|
|
|
|
21,833
|
|
|
|
44,753
|
|
|
|
13,538
|
|
|
|
0
|
|
|
|
115,336
|
|
Russell B. Klein
|
|
|
2009
|
|
|
|
36,380
|
|
|
|
18,302
|
|
|
|
47,050
|
|
|
|
19,918
|
|
|
|
0
|
|
|
|
121,650
|
|
Charles M. Fallon, Jr.
|
|
|
2009
|
|
|
|
35,000
|
|
|
|
9,492
|
|
|
|
39,600
|
|
|
|
12,435
|
|
|
|
0
|
|
|
|
96,527
|
|
Peter B. Robinson
|
|
|
2009
|
|
|
|
29,272
|
|
|
|
35,982
|
|
|
|
41,930
|
|
|
|
6,838
|
|
|
|
669,813
|
(4)
|
|
|
783,835
|
|
|
|
(1)
|
Amounts in this column reflect life insurance premiums paid by
us and payments made by us under the Executive Health Plan and
the health plan applicable to Mr. Robinson. The amounts for
each NEO for fiscal 2009 life insurance premiums and executive
health plan are as follows: Mr. Chidsey, $2,056 and
$17,234, respectively; Mr. Wells, $5,250 and $16,583,
respectively; Mr. Klein, $3,432 and $14,870, respectively;
Mr. Fallon, $1,880 and $7,612, respectively; and
Mr. Robinson, $8,295 and $27,687, respectively.
|
(2)
|
The amounts in this column represent Company matching
contributions to the 401(k) plan and the ERP and the
Companys profit sharing contribution to the ERP for fiscal
2009, as follows:
|
Company
Matching Contributions to 401(k) and ERP and Company Profit
Sharing Contribution to ERP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal 2009 Company
|
|
Fiscal 2009 Company
|
|
Fiscal 2009 Profit Sharing
|
|
|
Matching Contributions
|
|
Matching Contributions
|
|
Contribution
|
NEO
|
|
401(k)($)
|
|
ERP($)
|
|
ERP($)
|
|
John W. Chidsey
|
|
|
14,700
|
|
|
|
49,718
|
|
|
|
32,329
|
|
Ben K. Wells
|
|
|
13,700
|
|
|
|
15,717
|
|
|
|
15,336
|
|
Russell B. Klein
|
|
|
14,262
|
|
|
|
16,823
|
|
|
|
15,965
|
|
Charles M. Fallon, Jr.
|
|
|
14,153
|
|
|
|
11,877
|
|
|
|
13,570
|
|
Peter B. Robinson
|
|
|
13,797
|
|
|
|
13,764
|
|
|
|
14,369
|
|
|
|
(3)
|
Quarterly dividends and dividend equivalents in the amount of
$0.0625 per share were paid by the Company to record owners of
shares, in the case of dividends, and accrued by the Company for
the holders of vested and unvested restricted stock units,
restricted stock and performance-based restricted stock, in the
case of dividend equivalents, as of September 12, 2008,
December 10, 2008, March 16, 2009 and June 10,
2009 in fiscal 2009. The amounts in this column represent
accrued dividend equivalents earned on vested and unvested
restricted stock units, restricted stock and performance-based
restricted stock. Mr. Chidsey had restricted stock units
settle during fiscal 2009 and was paid $23,712, which represents
dividends that accrued on these restricted stock units during
fiscal 2007, fiscal 2008 and fiscal 2009.
|
(4)
|
This column represents expatriate benefits received by
Mr. Robinson during fiscal 2009 in connection with his
temporary assignment from the U.S. to Switzerland. Included in
the total number is (i) $81,574 housing assistance, plus
tax gross-up
of $1,200; (ii) $472,854 estimated Swiss individual income
taxes, plus tax
gross-up of
$6,530; (iii) $59,341 cost of living allowance, plus tax
gross-up of
$1,300; (iv) $22,885 for the use of a company car in
Switzerland, plus tax
gross-up of
$242; and (v) the U.S. dollar value of tax preparation
services, U.S. Tax Equalization Payment and home leave for
Mr. Robinson and his family, plus applicable tax
gross-ups.
The purpose of the tax equalization and tax gross-ups is to
ensure that the expatriate employee is in the same financial
position that he would have been had he remained employed in the
United States. The amounts included in this column for housing
assistance, estimated Swiss individual income taxes, cost of
living allowance, the cost to the Company of
Mr. Robinsons car in Switzerland and home leave were
paid in Swiss Francs and converted to U.S. Dollars based upon
the exchange rate described in Footnote 8 to the 2009 Summary
Compensation Table.
|
33
2009
GRANTS OF PLAN-BASED AWARDS TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Grant
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Other
|
|
|
|
Date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option
|
|
|
|
Fair
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Awards:
|
|
Exercise
|
|
Value
|
|
|
|
|
|
|
Estimated Possible Payouts Under
|
|
Estimated Possible Payouts
|
|
Number of
|
|
or Base
|
|
of Stock
|
|
|
|
|
|
|
Non-Equity Incentive Plan
|
|
Under Equity Incentive Plan
|
|
Securities
|
|
Price of
|
|
and
|
|
|
|
|
|
|
Awards(2)
|
|
Awards(3)
|
|
Underlying
|
|
Option
|
|
Option
|
|
|
Grant
|
|
Approval
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
Options
|
|
Awards
|
|
Awards
|
Name
|
|
Date
|
|
Date(1)
|
|
($)
|
|
($)
|
|
($)
|
|
(#)
|
|
(#)
|
|
(#)
|
|
(#)(4)
|
|
($/sh)(5)
|
|
($)(6)
|
|
John W. Chidsey
|
|
|
8/22/2008
|
|
|
|
8/20/2008
|
|
|
|
521,438
|
|
|
|
1,042,875
|
|
|
|
2,607,188
|
|
|
|
38,704
|
|
|
|
77,408
|
|
|
|
116,112
|
|
|
|
230,375
|
|
|
|
26.16
|
|
|
|
5,004,893
|
|
Ben K. Wells
|
|
|
8/22/2008
|
|
|
|
8/20/2008
|
|
|
|
173,148
|
|
|
|
346,296
|
|
|
|
865,740
|
|
|
|
6,885
|
|
|
|
13,770
|
|
|
|
20,655
|
|
|
|
40,981
|
|
|
|
26.16
|
|
|
|
890,313
|
|
Russell B. Klein
|
|
|
8/22/2008
|
|
|
|
8/20/2008
|
|
|
|
206,000
|
|
|
|
412,000
|
|
|
|
1,030,000
|
|
|
|
9,557
|
|
|
|
19,113
|
|
|
|
28,670
|
|
|
|
56,882
|
|
|
|
26.16
|
|
|
|
1,235,779
|
|
Charles M. Fallon, Jr.
|
|
|
8/22/2008
|
|
|
|
8/20/2008
|
|
|
|
153,213
|
|
|
|
306,425
|
|
|
|
766,063
|
|
|
|
6,702
|
|
|
|
13,403
|
|
|
|
20,105
|
|
|
|
39,889
|
|
|
|
26.16
|
|
|
|
866,599
|
|
Peter B. Robinson
|
|
|
8/22/2008
|
|
|
|
8/20/2008
|
|
|
|
162,225
|
|
|
|
324,450
|
|
|
|
811,125
|
|
|
|
6,451
|
|
|
|
12,901
|
|
|
|
19,352
|
|
|
|
38,395
|
|
|
|
26.16
|
|
|
|
834,141
|
|
|
|
(1)
|
The Compensation Committee recommended and the Board approved
the fiscal 2009 grants at meetings held on August 19, 2008
and August 20, 2008, respectively. The approvals required
that the grants be made on August 22, 2008 in accordance
with the Companys Equity Grant Policy described in the
CD&A.
|
(2)
|
The amounts reported in this column reflect possible payments
based on fiscal 2009 performance under the RSIP. The
Maximum estimated possible payout reflects what an
NEO would earn if the Company met or exceeded its financial
performance goals at the maximum level and the NEO received the
highest individual performance rating. A description of the RSIP
and our Threshold, Target and
Maximum Payout Amounts is included in the CD&A.
Fiscal 2009 cash incentive payments were made in September 2009.
The actual amounts paid under the RSIP are the amounts reflected
in the Non-Equity Incentive Plan Compensation column of the 2009
Summary Compensation Table.
|
(3)
|
In August 2008, we made grants of option and performance-based
restricted stock awards to each NEO. The amounts reported under
the Threshold, Target and
Maximum columns above relate only to the
performance-based restricted stock awards made under our 2006
Omnibus Incentive Plan. The performance-based restricted stock
awards granted to the NEOs, other than the CEO, were calculated
as follows: the NEOs current salary, multiplied by the
target equity award as a percentage of base salary, adjusted by
the NEOs individual performance factor (which may result
in an award adjustment of up to plus or minus 20%), divided by
two, then divided by the closing stock price on the grant date.
For the CEO, the number of performance-based restricted shares
is calculated similarly; however, his percentage of base salary
is not subject to adjustment based on his individual
performance. The actual number of performance-based restricted
shares granted is reflected in the Target column
above. If the Company achieves its target PBT, this is the
number of performance-based restricted shares that will be
earned at the end of the one-year performance period. The number
of performance-based restricted shares that will be earned by
the NEO at the end of the one-year performance period is then
subject to a decrease of up to 50% for all NEOs if the Company
achieves PBT between the Threshold and
Target levels or an increase of up to 50% for all
NEOs if the Company achieves PBT between the Target
and Maximum levels. For fiscal 2009, Incentive PBT
fell between the threshold and target performance levels. As a
result, the awards for all NEOs were reduced by 36%, which was
the downward adjustment for the CEO and all executive vice
presidents. The actual number of performance-based restricted
shares granted for fiscal 2009, after taking into consideration
the downward adjustment for Company performance and the
resulting reduction in the number of shares, is set forth in
Footnote 6 below.
|
(4)
|
The options granted in August 2008 were made under our Equity
Incentive Plan. The options awarded to the NEOs, other than the
CEO, were calculated as follows: the NEOs current salary,
multiplied by the target equity award as a percentage of base
salary, adjusted by the NEOs individual performance factor
(which may result in an award adjustment of up to plus or minus
20%), divided by two, then divided by the economic value of our
stock on the grant date, which was $8.79 per share. For the CEO,
the number of options is calculated similarly; however, his
percentage of base salary is not subject to adjustment based on
his individual performance.
|
(5)
|
Reflects the closing price of our common stock on the NYSE on
August 22, 2008, the fiscal 2009 annual equity grant date.
|
(6)
|
The amounts reflect the fair market value of (1) the
maximum possible payout of performance-based restricted stock,
and (2) the options awarded (which were not subject to any
increase or decrease based on individual or Company performance)
on August 22, 2008 (the grant date). The actual amounts for
the performance-based restricted stock awards were determined in
August 2009, based upon the Companys Incentive PBT for
fiscal 2009, as discussed above in the CD&A. The actual
amounts of performance-based restricted stock earned, after
taking into account the downward adjustment for Company
performance and the corresponding fair value of such shares
using the closing price on the grant date of August 22,
2008 ($26.16 per share) and June 30, 2009 ($17.27 per
share), are as follows:
|
PBRS
Earned for Fiscal 2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value of PBRS
|
|
Fair Value of PBRS
|
|
|
Original PBRS
|
|
PBRS
|
|
on Grant
|
|
at Fiscal
|
|
|
Granted
|
|
Earned
|
|
Date
|
|
Year End
|
NEO
|
|
(#)
|
|
(#)
|
|
($)
|
|
($)
|
|
John W. Chidsey
|
|
|
77,408
|
|
|
|
49,542
|
|
|
|
2,024,993
|
|
|
|
855,590
|
|
Ben K. Wells
|
|
|
13,770
|
|
|
|
8,813
|
|
|
|
360,223
|
|
|
|
152,201
|
|
Russell B. Klein
|
|
|
19,113
|
|
|
|
12,233
|
|
|
|
499,996
|
|
|
|
211,264
|
|
Charles M. Fallon, Jr.
|
|
|
13,403
|
|
|
|
8,578
|
|
|
|
350,622
|
|
|
|
148,142
|
|
Peter B. Robinson
|
|
|
12,901
|
|
|
|
8,257
|
|
|
|
337,490
|
|
|
|
142,598
|
|
34
2009
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options Awards
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market
|
|
|
|
|
Number of
|
|
Number of
|
|
|
|
|
|
|
|
Number of
|
|
Value of
|
|
|
|
|
Securities
|
|
Securities
|
|
|
|
|
|
|
|
Shares or
|
|
Shares or
|
|
|
|
|
Underlying
|
|
Underlying
|
|
|
|
|
|
|
|
Units of
|
|
Units of
|
|
|
|
|
Unexercised
|
|
Unexercised
|
|
Option
|
|
|
|
|
|
Stock that
|
|
Stock that
|
|
|
|
|
Options
|
|
Options
|
|
Exercise
|
|
Option
|
|
|
|
Have not
|
|
Have not
|
|
|
Option
|
|
(#)
|
|
(#)
|
|
Price
|
|
Expiration
|
|
Stock Award
|
|
Vested
|
|
Vested(4)
|
Name
|
|
Grant Date(1)
|
|
Exercisable
|
|
Unexercisable
|
|
($)
|
|
Date
|
|
Grant Date
|
|
(#)
|
|
($)
|
|
John W. Chidsey
|
|
|
3/1/04
|
|
|
|
316,922
|
|
|
|
0
|
|
|
|
3.80
|
|
|
|
3/1/14
|
|
|
|
5/17/06
|
|
|
|
84,308
|
(2)
|
|
|
1,455,999
|
|
|
|
|
3/1/04
|
|
|
|
289,807
|
|
|
|
0
|
|
|
|
11.39
|
|
|
|
3/1/14
|
|
|
|
8/21/06
|
|
|
|
142,348
|
(3)
|
|
|
2,458,350
|
|
|
|
|
6/8/04
|
|
|
|
177,573
|
|
|
|
0
|
|
|
|
3.80
|
|
|
|
6/8/14
|
|
|
|
8/27/07
|
|
|
|
86,723
|
(3)
|
|
|
1,497,706
|
|
|
|
|
6/8/04
|
|
|
|
94,715
|
|
|
|
0
|
|
|
|
11.39
|
|
|
|
6/8/14
|
|
|
|
8/22/08
|
|
|
|
77,408
|
(3)
|
|
|
1,336,836
|
|
|
|
|
8/1/04
|
|
|
|
189,396
|
|
|
|
47,350
|
|
|
|
3.80
|
|
|
|
8/1/14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8/27/07
|
|
|
|
60,411
|
|
|
|
181,235
|
|
|
|
23.35
|
|
|
|
8/26/17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8/22/08
|
|
|
|
0
|
|
|
|
230,375
|
|
|
|
26.16
|
|
|
|
8/21/18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ben K. Wells
|
|
|
8/21/05
|
|
|
|
18,073
|
|
|
|
21,078
|
|
|
|
10.25
|
|
|
|
8/21/15
|
|
|
|
8/21/06
|
|
|
|
24,955
|
(3)
|
|
|
430,973
|
|
|
|
|
2/14/06
|
|
|
|
79,038
|
|
|
|
52,693
|
|
|
|
21.64
|
|
|
|
2/14/16
|
|
|
|
8/27/07
|
|
|
|
15,427
|
(3)
|
|
|
266,424
|
|
|
|
|
5/17/06
|
|
|
|
39,467
|
|
|
|
31,616
|
|
|
|
17.00
|
|
|
|
5/16/16
|
|
|
|
8/22/08
|
|
|
|
13,770
|
(3)
|
|
|
237,808
|
|
|
|
|
8/27/07
|
|
|
|
10,746
|
|
|
|
32,241
|
|
|
|
23.35
|
|
|
|
8/26/17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8/22/08
|
|
|
|
0
|
|
|
|
40,981
|
|
|
|
26.16
|
|
|
|
8/21/18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Russell B. Klein
|
|
|
8/21/03
|
|
|
|
118,379
|
|
|
|
0
|
|
|
|
3.80
|
|
|
|
8/21/13
|
|
|
|
8/21/06
|
|
|
|
39,145
|
(3)
|
|
|
676,034
|
|
|
|
|
8/21/05
|
|
|
|
8,083
|
|
|
|
8,084
|
|
|
|
10.25
|
|
|
|
8/21/15
|
|
|
|
8/27/07
|
|
|
|
21,413
|
(3)
|
|
|
369,803
|
|
|
|
|
5/17/06
|
|
|
|
79,038
|
|
|
|
52,693
|
|
|
|
17.00
|
|
|
|
5/16/16
|
|
|
|
8/22/08
|
|
|
|
19,113
|
(3)
|
|
|
330,082
|
|
|
|
|
8/27/07
|
|
|
|
14,916
|
|
|
|
44,749
|
|
|
|
23.35
|
|
|
|
8/26/17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8/22/08
|
|
|
|
0
|
|
|
|
56,882
|
|
|
|
26.16
|
|
|
|
8/21/18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charles M. Fallon, Jr.
|
|
|
5/17/06
|
|
|
|
126,461
|
|
|
|
84,308
|
|
|
|
17.00
|
|
|
|
5/16/16
|
|
|
|
8/21/06
|
|
|
|
22,686
|
(3)
|
|
|
391,787
|
|
|
|
|
6/2/06
|
|
|
|
17,404
|
|
|
|
11,603
|
|
|
|
18.91
|
|
|
|
6/1/16
|
|
|
|
8/27/07
|
|
|
|
13,650
|
(3)
|
|
|
235,736
|
|
|
|
|
8/27/07
|
|
|
|
9,509
|
|
|
|
28,527
|
|
|
|
23.35
|
|
|
|
8/27/17
|
|
|
|
8/22/08
|
|
|
|
13,403
|
(3)
|
|
|
231,470
|
|
|
|
|
8/22/08
|
|
|
|
0
|
|
|
|
39,889
|
|
|
|
26.16
|
|
|
|
8/21/18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter B. Robinson
|
|
|
10/1/06
|
|
|
|
75,000
|
|
|
|
75,000
|
|
|
|
15.96
|
|
|
|
9/30/16
|
|
|
|
8/27/07
|
|
|
|
14,453
|
(3)
|
|
|
249,603
|
|
|
|
|
8/27/07
|
|
|
|
10,068
|
|
|
|
30,206
|
|
|
|
23.35
|
|
|
|
8/26/17
|
|
|
|
8/22/08
|
|
|
|
12,901
|
(3)
|
|
|
222,800
|
|
|
|
|
8/22/08
|
|
|
|
0
|
|
|
|
38,395
|
|
|
|
26.16
|
|
|
|
8/21/18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
All stock options granted prior to August 21, 2006 vest 20%
per year on the anniversary date. All stock options granted on
August 21, 2006 and thereafter vest 25% per year on the
anniversary date.
|
(2)
|
This restricted stock unit award vests in equal installments
over five years, on each anniversary date.
|
(3)
|
These performance-based restricted stock awards vest 100% on the
third anniversary of the grant date with the following
exception: Mr. Chidseys award granted on
August 21, 2006 vests 50% on the third anniversary of the
grant date, and 50% on the fourth anniversary of the grant date.
|
(4)
|
The market value of unvested restricted stock unit awards and
unvested performance-based restricted stock awards has been
established by multiplying the number of unvested shares by
$17.27, which was the closing price of our stock on
June 30, 2009, the last business day of our 2009 fiscal
year.
|
35
2009
OPTION EXERCISES AND STOCK VESTED TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
Stock Awards
|
|
|
Number of Shares
|
|
Value Realized
|
|
Number of Shares
|
|
Value Realized
|
|
|
Acquired on Exercise
|
|
on Exercise(1)
|
|
Acquired on Vesting
|
|
on Vesting(2)
|
Name
|
|
(#)
|
|
($)
|
|
(#)
|
|
($)
|
|
John W. Chidsey
|
|
|
210,000
|
|
|
|
5,505,069
|
|
|
|
42,154
|
|
|
|
732,215
|
|
Ben K. Wells
|
|
|
14,332
|
|
|
|
146,716
|
|
|
|
|
|
|
|
|
|
Russell B. Klein
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charles M. Fallon, Jr.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter B. Robinson
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Values Realized are based on the prices at which the NEO sold
the shares, which were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Shares
|
|
|
|
Per Share Value Realized
|
NEO
|
|
Acquired on Exercise
|
|
Exercise Price ($)
|
|
on Exercise Date ($)
|
|
John W. Chidsey
|
|
|
111,400
|
|
|
|
3.80
|
|
|
|
30.001
|
|
John W. Chidsey
|
|
|
98,600
|
|
|
|
3.80
|
|
|
|
30.03
|
|
Ben K. Wells
|
|
|
2,652
|
|
|
|
17.00
|
|
|
|
25.08
|
|
Ben K. Wells
|
|
|
4,514
|
|
|
|
10.25
|
|
|
|
25.08
|
|
Ben K. Wells
|
|
|
4,514
|
|
|
|
10.25
|
|
|
|
20.89
|
|
Ben K. Wells
|
|
|
2,652
|
|
|
|
17.00
|
|
|
|
20.89
|
|
|
|
(2) |
Value Realized is based on our closing market price of $17.37 on
May 17, 2009 (the vesting date).
|
2009
NONQUALIFIED DEFERRED COMPENSATION TABLE
This table reports the fiscal 2009 contributions by the NEOs and
the Company to the ERP and the aggregate account balances for
the NEOs. Details of the ERP are discussed in the CD&A.
Further details for the NEOs are provided in the 2009 All Other
Compensation Table.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive
|
|
Company
|
|
Aggregate
|
|
Aggregate
|
|
|
|
|
Contributions in
|
|
Contributions in
|
|
Earnings in Last
|
|
Withdrawals /
|
|
Aggregate Balance at
|
|
|
Last Fiscal Year
|
|
Last Fiscal Year
|
|
Fiscal Year
|
|
Distributions
|
|
Last Fiscal Year-End
|
Name
|
|
($)
|
|
($)(1)
|
|
($)(2)
|
|
($)
|
|
($)
|
|
John W. Chidsey
|
|
|
49,718
|
|
|
|
82,047
|
|
|
|
(118,002
|
)
|
|
|
0
|
|
|
|
554,419
|
|
Ben K. Wells
|
|
|
15,717
|
|
|
|
31,053
|
|
|
|
(10,383
|
)
|
|
|
0
|
|
|
|
119,296
|
|
Russell B. Klein
|
|
|
16,362
|
|
|
|
32,788
|
|
|
|
(56,987
|
)
|
|
|
0
|
|
|
|
260,431
|
|
Charles M. Fallon, Jr.
|
|
|
207,458
|
|
|
|
25,447
|
|
|
|
(99,209
|
)
|
|
|
0
|
|
|
|
434,074
|
|
Peter B. Robinson
|
|
|
13,687
|
|
|
|
28,133
|
|
|
|
(3,049
|
)
|
|
|
0
|
|
|
|
120,148
|
|
|
|
(1)
|
Amounts in this column include profit sharing contributions
which were paid in fiscal 2010 but were earned in fiscal 2009.
|
(2)
|
All amounts deferred by the NEO, or credited to his account by
us, earned interest at a rate that reflects the performance of
investment funds that the NEO selected from a pool of funds.
Each NEO may change his selections at any time, subject to any
individual fund restrictions.
|
36
2009
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL
TABLE
The potential payments and benefits that would be provided to
each NEO as a result of certain termination events are set forth
in the table below. Calculations for this table are based on the
assumption that the termination took place on June 30,
2009. The employment agreements we entered into with
Messrs. Chidsey, Wells, Klein, Fallon and Robinson define
cause, good reason and change in
control for purposes of determining severance payments and
benefits. Please refer to the Employment Agreements,
including Change in Control and Severance Arrangements,
and Clawback Policy sections of the CD&A for
additional details on the severance payments and benefits and
change in control provisions that affect our NEOs. As a
condition to receiving any severance payments and benefits, the
NEO must sign a separation agreement and release in a form
approved by the Company.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Termination
|
|
|
|
|
|
|
|
|
|
|
|
w/o Cause
|
|
|
|
|
|
|
|
|
|
|
|
or for
|
|
|
|
|
|
|
|
|
Termination
|
|
|
Good Reason
|
|
|
|
|
|
|
|
|
w/o Cause
|
|
|
After
|
|
|
|
|
|
|
|
|
or for
|
|
|
Change in
|
|
|
Death and
|
|
|
|
|
|
Good Reason
|
|
|
Control
|
|
|
Disability
|
|
Name
|
|
Benefit
|
|
($)(1)(2)
|
|
|
($)(3)(4)(5)
|
|
|
($)(6)
|
|
|
John W. Chidsey
|
|
Severance(7)
|
|
|
2,085,750
|
|
|
|
3,128,625
|
|
|
|
2,085,750
|
|
|
|
Bonus
|
|
|
2,085,750
|
|
|
|
3,128,625
|
|
|
|
2,085,750
|
|
|
|
Accelerated Vesting(8)
|
|
|
N/A
|
|
|
|
7,386,696
|
|
|
|
7,386,696
|
|
|
|
Value of Benefits Continuation(9)
|
|
|
73,486
|
|
|
|
110,230
|
|
|
|
73,486
|
|
|
|
Perquisite Allowance(10)
|
|
|
100,000
|
|
|
|
150,000
|
|
|
|
100,000
|
|
|
|
Outplacement Services(11)
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
Total
|
|
|
4,344,986
|
|
|
|
13,904,176
|
|
|
|
11,731,682
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ben K. Wells
|
|
Severance(7)
|
|
|
494,709
|
|
|
|
494,709
|
|
|
|
N/A
|
|
|
|
Bonus
|
|
|
346,296
|
|
|
|
346,296
|
|
|
|
346,296
|
|
|
|
Accelerated Vesting(8)
|
|
|
N/A
|
|
|
|
1,091,709
|
|
|
|
N/A
|
|
|
|
Value of Benefits Continuation(9)
|
|
|
40,277
|
|
|
|
40,277
|
|
|
|
N/A
|
|
|
|
Perquisite Allowance(10)
|
|
|
35,000
|
|
|
|
35,000
|
|
|
|
N/A
|
|
|
|
Outplacement Services(11)
|
|
|
28,500
|
|
|
|
28,500
|
|
|
|
N/A
|
|
|
|
Total
|
|
|
944,782
|
|
|
|
2,036,491
|
|
|
|
346,296
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Russell B. Klein
|
|
Severance(7)
|
|
|
515,000
|
|
|
|
515,000
|
|
|
|
N/A
|
|
|
|
Bonus
|
|
|
412,000
|
|
|
|
412,000
|
|
|
|
412,000
|
|
|
|
Accelerated Vesting(8)
|
|
|
N/A
|
|
|
|
1,446,895
|
|
|
|
N/A
|
|
|
|
Value of Benefits Continuation(9)
|
|
|
38,215
|
|
|
|
38,215
|
|
|
|
N/A
|
|
|
|
Perquisite Allowance(10)
|
|
|
35,000
|
|
|
|
35,000
|
|
|
|
N/A
|
|
|
|
Outplacement Services(11)
|
|
|
28,500
|
|
|
|
28,500
|
|
|
|
N/A
|
|
|
|
Total
|
|
|
1,028,715
|
|
|
|
2,475,610
|
|
|
|
412,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charles M. Fallon, Jr.
|
|
Severance(7)
|
|
|
437,750
|
|
|
|
437,750
|
|
|
|
N/A
|
|
|
|
Bonus
|
|
|
306,425
|
|
|
|
306,425
|
|
|
|
306,425
|
|
|
|
Accelerated Vesting(8)
|
|
|
N/A
|
|
|
|
881,756
|
|
|
|
N/A
|
|
|
|
Value of Benefits Continuation(9)
|
|
|
36,587
|
|
|
|
36,587
|
|
|
|
N/A
|
|
|
|
Perquisite Allowance(10)
|
|
|
35,000
|
|
|
|
35,000
|
|
|
|
N/A
|
|
|
|
Outplacement Services(11)
|
|
|
28,500
|
|
|
|
28,500
|
|
|
|
N/A
|
|
|
|
Total
|
|
|
844,262
|
|
|
|
1,726,018
|
|
|
|
306,425
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter B. Robinson(12)
|
|
Severance(7)
|
|
|
463,500
|
|
|
|
463,500
|
|
|
|
N/A
|
|
|
|
Bonus
|
|
|
324,450
|
|
|
|
324,450
|
|
|
|
324,450
|
|
|
|
Accelerated Vesting(8)
|
|
|
N/A
|
|
|
|
570,654
|
|
|
|
N/A
|
|
|
|
Value of Benefits Continuation(9)
|
|
|
35,187
|
|
|
|
35,187
|
|
|
|
N/A
|
|
|
|
Perquisite Allowance(10)
|
|
|
35,000
|
|
|
|
35,000
|
|
|
|
N/A
|
|
|
|
Outplacement Services(11)
|
|
|
28,500
|
|
|
|
28,500
|
|
|
|
N/A
|
|
|
|
Total
|
|
|
886,637
|
|
|
|
1,457,291
|
|
|
|
324,450
|
|
|
|
|
|
(1)
|
If Mr. Chidseys employment is terminated without
cause or for good reason or due to his death or disability (as
such terms are defined in his employment agreement), he will be
entitled to receive (i) an amount equal to two times his
|
37
|
|
|
|
|
annual base salary, annual
perquisite allowance and target annual bonus payable over six
months commencing on the first business day following the six
month anniversary of termination, and (ii) continued
coverage under our medical, dental and life insurance plans for
him and his eligible dependents during the two-year period
following termination.
|
|
|
|
|
(2)
|
If any of the NEOs, other than Mr. Chidsey, is terminated
without cause (as such term is defined in the relevant
employment agreement), he will be entitled to receive
(i) his then current base salary and his perquisite
allowance for one year, payable in the case of
Messrs. Wells, Klein and Fallon, over six months commencing
on the first business day following the six month anniversary of
the termination date, and, in the case of Mr. Robinson,
over one year beginning on the termination date, (ii) a
pro-rata bonus for the year of termination and
(iii) continued coverage for one year under our medical,
dental and life insurance plans for him and his eligible
dependents. Additionally, each of the NEOs will receive these
benefits if his employment is terminated for good reason (as
such term is defined in the relevant employment agreement).
|
|
(3)
|
A change in control, without a termination of employment, will
not in itself trigger any severance payments or vesting of
equity. Any payments or equity due upon a change in control and
subsequent termination of employment, either without cause or
for good reason (as defined in the relevant employment
agreement) is included in the Termination w/o Cause or for
Good Reason After Change in Control column of this table.
|
|
(4)
|
If Mr. Chidseys employment is terminated without
cause or he terminates his employment with good reason after a
change in control (as defined in his employment agreement), he
will be entitled to receive an amount equal to three times his
annual base salary, annual perquisite allowance and target
annual bonus. He also will be entitled to continued coverage
under our medical, dental and life insurance plans for him and
his eligible dependents during the three-year period following
termination. Additionally, if Mr. Chidseys employment
is terminated during the
24-month
period after a change in control of the Company either without
cause or for good reason, all options and other equity awards
held by him will vest in full. If Mr. Chidsey resigns for
any reason within the
30-day
period immediately following the one-year anniversary of a
change in control involving a strategic buyer (as determined by
the Board), his resignation would constitute a termination by us
without cause under his employment agreement.
|
|
(5)
|
All equity granted to each of Messrs. Wells, Klein, Fallon
and Robinson will fully vest upon termination if his employment
is terminated at any time within 24 months after a change
in control either without cause or by him for good reason.
|
|
(6)
|
If an NEO dies or becomes disabled (as such term is defined in
the relevant employment agreement), the NEO is entitled to
receive his target bonus, as if he had been employed for the
entire fiscal year. For Mr. Chidsey, any severance payments
made by BKC as a result of his termination upon his death or
disability will be reduced by the value of any BKC paid life and
disability benefits he or his family are entitled to receive.
The term disability is defined in all NEO employment
agreements as a physical or mental disability that prevents or
would prevent the performance by the NEO of his duties under the
employment agreement for a continuous period of six months or
longer.
|
|
(7)
|
Pursuant to the terms of the respective NEOs employment
agreement, each NEO has agreed to non-competition,
non-solicitation and confidentiality restrictions that last for
one year after termination. If the NEO breaches any of these
covenants, we will cease providing any severance and other
benefits to him, and we have the right to require him to repay
any severance amounts already paid. In addition, as a condition
to receiving the separation benefits, each NEO must sign a
separation agreement and release in a form approved by us, which
includes a waiver of all potential claims. Mr. Chidsey,
unlike the other NEOs, is entitled to receive severance upon his
death. In the case of his death, his estate must sign the
release in order to receive severance benefits.
|
|
(8)
|
The amounts in this table represent the fair market value on
June 30, 2009 of the unvested portion of the NEOs
equity that would vest upon the occurrence of a triggering
event. The fair market value of the Companys common stock
on June 30, 2009 was $17.27 per share.
|
|
(9)
|
The NEOs are entitled to continued participation in the
Executive Health Plan for the relevant severance period
specified in Footnotes 1, 2 and 4 above.
|
|
|
(10)
|
The perquisites allowance will be paid to the NEO during the
relevant severance period specified in Footnotes 1 and 2 above.
|
(11)
|
Each NEO, other than Mr. Chidsey, is entitled to receive
outplacement services upon termination of employment without
cause or for good reason. As of June 30, 2009, eligible
NEOs are entitled to receive outplacement services from our
third party service provider for up to one year, which is
currently valued at $28,500.
|
(12)
|
Mr. Robinsons assignment as President, EMEA ended on
September 30, 2009. Commencing October 1, 2009, we
appointed Mr. Robinson to the office of Executive Vice
President and entered into an amendment to his employment
agreement. Pursuant to the amendment, Mr. Robinson is not
entitled to receive any of the severance benefits described
above, except for the accelerated vesting of his equity upon
termination without cause or for good reason after a change in
control. However, under the amendment (i) if we terminate
Mr. Robinsons employment without cause or if
Mr. Robinson terminates his employment for any reason
during our 2010 fiscal year, he will receive a prorated cash
bonus based on 70% of his base salary whether or not we achieve
our specific financial goals for the 2010 fiscal year, or
(ii) if we terminate Mr. Robinsons employment
without cause or if Mr. Robinson terminates his employment
with good reason during any year following the 2010 fiscal year,
he will receive a prorated cash bonus calculated in accordance
with the cash incentive plan then in effect (and determined
based on the extent to which we actually achieve the performance
goals for such year), payable within five business days
following the date annual bonuses are paid for such fiscal year.
|
38
DIRECTOR
COMPENSATION
Under our director compensation program, each non-management
director receives an annual deferred stock award with a grant
date fair value of $85,000. The annual deferred stock grant
vests in quarterly installments over a 12 month period. On
November 20, 2008, the non-management directors received
their annual grant of deferred stock for calendar year 2009. In
addition, the non-management directors receive an annual
retainer of $50,000. The chair of the Audit Committee receives
an additional $20,000 fee and the chairs of the Compensation
Committee and the Nominating and Corporate Governance Committee
each receive an additional $10,000 fee. Directors have the
option to receive their annual retainer and their chair fees
either 100% in cash or 100% in shares of deferred stock.
Directors who elected to receive their 2009 calendar year annual
retainer
and/or chair
fees in deferred stock will receive these deferred stock awards
on November 19, 2009, which is the date of the fiscal 2009
annual shareholders meeting. These awards will be fully
vested on the grant date.
All deferred stock grants, whether the annual grant or deferred
stock granted in lieu of a cash retainer or chair fees, will be
settled upon termination of Board service. No separate committee
fees are paid and no compensation is paid to management
directors for Board or committee service. All directors or their
employers, in the case of the Sponsor directors, are reimbursed
for reasonable travel and lodging expenses incurred by them in
connection with attending Board and committee meetings.
As of July 1, 2008, Mr. Chidsey became our Chairman of
the Board and, as a member of management, he is not entitled to
receive any compensation under our director compensation program.
FISCAL
2009 DIRECTOR COMPENSATION TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fees Earned or
|
|
|
|
All Other
|
|
|
|
|
Paid in Cash
|
|
Stock Awards
|
|
Compensation
|
|
|
Name
|
|
(1)($)
|
|
(2)(3)($)
|
|
($)(4)
|
|
Total($)
|
|
Richard W. Boyce
|
|
|
50,000
|
|
|
|
84,990
|
|
|
|
3,862
|
|
|
|
138,852
|
|
David A. Brandon
|
|
|
50,000
|
|
|
|
84,990
|
|
|
|
3,862
|
|
|
|
138,852
|
|
Ronald M. Dykes
|
|
|
70,000
|
|
|
|
84,990
|
|
|
|
3,240
|
|
|
|
158,230
|
|
Peter R. Formanek
|
|
|
50,000
|
|
|
|
84,990
|
|
|
|
2,873
|
|
|
|
137,863
|
|
Manuel A. Garcia
|
|
|
50,000
|
|
|
|
84,990
|
|
|
|
3,382
|
|
|
|
138,372
|
|
Sanjeev K. Mehra
|
|
|
65,000
|
|
|
|
84,990
|
|
|
|
3,483
|
|
|
|
153,473
|
|
Stephen G. Pagliuca(5)
|
|
|
55,000
|
|
|
|
84,990
|
|
|
|
4,060
|
|
|
|
144,050
|
|
Brian T. Swette
|
|
|
50,000
|
|
|
|
84,990
|
|
|
|
5,130
|
|
|
|
140,120
|
|
Kneeland C. Youngblood
|
|
|
50,000
|
|
|
|
84,990
|
|
|
|
2,873
|
|
|
|
137,863
|
|
|
|
(1) |
Board service fees are calculated based on a calendar year
(January through December), but our fiscal year runs from
July 1st through June 30th. Our non-employee directors
must make their deferral elections prior to January 1st in
order to defer their annual retainers and chair fees for that
year. Therefore, the amounts in this column represent annual
retainers and chair fees for a portion of two calendar years,
one from July 1, 2008 through December 31, 2008 and
the other from January 1, 2009 through June 30, 2009.
The following chart identifies our directors deferral
elections for the portions of calendar years 2008 and 2009
comprising our fiscal year and the fair market value of the 2008
deferred stock award paid in fiscal 2009, which was based on the
closing market price of a share of our common stock on
November 20, 2008. The calendar year 2008 deferred stock
award was granted on November 20, 2008 and the calendar
year 2009 deferred stock award will be granted on
November 19, 2009, and such award will be based on the
closing market price of a share of our common stock on such date.
|
39
|
|
|
|
|
|
|
Deferral Elections for July 1, 2008
|
|
Deferral Election for January 1, 2009
|
|
|
through December 31, 2008
|
|
through June 30, 2009
|
Director
|
|
Retainer and Chair Fees
|
|
Retainer and Chair Fees
|
|
Richard W. Boyce, David A. Brandon
Manual A. Garcia and Brian Swette
|
|
Deferred Retainer: $25,000 value
|
|
Deferred Retainer: $25,000 value
|
Sanjeev Mehra
|
|
Deferred Retainer and Chair Fee: $30,000 value
|
|
Deferred Retainer and Chair Fees: $35,000 value
|
Stephen G. Pagliuca
|
|
Deferred Retainer and Chair Fee: $30,000 value
|
|
Deferred Retainer: $25,000 value
|
Ronald M. Dykes
|
|
Deferred Retainer and Chair Fee: $35,000 value
|
|
Deferred Retainer and Chair Fee: $35,000 value
|
Peter R. Formanek and
Kneeland C. Youngblood
|
|
No Deferral: Cash $25,000
|
|
No Deferral: Cash $25,000
|
|
|
(2)
|
The grant date fair value of these awards is based on the
closing market price of a share of our common stock on the
November 20, 2008 grant date ($18.44 per share) for all
directors, which is also the compensation cost for this grant
recognized for financial statement reporting purposes in
accordance with FAS 123R. The assumptions and methodology
used to calculate the compensation cost are set forth in
Note 3 to our Consolidated Financial Statements included in
our
Form 10-K
for fiscal 2009.
|
(3)
|
As of June 30, 2009, Mr. Formanek was the only
director to have options outstanding. As of such date,
Mr. Formanek held 75,587 vested options. As of
June 30, 2009, all of our directors had the following
deferred stock awards outstanding: Messrs, Boyce and Brandon
17,278 shares, Mr. Dykes, 15,059 shares;
Messrs. Formanek and Youngblood, 12,645 shares;
Mr. Garcia, 15,356; Mr. Mehra, 15,898 shares;
Mr. Pagliuca, 18,204 shares; and Mr. Swette,
22,555 shares.
|
(4)
|
Quarterly dividends in the amount of $0.0625 per share were paid
by the Company to shareholders of record as of
September 12, 2008, December 10, 2008, March 16,
2009 and June 10, 2009. The amounts reflected in this
column represent dividend equivalents accrued on vested and
unvested deferred stock issued by the Company to the directors.
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(5)
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Mr. Pagliuca resigned from the Board effective
September 21, 2009. Mr. Pagliuca elected to defer his
calendar 2009 annual retainer, but because his resignation was
effective prior to the date his deferred stock award was issued,
he received a cash payment of $38,681 in lieu of deferred stock.
This amount represented his retainer for the period commencing
January 1, 2009 through September 21, 2009, including
the chair fee for the period commencing July 1, 2009
through September 21, 2009. Mr. Pagliuca was not
entitled to chair fees for the period from January 1, 2009
through June 30, 2009 because he resigned from the
Compensation Committee on November 19, 2008 and was not
reappointed to the Committee until July 1, 2009. Upon
termination of service, his vested deferred stock settled and
the unvested portion was forfeited. Upon his resignation, we
issued 17,051 shares of stock to Mr. Pagliuca in
settlement of his vested deferred stock, and the remaining
1,153 shares of unvested deferred stock issued to
Mr. Pagliuca were forfeited. Mr. Pagliuca also
received $7,742.45 in dividend equivalents accrued on his vested
and unvested deferred stock.
|
COMPENSATION
COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The following non-management directors currently serve on the
Compensation Committee of the Board of Directors: Peter R.
Formanek and Sanjeev K. Mehra. During fiscal 2009,
Mr. Pagliuca served on the Compensation Committee from
July 1, 2008 until November 19, 2008. From
November 19, 2008 until June 30, 2009, the
Compensation Committee was composed of Messrs. Mehra
(Chairman) and Formanek. On July 1, 2009, the Board
determined that Mr. Pagliuca was independent under the
Independence Standards, and Mr. Pagliuca was reappointed to
the Compensation Committee as its Chairman, effective
July 1, 2009. On September 21, 2009, Mr. Pagliuca
resigned from the Board of Directors and the Compensation
Committee. No directors on the Compensation Committee are or
have been officers or employees of the Company or any of its
subsidiaries. None of our executive officers served on the board
of directors or compensation committee of another entity, one of
whose executive officers served on the Companys Board of
Directors or its Compensation Committee.
40
STOCK
OWNERSHIP INFORMATION
Security
Ownership of Certain Beneficial Owners, Directors and
Management
The following table sets forth certain information as of
September 22, 2009, regarding the beneficial ownership of
our common stock by:
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Each of our directors and NEOs;
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All directors and executive officers as a group; and
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Each person or entity who is known to us to be the beneficial
owner of more than 5% of our common stock.
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As of September 22, 2009, our outstanding equity securities
consisted of 135,175,219 shares of common stock. The number
of shares beneficially owned by each stockholder is determined
under rules promulgated by the SEC and generally includes voting
or investment power over the shares. The information does not
necessarily indicate beneficial ownership for any other purpose.
Under the SEC rules, the number of shares of common stock deemed
outstanding includes shares issuable upon the conversion of
other securities, as well as the exercise of options or the
settlement of restricted stock units held by the respective
person or group that may be exercised or settled on or within
60 days of September 22, 2009. For purposes of
calculating each persons or groups percentage
ownership, shares of common stock issuable pursuant to stock
options and restricted stock units that may be exercised or
settled on or within 60 days of September 22, 2009 are
included as outstanding and beneficially owned by that person or
group but are not treated as outstanding for the purpose of
computing the percentage ownership of any other person or group.
Unless otherwise indicated, the address for each listed
stockholder is:
c/o Burger
King Holdings, Inc., 5505 Blue Lagoon Drive, Miami, Florida
33126. To our knowledge, except as indicated in the footnotes to
this table and pursuant to applicable community property laws,
the persons named in the table have sole voting and investment
power with respect to all shares of common stock beneficially
owned by them.
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Common Stock, Par Value
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$.01 Per Share
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Percentage
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Name and Address of Beneficial Owner
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Number
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of Class
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Named Executive Officers and Directors
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John W. Chidsey(1)
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1,790,555
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1.3
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%
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Ben K. Wells(1)
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199,503
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*
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Russell B. Klein(1)
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378,373
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*
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Charles M. Fallon, Jr.(1)
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213,410
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*
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Peter B. Robinson(1)
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142,235
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*
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Richard W. Boyce(1)
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17,278
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*
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David M. Brandon(1)
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27,278
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*
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Ronald M. Dykes(1)
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15,059
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*
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Peter R. Formanek(1)
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228,232
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*
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Manuel A. Garcia(1)
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77,919
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*
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Sanjeev K. Mehra(1)(2)(5)
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13,938,067
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10.3
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%
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Brian T. Swette(1)
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123,180
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*
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Kneeland C. Youngblood(1)
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12,645
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*
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All Executive Officers and Directors as a group
(17 persons)(1)
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17,571,049
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12.8
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%
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5% Stockholders
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FMR LLC(3)
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14,608,506
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10.8
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%
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Investment funds affiliated with Bain Capital Investors, LLC(4)
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13,581,276
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10.0
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%
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Investment funds affiliated with The Goldman Sachs Group, Inc.(5)
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13,938,067
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10.3
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%
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TPG BK Holdco LLC(6)
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15,131,497
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11.2
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%
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41
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* |
Less than one percent (1%)
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(1)
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Includes beneficial ownership of shares of common stock for
which the following persons hold options exercisable on or
within 60 days of September 22, 2009:
Mr. Chidsey, 1,294,179 shares; Mr. Wells,
178,855 shares; Mr. Klein, 253,595 shares;
Mr. Fallon, 172,856 shares; Mr. Robinson,
142,235 shares; Mr. Formanek, 75,587 shares; and
all directors and executive officers as a group,
2,338,357 shares. Also includes beneficial ownership of
shares of common stock underlying deferred stock units held by
the following persons that have vested or will vest on or within
60 days of September 22, 2009 and will be settled upon
termination of Board service: each of Messrs. Boyce and
Brandon, 17,278 shares; Mr. Dykes, 15,059 shares;
each of Mr. Formanek and Mr. Youngblood,
12,645 shares; Mr. Garcia, 15,356 shares;
Mr. Mehra, 15,898 shares; Mr. Swette,
22,555 shares; and all non-employee directors as a group,
128,714 shares. See Footnotes 2 and 5 below for more
information regarding the deferred stock held by Mr. Mehra.
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(2)
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Mr. Mehra is a managing director of Goldman,
Sachs & Co. Mr. Mehra and The Goldman Sachs
Group, Inc. each disclaims beneficial ownership of the shares of
common stock owned directly or indirectly by the Goldman Sachs
Funds and Goldman, Sachs & Co., except to the extent
of his or its pecuniary interest therein, if any. Goldman,
Sachs & Co. disclaims beneficial ownership of the
shares of common stock owned directly or indirectly by the
Goldman Sachs Funds, except to the extent of its pecuniary
interest therein, if any. Mr. Mehra has an understanding
with The Goldman Sachs Group, Inc. pursuant to which he holds
the deferred stock units he receives in his capacity as a
director of the Company for the benefit of The Goldman Sachs
Group, Inc. See Footnote 5 below for information regarding The
Goldman Sachs Group, Inc.
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(3)
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The shares included in the table are based solely on Amendment
No. 2 to the Schedule 13G filed with the SEC on
March 10, 2009 by FMR LLC. FMR LLC filed the amended
Schedule 13G on a voluntary basis as if all of the shares
are beneficially owned by FMR LLC and Fidelity International
Limited (FIL) on a joint basis, but each is of the
view that the shares held by the other need not be aggregated
for purposes of Section 13(d). FMR LLC has the sole power
to vote or to direct the vote regarding 2,216,806 of these
shares and the sole power to dispose or to direct the
disposition of 14,608,506 of these shares. FIL has the sole
power to vote or to direct the vote regarding 1,533,114 of these
shares and the sole power to dispose or to direct the
disposition of 1,550,214 of these shares. The business address
of FMR LLC is 82 Devonshire Street, Boston, MA 02109.
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(4)
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The shares included in the table consist of:
(i) 10,403,858 shares of common stock owned by Bain
Capital Integral Investors, LLC, whose administrative member is
Bain Capital Investors, LLC (BCI);
(ii) 3,117,905 shares of common stock owned by Bain
Capital VII Coinvestment Fund, LLC, whose managing and sole
member is Bain Capital VII Coinvestment Fund, L.P., whose
general partner is Bain Capital Partners VII, L.P., whose
general partner is BCI and (iii) 59,513 shares of
common stock owned by BCIP TCV, LLC, whose administrative member
is BCI. The shares included in the table are based solely on the
Form 4 filed with the SEC on May 12, 2008 by BCI on
behalf of itself and its reporting group. The business address
of BCI is 111 Huntington Avenue, Boston, MA 02199.
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(5)
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The Goldman Sachs Group, Inc., and certain affiliates,
including, Goldman, Sachs & Co., may be deemed to
directly or indirectly own the shares of common stock which are
owned directly or indirectly by investment partnerships, which
The Goldman Sachs Group, Inc. refers to as the Goldman Sachs
Funds, of which affiliates of The Goldman Sachs Group, Inc. and
Goldman Sachs & Co. are the general partner, managing
limited partner or the managing partner. Goldman,
Sachs & Co. is the investment manager for certain of
the Goldman Sachs Funds. Goldman, Sachs & Co. is a
direct and indirect, wholly owned subsidiary of The Goldman
Sachs Group, Inc. The Goldman Sachs Group, Inc., Goldman,
Sachs & Co. and the Goldman Sachs Funds share voting
and investment power with certain of their respective
affiliates. Shares beneficially owned by the Goldman Sachs Funds
consist of: (i) 7,262,660 shares of common stock owned
by GS Capital Partners 2000, L.P.;
(ii) 2,638,973 shares of common stock owned by GS
Capital Partners 2000 Offshore, L.P.;
(iii) 303,562 shares of common stock owned by GS
Capital Partners 2000 GmbH & Co. Beteiligungs KG;
(iv) 2,306,145 shares of common stock owned by GS
Capital Partners 2000 Employee Fund, L.P.;
(v) 106,837 shares of common stock owned by Bridge
Street Special Opportunities Fund 2000, L.P.;
(vi) 213,675 shares of common stock owned by Stone
Street Fund 2000, L.P.; (vii) 356,124 shares of common
stock owned by Goldman Sachs Direct Investment Fund 2000, L.P.;
(viii) 412,941 shares of common stock owned by GS
Private Equity Partners 2000, L.P.;
(ix) 141,944 shares of common stock owned by GS
Private Equity Partners 2000 Offshore Holdings, L.P.; and
(x) 157,364 shares of common stock owned by GS Private
Equity Partners
2000-Direct
Investment Fund, L.P.
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42
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Goldman Sachs Execution & Clearing, L.P. beneficially
owns directly and The Goldman Sachs Group, Inc. may be deemed to
beneficially own indirectly 3,520 shares of common stock.
Goldman, Sachs & Co. beneficially owns directly and
The Goldman Sachs Group, Inc. may be deemed to beneficially own
indirectly 10,100 shares of common stock. Goldman,
Sachs & Co. and The Goldman Sachs Group, Inc. may each
be deemed to beneficially own indirectly, in the aggregate,
13,900,225 shares of common stock through certain limited
partnerships described in this footnote, of which affiliates of
Goldman, Sachs & Co. and The Goldman Sachs Group, Inc.
are the general partner, managing general partner, managing
partner, managing member or member. Goldman, Sachs &
Co. is a wholly-owned subsidiary of The Goldman Sachs Group,
Inc. Goldman, Sachs & Co. is the investment manager of
certain of the limited partnerships.
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The Goldman Sachs Group, Inc. may be deemed to beneficially own
24,222 shares of common stock pursuant to the 2006 Omnibus
Incentive Plan, consisting of 15,898 deferred shares granted to
Sanjeev K. Mehra, a managing director of Goldman,
Sachs & Co. in his capacity as a director of the
Company, and 8,324 deferred shares granted to Adrian M. Jones, a
managing director of Goldman, Sachs & Co., in his
capacity as a director of the Company at the time of the grant.
Mr. Mehra has an understanding and Mr. Jones had an
understanding with The Goldman Sachs Group, Inc. pursuant to
which he holds such deferred shares for the benefit of The
Goldman Sachs Group, Inc. The grant of 24,222 deferred shares is
fully vested or will vest within 60 days of
September 22, 2009. The deferred shares granted to
Mr. Mehra will be settled upon termination of Board service
and the deferred shares granted to Mr. Jones were settled
upon termination of his board service effective as of
June 30, 2008. Each of Goldman, Sachs & Co. and
The Goldman Sachs Group, Inc. disclaims beneficial ownership of
the deferred shares of common stock except to the extent of its
pecuniary interest therein.
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The shares included in the table are based solely on the
Form 4 filed with the SEC on August 18, 2009 by The
Goldman Sachs Group, Inc. on behalf of itself and its reporting
group. The business address for The Goldman Sachs Group, Inc. is
85 Broad Street, New York, NY 10004.
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(6)
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The shares included in the table are directly held by TPG BK
Holdco LLC. TPG Advisors III, Inc., a Delaware corporation
(Advisors III), is the sole general partner of TPG
GenPar III, L.P., a Delaware limited partnership, which in turn
is the sole general partner of TPG Partners III, L.P., a
Delaware limited partnership, which in turn is the managing
member of TPG BK Holdco LLC. David Bonderman and James Coulter
are directors, officers and sole shareholders of Advisors III,
and therefore, David Bonderman, James Coulter and
Advisors III may each be deemed to beneficially own the
shares directly held by TPG BK Holdco LLC. The shares included
in this table are based solely on the Form 4 filed with the
SEC on May 12, 2008 by Advisors III. The business address
for TPG BK Holdco LLC is
c/o TPG
Capital, L.P., 301 Commerce Street, Suite 3300,
Fort Worth, TX 76102.
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SECTION 16(a)
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires our directors,
executive officers and beneficial owners of more than 10% of any
class of our equity securities to file reports of ownership and
changes in ownership of our common stock. To the best of our
knowledge, all required reports were filed on time and all
transactions by our directors, executive officers and beneficial
owners of more than 10% of any class of our equity securities
were reported on time, except for a Form 4 filed for
Sanjeev Mehra, one of our directors, on May 6, 2009. The
failure to timely report was inadvertent and, as soon as the
oversight was discovered, the Form 4 was promptly filed.
CERTAIN
RELATIONSHIPS AND RELATED PERSON TRANSACTIONS
Related
Person Transactions Policy
In May 2007, our Board of Directors adopted a written related
person transactions policy, which is administered by the Audit
Committee. This policy applies to any transaction or series of
related transactions or any material amendment to any such
transaction involving a related person and the Company or any
subsidiary of the Company. For the purposes of the policy,
related persons consist of executive officers,
directors, director nominees, any shareholder beneficially
owning more than 5% of the Companys common stock, and
immediate family members of any such persons. In reviewing
related person transactions, the Audit
43
Committee takes into account all factors that it deems
appropriate, including whether the transaction is on terms no
less favorable than terms generally available to an unaffiliated
third party under the same or similar circumstances and the
extent of the related persons interest in the transaction.
No member of the Audit Committee may participate in any review,
consideration or approval of any related person transaction in
which the director or any of his immediate family members is the
related person. The related person transactions discussed below
were entered into before the adoption of this written policy.
Shareholders
Agreement
In connection with our acquisition of Burger King Corporation
(BKC), we entered into a shareholders
agreement dated June 27, 2003 with BKC and the private
equity funds controlled by the Sponsors, which was amended and
restated on May 17, 2006 (the Shareholders
Agreement). The Shareholders Agreement provides for
(i) the right of each Sponsor to appoint two members to our
Board, (ii) the right of each Sponsor, with respect to each
committee of the Board other than the Audit Committee, to have
at least one Sponsor director on each committee, for Sponsor
directors to constitute a majority of the membership of each
committee and for the chairmen of the committees to be Sponsor
directors, to the extent that such directors are permitted to
serve on such committees under SEC and NYSE rules applicable to
the Company, (iii) drag-along and tag-along rights and
transfer restrictions, (iv) shelf, demand and piggyback
registration rights and (v) the payment of expenses and the
grant of certain indemnities relating to those registration
rights. A Sponsors right to appoint directors will be
reduced to one director if the stock ownership of the private
equity funds controlled by that Sponsor drops to 10% or less of
our outstanding common stock, and will be eliminated if the
stock ownership of the private equity funds controlled by that
Sponsor drops to 2% or less of our outstanding common stock. The
right to appoint directors to board committees terminates if the
private equity funds controlled by the Sponsors no longer
collectively beneficially own 30% or more of our outstanding
common stock. Two of our current directors, Messrs. Boyce
and Mehra, were appointed pursuant to the Shareholders
Agreement. Mr. Pagliuca, who resigned effective
September 21, 2009, had been appointed pursuant to the
Shareholders Agreement. As a result of
Mr. Pagliucas resignation, there is currently a
vacancy on the Board that will be filled by Bain Capital
Partners pursuant to the Shareholders Agreement.
The Shareholders Agreement also includes customary
indemnification provisions against liabilities under the
Securities Act incurred in connection with the registration of
our debt or equity securities. We agreed to reimburse legal or
other expenses incurred in connection with investigating or
defending any such liability, action or proceeding, except that
we will not be required to indemnify or reimburse related legal
or other expenses if such loss or expense arises out of or is
based on any untrue statement or omission made in reliance upon
and in conformity with written information provided by these
persons.
Expense
Reimbursement to the Sponsors
We have reimbursed the Sponsors for certain travel-related
expenses of their employees who are members of our Board in
connection with meetings of the Board of Directors in amounts
that are consistent with amounts reimbursed to the non-Sponsor
directors.
OTHER
BUSINESS
The Board and management do not know of any other matters to be
presented at the annual meeting.
44
SHAREHOLDER
PROPOSALS AND NOMINATIONS FOR 2010 ANNUAL MEETING
Inclusion
of Proposals in the Companys Proxy Statement and Proxy
Card under the SEC Rules
In order to be considered for inclusion in the proxy statement
distributed to shareholders prior to the annual meeting of
shareholders in 2010, a shareholder proposal pursuant to
Rule 14a-8
under the Exchange Act must be received by us no later than
June 10, 2010 and must comply with the requirements of SEC
Rule 14a-8.
Written requests for inclusion should be addressed to: Burger
King Holdings, Inc., 5505 Blue Lagoon Drive, Miami, Florida
33126, Attention: General Counsel and Secretary. We suggest that
you mail your proposal by certified mail, return receipt
requested.
Advance
Notice Requirements for Shareholder Submission of Nominations
and Proposals
A shareholder recommendation for nomination of a person for
election to the Board of Directors or a proposal for
consideration at the 2010 annual meeting of shareholders must be
submitted in accordance with the advance notice procedures and
other requirements in the Companys bylaws. These
requirements are separate from, and in addition to, the
requirements discussed above to have the shareholder proposal
included in our proxy statement and form of proxy/voting
instruction card pursuant to the SECs rules.
Our bylaws require a shareholder who wants to nominate a
director or submit a shareholder proposal be a stockholder of
record at the time of giving the notice and the time of the
meeting, be entitled to vote at the meeting and comply with the
advance notice provisions of our bylaws.
Our bylaws require that shareholder recommendations for nominees
to the Board must include the name of the nominee or nominees,
all information relating to such person that is required to be
disclosed in a proxy statement, a consent signed by the nominee
evidencing a willingness to serve as a director, if elected, and
disclosure of any material relationship between the shareholder
or the beneficial owner and the proposed nominee or nominees,
including any material interest in such business of the
shareholder or the beneficial owner.
Our bylaws require that shareholder proposals include a brief
description of the business to be brought before the meeting,
the text of the proposal or business, the reasons for conducting
such business at the meeting, and any material interest of such
shareholder or the beneficial owner, if any, on whose behalf the
proposal is made in such business. In order to be considered
timely pursuant to
Rule 14a-4
and 14a-5(e)
of the Exchange Act, under the advance notice requirements of
our bylaws the proposal or recommendation for nomination must be
received by the Companys General Counsel and Secretary at
least 90 days but no more than 120 days prior to the
first anniversary of the previous years annual meeting.
For the 2010 annual meeting of shareholders, a proposal or
recommendation for nomination must be received by the
Companys General Counsel and Secretary not earlier than
July 22, 2010 and not later than August 21, 2010. If
no annual meeting was held in the previous year or if the date
of the annual meeting is more than 30 days from the date of
the previous years annual meeting, then the proposal or
recommendation must be received not later than the close of
business on the 90th day prior to the annual meeting or the 10th
day following the day on which notice of the date of the 2010
annual meeting is mailed or publicly disclosed or such proposal
will be considered untimely pursuant to
Rule 14a-4
and 14a-5(e)
of the Exchange Act. Except for proposals properly made in
accordance with
Rule 14a-8
under the Exchange Act and included in the notice of meeting
given by or at the direction of the Board of Directors, the
advance notice provisions of the bylaws shall be the exclusive
means for a stockholder to propose business to be brought before
an annual meeting of shareholders.
In addition, our bylaws require that the shareholder giving
notice and the beneficial owner, if any, on whose behalf the
proposal is made, must also include (i) the name and
address of the shareholder, (ii) the class and number of
shares beneficially owned and held of record by the shareholder
and the beneficial owner, (iii) any derivative, swap or any
other transaction or series of transactions engaged in, directly
or indirectly by the shareholder or the beneficial owner the
purpose or effect of which is to give the shareholder or
beneficial owner economic risk similar to ownership of shares in
the Company, (iv) a representation that the shareholder is
the holder of record of the shares entitled to vote at the
meeting and intends to appear in person or by proxy at the
meeting to present the proposal or nomination, and (v) a
representation that the shareholder or the
45
beneficial owner intends to be or is a part of a group which
intends to deliver a proxy statement or a form of proxy to the
holders of at least the percentage of the Companys
outstanding shares required to approve or adopt the proposal or
elect the nominee, or otherwise plans to solicit proxies from
stockholders in support of the nomination or proposal.
Householding
of Proxy Materials
The SEC has adopted rules that permit companies and
intermediaries such as brokers to satisfy delivery requirements
for proxy statements and annual reports with respect to two or
more shareholders sharing the same address by delivering a
single proxy statement and annual report addressed to those
shareholders. This process, which is commonly referred to as
householding, potentially provides extra convenience
for shareholders and cost savings for companies. The Company and
some brokers household proxy materials, delivering a single
proxy statement and annual report to multiple shareholders
sharing an address unless contrary instructions have been
received from the affected shareholders.
Once you have received notice from your broker or us that each
of us will be householding materials to your address,
householding will continue until you are notified otherwise or
until you revoke your consent. If, at any time, you no longer
wish to participate in householding and would prefer to receive
a separate proxy statement and annual report, or if you are
receiving multiple copies of the proxy statement and annual
report and wish to receive only one, please notify your broker
if your shares are held in a brokerage account or the Company if
you hold registered shares. You can notify us by sending a
written request to Burger King Holdings, Inc., Investor
Relations, 5505 Blue Lagoon Drive, Miami, Florida 33126 or by
contacting the SVP, Investor Relations and Global Communications
at
(305) 378-7696.
Annual
Report on
Form 10-K
This proxy solicitation material has been mailed to certain of
our shareholders with the annual report on
Form 10-K
to shareholders for the fiscal year ended June 30, 2009;
however, it is not intended that the annual report on
Form 10-K
be a part of the proxy statement or this solicitation of proxies.
Shareholders are respectfully urged to vote their shares as
promptly as possible.
By Order
of the Board of Directors,
Anne Chwat
General Counsel and Secretary
October 8, 2009
46
Reedgarize PN
650 Annual Meeting of BURGER KING HOLDINGS, INC. |
ANNUAL MEETING OF BURGER KING HOLDINGS, INC. to be held on Thursday, November 19, 2009
Date: November 19, 2009 This proxy is being solicited on behalf of the Board of Directors |
Time: 9:00 A.M. (Eastern Standard Time)
Place: Hilton Miami Airport, 5101 Blue Lagoon Drive, Miami, FL 33126 VOTED BY: |
Please make your marks like this: Use dark black pencil or pen only . INTERNET TELEPHONE provided
Go To 1-866-390-5360 |
Board of Directors Recommends a Vote FOR the Following Proposals. www.proxypush.com/bkc sUse any touch-tone telephone. |
1. To elect nine (9) directors for a term to expire at the 2010 annual sCast your vote online.
OR envelope sHave your Proxy Card ready. meeting of shareholders. sView Meeting Documents.
sFollow the simple recorded instructions. |
01 John W. Chidsey 06 Manuel A. Garcia OR sMark, sign and date your Proxy Card. 02 Richard W.
Boyce 07 Sanjeev K. Mehra in the sDetach your Proxy Card.
03 David A. Brandon 08 Brian T. Swette sReturn your Proxy Card in the postage-paid
04 Ronald M. Dykes 09 Kneeland C. Youngblood portion envelope provided. 05 Peter R.
Formanek |
The undersigned hereby appoints Adam T. Smith and Jose A. Segrera, and each of them
individually, as attorneys and proxies of the undersigned, with full power of substitution, for and
in the name, place and stead of Vote For Withhold Vote *Vote For the undersigned, to vote all of
the shares of common stock, par value $0.001 per share, of Terremark Worldwide, All Nominees From
All Nominees All Except Inc. (the Company), which the undersigned may be entitled to vote at our
2009 Annual Meeting of Stockholders to be held at 10:00 a.m. on Friday, September 11, 2009, at the
NAP of the Americas, located at 50 Northeast 9th Street, Miami, Florida 33132, and at any and all
postponements, continuations and adjournments thereof, with *INSTRUCTIONS: To withhold authority to
vote for all powers that the undersigned would possess if personally present, upon and in respect
of the following matters any nominee, mark the Exception box and write the and in accordance with
the following instructions, with discretionary authority as to any and all other matters that
number(s) of the nominee(s) from whom you want to and return just this withhold your vote in the
space to the right. may properly come before the meeting. perforation |
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE
VOTED AS DIRECTED BY THE SHAREHOLDER(S). |
2. To ratify the selection of KPMG LLP as the independent registered public IF NO SUCH
DIRECTIONS ARE MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE accounting firm for the
Company for the fiscal year ending June 30, 2010. NOMINEES LISTED FOR THE BOARD OF DIRECTORS
AND FOR PROPOSAL 2. |
For Against Abstain at the All votes must be received by 11:59 P.M., Eastern Standard Time,
November 18, 2009. carefully |
Please indicate if you plan to attend this meeting: |
For address changes and/or comments, please write
them on back where indicated. separate |
BURGER KING HOLDINGS, INC. |
Authorized Signatures This section must be C/O MEDIANT COMMUNICATIONS, LLC. completed for your
Instructions to be executed. P.O. BOX 8016 |
Please CARY, NC 27512-9903 |
Please Sign Here Please Date Above
Please Sign Here Please Date Above |
NOTE: Your signature should appear exactly the same as your
name appears hereon. If signing as OFFICE # partner,
attorney, executor, administrator, trustee or guardian,
please indicate the capacity in which signing. When signing
as joint tenants, all parties in the joint tenancy must
sign. When a proxy is given by a corporation, it should be
signed by an authorized officer and the corporate seal
affixed. No postage is required if mailed within the United
States. |
Revocable Proxy BURGER KING HOLDINGS, INC. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS Annual Meeting of Stockholders ANNUAL MEETING OF SHAREHOLDERS November 19, 2009, 9:00
A.M. (Eastern Standard Time) NOVEMBER 19, 2009 This Proxy is Solicited on Behalf of the Board of
Directors |
The shareholder(s) hereby appoint(s) Anne Chwat and Ben K. Wells, The undersigned hereby
revokes any proxy or proxies heretofore given, and ratifies and or either of them, as proxies, each
with the power to appoint his or her confirms that the proxies appointed hereby, or any of them, or
their substitute or substitutes, substitute, and hereby authorize(s) them to represent and to vote,
as may lawfully do or cause to be done by virtue thereof. designated on the reverse side of this
ballot, all of the shares of Common |
Stock of Burger King Holdings, Inc. that the shareholder(s) is/are entitled This proxy is
revocable and will be voted as directed, but if no instructions are specified, this to vote at the
Annual Meeting of Shareholders to be held at 9:00 A.M., proxy will be voted: Eastern Standard Time
on November 19, 2009, at the Hilton Miami Airport, 5101 Blue Lagoon Drive, Miami, FL 33126, and any
adjournment |
FOR the nominees for directors specified or postponement thereof. |
FOR the proposal to ratify the selection of KPMG LLP as the Companys Independent Please THIS
PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED Registered Public Accounting Firm for the
year ending June 30, 2010 separate BY THE SHAREHOLDER(S). IF NO SUCH DIRECTIONS ARE MADE, THIS
PROXY WILL BE VOTED FOR THE ELECTION OF THE NOMINEES LISTED |
ON THE REVERSE SIDE
FOR THE BOARD OF DIRECTORS
AND FOR PROPOSAL 2.
carefully |
PLEASE MARK, SIGN,
DATE AND RETURN THIS PROXY
CARD PROMPTLY USING THE
ENCLOSED REPLY ENVELOPE at
the Address perforation
Changes/Comments: |
and return just
this portion in the
envelope
provided
. |