Pizza Hut 2008 Annual Report Download - page 37

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income, revenue growth, shareholder return, system sales, gross margin management, market share
improvement, market value added, restaurant development, customer satisfaction or economic value
added. To satisfy the requirements that apply to performance-based compensation, these goals must be
approved by the Company’s shareholders, and approval of the Incentive Plan, as amended by the First and
Second Amendments, will also constitute approval of the foregoing goals.
Payments. A Participant’s eligibility for payment with respect to an Award for a Performance Period
shall be determined by the Committee. Prior to the payment with respect to any Award designated as
intended to satisfy the requirements for performance-based compensation, the Committee will certify the
attainment of the performance goal(s) and any other material terms. The Committee may adjust Awards
for individual performance on the basis of such quantitative and qualitative performance measures and
evaluations as it deems appropriate. The Committee may make such adjustments as it deems appropriate
in the case of any Participant whose position with the Company has changed during the applicable
Performance Period. The Committee shall have the discretion to adjust performance goals and the
methodology used to measure the determination of the degree of attainment of such goals; provided,
however, that, to the extent required by the requirements applicable to performance-based compensation,
any Award designated as intended to satisfy the requirements for performance-based compensation may
not be adjusted to increase the value of such Award. Except as otherwise provided by the Committee, the
Committee shall retain the discretion to adjust such Awards in a manner that does not increase such
Awards. In no event will a Participant become eligible for payment for an Award for any calendar year in
excess of $10,000,000.
Withholding Taxes. The Company shall have the right to deduct from all payments under the
Incentive Plan any taxes required to be withheld with respect to such payments.
Change in Control. In the event of a change in control of the Company, as defined in the Yum!
Brands, Inc. Long Term Incentive Plan, the Performance Period will be deemed to have concluded on the
date of the change of control and each Participant will receive a pro rata amount (based on the number of
days in such Performance Period elapsed through the date of the change of control) equal to the greater of
the Participant’s target amount or the amount the Participant would have earned for the Performance
Period assuming continued achievement of the relevant performance goals at the rate achieved as of the
Proxy Statement
date of the change of control.
Return of Overpayments. The Incentive Plan provides that if an amount paid is based on attainment
of a level of objective performance goals that was overstated as a result of misconduct, with the result that
the payment was larger than it should have been, the Committee may require that the excess be repaid to
the Company.
Administration. The Incentive Plan is administered by a committee (the ‘‘Committee’’) selected by
the Board and consisting solely of two or more non-employee members of the Board. The Committee will
have the authority and discretion to select from among the Eligible Employees those persons who shall
receive Awards, to determine the time or times of payment with respect to the Awards, to establish the
terms, conditions, performance goals, restrictions, and other provisions of such Awards, and to cancel or
suspend Awards. The Committee will have the authority and discretion to interpret the Incentive Plan, to
establish, amend, and rescind any rules and regulations relating to the Incentive Plan, to determine the
terms and provisions of any Award made pursuant to the Incentive Plan, and to make all other
determinations that may be necessary or advisable for the administration of the Incentive Plan. Any
interpretation of the Incentive Plan by the Committee and any decision made by it under the Incentive
Plan is final and binding on all persons. The Committee may allocate all or any portion of its
responsibilities and powers to any one or more of its members and may delegate all or any part of its
responsibilities and powers to any person or persons selected by it. Until action to the contrary is taken by
the Committee, the Committee’s authority with respect to matters concerning Participants below the
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