Pizza Hut 2009 Annual Report Download - page 43

21MAR201012032309
wishes of the majority of shareholders. In addition, the Board considered the following factors before
deciding to recommend that you vote against this proposal:
• Shareholders have significant opportunity to raise matters at our annual meetings and have
frequently done so.
• A special meeting should only be held to cover extraordinary events when fiduciary or strategic
issues or a significant transaction dictate addressing matters on an expeditious basis.
• Controlling the timing of a regular or special meeting should remain in the hands of the Board to
enable them to discharge their fiduciary duties to all shareholders.
• The 10% threshold could provide a forum for parties holding a minority portion of all shares to call
meetings that would serve narrow, and possibly short-term, purposes.
Management welcomes shareholder input on governance—The Company has strong corporate
governance standards and practices that demonstrate the Board’s accountability to, alignment with, and
responsiveness to its shareholders. For example:
•Annual election of directors. All directors are elected annually and we do not have a classified
Board.
•Majority voting. The Company’s Articles of Incorporation provide a majority voting standard for
election of directors in uncontested elections and resignation by any incumbent director who is not
re-elected.
•Presiding Director. The Board has established the position of Presiding Director, which is held by an
independent director at all times. The Presiding Director presides at executive sessions of
non-management directors and at Board meetings at which the Chairman is not present, approves
Board meeting agendas and materials sent to the Board, is authorized to call meetings of
non-management directors, and facilitates communication between the Chairman and CEO and the
non-management directors.
•Stock ownership guidelines and stock-based compensation. More than one-half of the Board’s
Proxy Statement
compensation is comprised of stock-based compensation, and directors pledge that, for as long as
they serve, they will retain all shares of the Company’s common stock received pursuant to their
service as a Board member for at least one year following their departure from the Board.
•Communication with the Board. Shareholders may communicate with our Board of Directors,
individually or as a group, by contacting the Company’s corporate secretary.
In addition, our senior executives engage our shareholders periodically. We meet throughout the year
with shareholders and organizations interested in our practices.
FOR THESE REASONS, WE RECOMMEND THAT YOU VOTE AGAINST THIS PROPOSAL.
What vote is required to approve this proposal?
Approval of this requires the affirmative vote of a majority of the shares present in person or
represented by proxy and entitled to vote at the Annual Meeting.
24