Pizza Hut 2010 Annual Report Download - page 65

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allocation of $336,700, which is set forth under the ‘‘All Other Compensation’’ column in the Summary
Compensation Table at page 52.
Medical, Dental, Life Insurance and Disability Coverage
We also provide other benefits such as medical, dental, life insurance and disability coverage to each
NEO through benefits plans, which are also provided to all eligible U.S.-based salaried employees. Eligible
employees, including the NEOs, can purchase additional life, dependent life and accidental death and
dismemberment coverage as part of their employee benefits package. Except for the imputed value of life
insurance premiums, the value of these benefits is not included in the Summary Compensation Table since
they are made available on a Company-wide basis to all U.S. based salaried employees. In 2010, our broad
based employee disability plan was changed to limit the annual benefit coverage to $300,000. For
employees whose coverage was reduced as a result of the change, the Company is purchasing individual
disability coverage for three years (provided employment continues) to make up for the lost coverage
resulting from the cap placed on the broad based employee plan. This coverage is provided to each NEO
and the incremental cost of the additional coverage is included in the ‘‘All Other Compensation’’ table at
footnote 3 at page 54.
Perquisites
We provide perquisites to our executives as described below. The value of these perquisites is included
in the Summary Compensation Table in the column headed ‘‘All Other Compensation’’, and the perquisites
are described in greater detail in the All Other Compensation Table. Perquisites have been provided since
the Company’s inception. Some perquisites are provided to ensure the safety of the executive. In the case
of foreign assignment, tax equalization is provided to equalize different tax rates between the executive’s
home country and work country.
For NEOs other than the CEO, in 2010 we paid for a country club membership and provide up to a
$7,500 perquisite allowance annually. If the executive did not elect a country club membership, the
perquisite allowance is increased to $11,500 annually. We also provide an annual car allowance of $27,500
and an annual physical examination.
Proxy Statement
Our CEO does not receive these perquisites or allowances. However, Mr. Novak is required to use the
Company aircraft for personal as well as business travel pursuant to the Company’s executive security
program established by the Board of Directors. The Board’s security program also covers Mrs. Novak. In
this regard, the Board of Directors noted that from time to time, Mr. Novak has been physically assaulted
while traveling and he and his family have received letters and calls at his home from people around the
globe with various special interests, establishing both an invasion of privacy and implicit or explicit threats.
The Board has considered this enough of a concern to require security for Mr. Novak, including the use of
the corporate aircraft for personal travel. Other executives may use corporate aircraft for personal use with
the prior approval of Mr. Novak. In addition, depending on seat availability, family members of executive
officers may travel on the Company aircraft to accompany executives who are traveling on business. There
is no incremental cost to the Company for these trips. The incremental cost of the personal use by
Mr. Novak is reported on page 54. We do not gross up for taxes on the personal use of the company
aircraft. We also pay for the cost of the transmission of home security information from Mr. Novak’s home
to our security department and that incremental cost is reflected in the ‘‘Other’’ column of the All Other
Compensation Table.
For 2011, the Committee eliminated the following perquisites for all executive officers (including the
NEOs): car allowance, country club membership, perquisite allowance and annual physical. In recognition
of this change, NEOs (other than our CEO who did not receive these perquisites and Mr. Su whose
perquisites are described below) received a one time $25,000 increase to their salary during 2011.
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