Pizza Hut 2012 Annual Report Download - page 77

YUM! BRANDS, INC.-2013Proxy Statement 59
Proxy Statement
EQUITY COMPENSATION PLAN INFORMATION
Planning and Development Committee (Mr.Walter in 2012) receives
an additional $15,000 stock retainer annually.
Initial Stock Grant upon Joining Board. Non-employee directors
also receive a one-time stock grant with a fair market value of
$25,000 on the date of grant upon joining the Board, distribution
of which is deferred until termination from the Board.
Stock Ownership Requirements. Similar to executive offi cers,
directors are subject to share ownership requirements. The
directors’ requirements provide that directors will not sell any of
the Company’s common stock received as compensation for
service on the Board until the director has ceased being a member
of the Board for one year (sales are permitted to cover income
taxes attributable to any stock retainer payment or exercise of a
stock option or SAR).
Matching Gifts. To further YUM’s support for charities, non-employee
directors are able to participate in the YUM!Brands,Inc. Matching
Gifts Program on the same terms as YUM’s employees. Under this
program, the YUM!Brands Foundation will match up to $10,000
a year in contributions by the director to a charitable institution
approved by the YUM!Brands Foundation. At its discretion, the
Foundation may match director contributions exceeding $10,000.
For Mr.Holland, in recognition of his long term service on the
Board, the Company made an additional matching contribution
that exceeded $10,000.
Insurance. We also pay the premiums on directors’ and offi cers’
liability and business travel accident insurance policies. The annual
cost of this coverage was approximately $2 million. This is not
included in the tables above as it is not considered compensation
to the directors.
EQUITY COMPENSATION PLAN INFORMATION
The following table summarizes, as of December31,2012, the equity compensation plans under which we may issue shares of stock
to our directors, offi cers and employees under the 1999 Long Term Incentive Plan (“1999 Plan”), the 1997 Long Term Incentive Plan
(the “1997 Plan”), SharePower Plan and Restaurant General Manager Stock Option Plan (“RGM Plan”).
Plan Category
Number of
Securities To
be Issued Upon
Exercise of
Outstanding
Options, Warrants
and Rights
Weighted-
Average
Exercise Price
of Outstanding
Options, Warrants
and Rights
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans (Excluding
Securities Refl ected in
Column(a))
(a) (b) (c)
Equity compensation plans approved by security holders 19,484,207(1) 37.03(2) 10,417,997(3)
Equity compensation plans not approved by securityholders(4) 628,915 37.94(2) 7,609,509
TOTAL 20,113,122(1) 37.07(2) 18,027,506(3)
(1) Includes 5,516,637shares issuable in respect of RSUs, performance units and deferred units.
(2) Weighted average exercise price of outstanding options and SARs only.
(3) Includes 5,208,998 shares available for issuance of awards of stock units, restricted stock, restricted stock units and performance share unit awards under the 1999 Plan.
(4) Awards are made under the RGM Plan.
What are the key features of the 1999 Plan?
The 1999 Plan provides for the issuance of up to 70,600,000shares
of stock as non-qualifi ed stock options, incentive stock options,
SARs, restricted stock, restricted stock units, performance shares
or performance units. Only our employees and directors are
eligible to receive awards under the 1999 Plan. The purpose of
the 1999 Plan is to motivate participants to achieve long range
goals, attract and retain eligible employees, provide incentives
competitive with other similar companies and align the interest
of employees and directors with those of our shareholders. The
1999 Plan is administered by the Management Planning and
Development Committee of the Board of Directors. The exercise
price of a stock option grant or SAR under the 1999 Plan may not
be less than the average market price of our stock on the date
of grant for years prior to 2008 or the closing price of our stock
on the date of the grant beginning in 2008, and no options or
SARs may have a term of more than ten years. The options and
SARs that are currently outstanding under the 1999 Plan generally
vest over a one to four year period and expire ten years from the
date of the grant. Our shareholders approved the 1999 Plan in
May1999, and the plan as amended in 2003 and again in 2008.