Harris Teeter 2011 Annual Report Download - page 93

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Deductibility of Compensation Expenses
Section 162(m) of the Internal Revenue Code of 1986 (the “Code”) generally limits the tax deductibility by
the Company for compensation paid to the Chief Executive Officer and the other most highly compensated executive
officers to $1 million per officer per year, unless it qualifies as “performance-based” compensation. To qualify as
“performance-based,” compensation payments must satisfy certain conditions, including limitations on the
discretion of the Compensation Committee in determining the amounts of such compensation. It is the Company’s
current policy that, to the extent possible, compensation paid to its executive officers be deductible under Section
162(m) of the Code. In furtherance of this policy, the Board of Directors has adopted, and the shareholders have
approved, the Cash Incentive Plan, the Addendum, and the 2011 Plan. The Cash Incentive Plan, the Addendum
and the 2011 Plan have each been structured in a manner such that cash incentive payments and performance-based
equity awards under each plan can satisfy the requirements for “performance-based” compensation within the
meaning of Section 162(m) of the Code.
Summary Compensation Table for 2011
Name and
Principal Position Year
Salary
($)
Bonus
($)
Stock
Awards
($)(1)
Option
Awards
($)
Non-Equity
Incentive Plan
Compensation
($)(2)
Change in
Pension Value
and
Non-Qualified
Deferred
Compensation
Earnings
($)(3)
All Other
Compensation
($)(4)
Total
($)
Thomas W. Dickson ....... 2011 682,000 — 1,345,400 — 865,867 306,000 171,958 3,371,225
Chairman of the Board,
President and Chief Executive
Officer of the Company
2010 620,000 — 667,062 — 662,160 1,804,000 139,686 3,892,908
2009 620,000 — 663,376 — 502,944 2,565,000 140,288 4,491,608
John B. Woodlief ......... 2011 472,500 — 576,600 — 499,905 272,000 142,592 1,963,597
Vice President—Finance and
Chief Financial Officer
of the Company
2010 435,000 — 333,532 — 387,150 728,000 139,766 2,023,448
2009 435,000 — 331,688 — 294,060 929,000 134,434 2,124,182
Frederick J. Morganthall, II . . 2011 482,000 — 672,700 — 367,525 286,000 135,867 1,944,092
President of
Harris Teeter, Inc.
2010 452,500 — 333,532 — 341,638 1,245,000 118,290 2,490,960
2009 452,500 — 331,688 — 359,738 1,785,000 114,313 3,043,239
Fred A. Jackson .......... 2011 328,000 — 345,960 — 235,627 363,000 112,025 1,384,612
President of
American & Efird (5)
2010 295,000 29,500 (6) 240,142 — 162,361 262,000 103,125 1,092,128
2009 295,000 — 238,816 — — 616,000 106,275 1,256,091
(1) Amounts reflect the grant date fair value computed in accordance with Financial Accounting Standards Board
Accounting Standards Codification (“FASB ASC”) Topic 718, related to restricted stock and performance
shares granted in the fiscal year noted. The assumptions used in the calculation of these amounts are included
in the note entitled “Stock Options and Stock Awards” in the Notes to Consolidated Financial Statements
included within the Company’s Annual Report on Form 10-K for the fiscal year ended October 2, 2011, except
that for the purposes of this table the estimates of forfeitures related to service-based vesting conditions have
been disregarded. For more information on the actual forfeitures, if any, for each of the NEOs listed in the
table during Fiscal 2011, please refer to “2011 Performance Share Awards”. For more information on the
outstanding shares of restricted stock held by the NEOs, please refer to “Outstanding Equity Awards at Fiscal
Year-End for 2011”.
(2) This column represents Incentive Bonuses paid to the NEOs. In accordance with the Securities and Exchange
Commission requirements, Incentive Bonuses paid are “performance-based” and therefore are reported in the
Non-Equity Incentive Plan Compensation column. As described in the “Compensation Discussion and
Analysis” section, such cash incentive bonuses are paid to the NEOs when specific performance measures are
achieved and the payment is approved by the Compensation Committee. These amounts were paid in November
2011 with respect to the Company’s performance in Fiscal 2011.
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