Before
Pay for performance is a key component of the Company’s executive compensation philosophy. The Company’s executive compensation program has been structured to link a significant portion of the compensation of the named executive officers with the Company’s performance. While the program includes a base salary designed to attract, retain and motivate named executive officers, it also places a substantial amount of total executive compensation, including compensation of the CEO, “at risk” based on the performance of the Company and the executive through annual and long-term cash incentive and equity-based compensation awards. As discussed below, annual and long-term cash incentive awards are performance-based awards and represent “at risk” compensation because minimum levels of performance must be attained in order for any payout to occur. Similarly, because stock option awards only have value if the stock price increases, these awards are performance-based and “at risk.”
Our pay-for-performance compensation program aligns the compensation of the CEO with the interests of the Company’s shareholders, with a substantial amount of the CEO’s target total direct compensation being “at risk” performance-based compensation. For fiscal 2012, target “at-risk” performance-based compensation represented approximately 73% of our CEO’s target total direct compensation.
The Company’s financial results for fiscal 2011 improved significantly over fiscal 2010, resulting in an annual cash incentive being paid to our CEO for the first year since fiscal 2007. The Company’s compensation decisions for fiscal 2008 through fiscal 2011 demonstrate that a significant portion of the CEO’s compensation is directly tied to the financial performance of the Company, thus serving the long-term interests of the Company’s shareholders.
[261 words]
Before, with commentary
Pay for performance is a key component of the Company’s executive compensation philosophy. The Company’s executive compensation program has been structured to link a significant portion of the compensation of the named executive officers with the Company’s performance. While the program includes a base salary designed to attract, retain and motivate named executive officers, it also places a substantial amount of total executive compensation, including compensation of the CEO [why does this get a special mention?], “at risk” based on the performance of the Company and the executive through annual and long-term cash incentive and equity-based compensation awards. As discussed below, annual and long-term cash incentive awards are performance-based awards and represent “at risk” compensation because minimum levels of performance must be attained in order for any payout to occur. Similarly, because stock option awards only have value if the stock price increases, these awards are performance-based and “at risk.”
Our pay-for-performance compensation program aligns the compensation of the CEO with the interests of the Company’s shareholders, with a substantial amount of the CEO’s target total direct compensation being “at risk” performance-based compensation. For fiscal 2012, target “at-risk” performance-based compensation represented approximately 73% of our CEO’s target total direct compensation.
The Company’s financial results for fiscal 2011 improved significantly over fiscal 2010, resulting in an annual cash incentive being paid to our CEO for the first year since fiscal 2007. The Company’s compensation decisions for fiscal 2008 through fiscal 2011 demonstrate that a significant portion of the CEO’s compensation is directly tied to the financial performance of the Company, thus serving the long-term interests of the Company’s shareholders.
[I count nine references to pay-for-performance, at-risk pay, or performance-based compensation in three paragraphs. I’m not sure when you hit overkill, but it’s somewhere shy of nine.]
After
The Company’s executive compensation program has been structured to link a significant portion of the compensation of the named executive officers with the Company’s performance. While we pay a base salary designed to attract, retain, and motivate named executive officers, a substantial amount of total executive compensation, in the form of annual and long-term cash incentive and equity-based compensation awards, varies based on the performance of the Company and the executive. As discussed below, the Company does not make any payment on annual and long-term cash incentive awards unless we attain minimum levels of performance. Similarly, stock option awards only have value if the Company’s stock price increases.
Consistent with our commitment to a pay-for-performance philosophy that aligns the compensation of the CEO with the interests of the Company’s shareholders, for fiscal 2012, approximately 73% of our CEO’s target total direct compensation consisted of at-risk performance-based awards. Notably, our CEO received an annual cash incentive in fiscal 2012 for the first time since fiscal 2007. The Company’s financial results were disappointing for a few years, but improved significantly in fiscal 2011.
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