The Compensation Committee believes that executive compensation should be closely aligned with our strategy and performance on both a short- and long-term basis to drive apay-for-performance culture and ensure that the interests of executive officers continue to be properly aligned with long-term shareholder interests and shareholder returns. In addition, a compensation program should be designed to assist us in attracting and retaining qualified management personnel who are critical to our long-term success in today’s highly competitive market.
To that end, the Compensation Committee’s philosophy is that executive compensation should be comprised of three principal components:
| • | performance-based annual cash incentive pay, which is dependent on our annual financial performance and the executives’ individual performance and impact; and |
| • | long-term incentive compensation in the form of stock options, RSUs, PSUs, or other equity-based awards that are designed to align executive officers’ interests with those of shareholders by rewarding outstanding performance and long-term value creation. |
The Compensation Committee considers a variety of factors when making compensation decisions and establishing the total compensation that it targets and pays for executive officers each year. Among these factors are:
| • | overall corporate performance; |
| • | individual performance and contribution of the executive to the overall corporate performance, primarily based on the input of the Chief Executive Officer; |
| • | equity based compensation awarded in prior years; |
| • | appropriate blend of short-term and long-term compensation and of cash and equity compensation; |
| • | competitive factors in the market, including total compensation paid to our executive officers compared to amounts paid to executives in similar positions at similarly-sized companies and relative to peers, both for the prior year and over a multi-year period; |
| • | broad trends in executive compensation within the restaurant industry; |
| • | recommendations of the independent compensation consultant retained by the Compensation Committee; and |
| • | the recommendations of our Chief Executive Officer (for Named Executive Officers and executives other than himself). |
Compensation Discussion and Analysis• Alignment with Shareholder Interests
