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This excerpt taken from the PNRA DEF 14A filed Apr 13, 2006. Components
of Compensation
There are two primary components to the compensation of our
executive officers: annual cash compensation (consisting of
salary and bonus incentives) and long-term incentive
compensation.
Annual Cash Compensation. Each executive
officer’s compensation consists of a base salary and a
bonus. The individual’s base salary is designed to be
competitive with companies of a similar size in our industry
while taking into account the strengths and talents of the
individual officer. In fiscal 2005, the executive officers other
than Mr. Shaich received an average salary increase of 16%.
An officer’s bonus is based on his or her performance
against individual goals, operating group performance and other
subjective criteria as well as overall Company performance with
a target bonus generally in the range of 30% to 50% of the
individual’s base salary with a potential bonus opportunity
of twice the amount of the targeted percentage. For fiscal 2005,
the executive officers in office at year-end other than
Mr. Shaich had an average target bonus of 37% of base
salary and received an average cash bonus of 117% of that target
bonus.
Thus, our cash compensation practices seek to motivate
executives by requiring excellent performance measured against
both internal goals and competitive performance.
Long-Term Incentive Compensation. The second
element of executive compensation is long-term incentive
compensation, which was awarded for fiscal year 2005 under the
2005 LTIP. Currently, the Chief Executive Officer recommends,
and the Compensation Committee grants, awards under the 2005
LTIP. The awards under the 2005 LTIP depend on the
executive’s position and performance as well as his or her
overall compensation package compared to companies of a similar
size in our industry. In fiscal 2005, the executive officers
other than Mr. Shaich received an average award under the
2005 LTIP comprised of restricted stock awards for
1,945 shares, stock option awards to purchase
8,291 shares and performance target awards of $140,000.
Other Compensation. The Compensation Committee
also considers the value of the annual compensation for each of
the Company’s executive officers and all executive officers
as a group. Generally, this compensation consists of matching
contributions to the Company’s 401(k) plan, life insurance
premiums, relocation reimbursements, chartered air travel and
other forms of compensation. For the Company’s named
executive officers, these items are summarized in the summary
compensation table and the notes to that table. The actual value
realized for these other forms of compensation may differ
materially from the amounts set forth in the table. Our
executive officers are also entitled to participate in our
employee stock purchase plan and other benefit plans.
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