This excerpt taken from the PBI DEF 14A filed Mar 26, 2009.
Actions Taken by the Executive Compensation Committee in 2008
The Committee believes that the companys compensation program effectively achieves the objective of aligning compensation with performance measures that are directly related to the companys financial goals without encouraging executives to take unnecessary and excessive risks, and reviews the program on an annual basis to ensure the objective is met. The Committee strives to maintain a compensation program that is balanced to help us effectively motivate and retain our executives.
The Committee and management evaluated and reviewed the executive compensation mix, in particular the long-term incentive program, in the context of the companys performance and the economy. It was determined that the long-term incentive program, which in 2008 utilized two types of incentives for named executive officers, stock options and CIUs, would be modified for 2009 to include performance-based restricted stock units. The Committee felt that the addition of performance-based restricted stock units would achieve a better balance in the long-term incentive program while continuing to reflect the importance of the role of stock performance in executive compensation.
After consulting with Frederic W. Cook & Co., Inc., the Committee approved the design and performance metric for performance awards to be granted in 2008 to executive officers, including some of the named executive officers. The amounts of the performance awards were determined based on base salary. The awards are based on one-year performance criteria and include subsequent time-based vesting. In designing these awards, the Committee balanced the need for performance-based compensation with the need for a strong retention vehicle.
The Committee also reviewed the peer group it used to evaluate compensation practices for the named executive officers. Frederic W. Cook & Co., Inc. recommended the Committee revise the current peer group to remove companies that were, for a variety of reasons, no longer applicable and replace them with companies that more closely align to the companys size and lines of business. After reviewing a report prepared by the independent consultant, the Committee selected a new peer group comprised of 17 companies, of which 11 companies were in the previous peer group. Please see page 26 for a more detailed discussion of this process.
In addition to the actions above, the Committee approved the 2008 incentive plan objectives for annual incentives, performance awards, CIUs and the performance criteria as required under Section 162(m) of the Internal Revenue Code of 1986, as amended (the Code).
Following a continuing practice, the Committee reviewed tally sheets setting forth all components of compensation for the ten executive officers, including the chief executive officer, whose compensation is approved by the independent directors of the board. The Committee uses the tally sheets, which are discussed in detail on page 26, as an additional resource for determining whether any changes in compensation are appropriate.