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This excerpt taken from the BPOP DEF 14A filed Mar 13, 2009. Base
Salary
Base salaries are generally designed to be competitive with
comparable positions in peer group companies in order to attract
and retain executives. Base salaries vary based on the
Compensation Committee’s assessment of the NEO’s
qualifications, experience, responsibilities, leadership
potential, individual goals, performance and competitive pay
practices. Base salaries are reviewed annually, but are not
necessarily increased.
In January 2008, the Compensation Committee reviewed NEO base
salaries and increased the base salaries of NEOs, other than the
CEO, as shown in the table below. The CEO’s base salary was
not increased. The Compensation Committee determined that such
increases were warranted in order to remain competitive and
recognize the evolution of the leadership roles in recent years.
While market survey data showed that since 2005 top executive
base pay increased an average of approximately 5% annually, the
Corporation’s NEOs remained at reduced salary levels as a
result of a base salary reduction that they accepted in 2006
which remained unchanged in 2007. The 2008 base pay adjustments
granted by the Compensation Committee to the NEOs, other than
the CEO, sought to restore the reductions that had been in
effect since January 2006.
In the case of Mr. Jordán and Ms. Santos de
Álvarez, the Compensation Committee incorporated a base pay
adjustment to maintain base pay competitiveness with comparable
positions at the Corporation’s peer institutions. In
approving the base pay increases, the Committee also took into
consideration the evolution of their roles during the past five
years in terms of increasing responsibility, complexity and
regulatory impact. Mr. Villamil’s base pay adjustment
recognized the increase in size, scope and profitability of
EVERTEC since its inception in 2004. Mr. Negrón
assumed his current position effective April 1, 2008 and
his compensation was set as described below.
As an important part of the actions taken in February 2009 to
generate cost savings due to the deteriorating economic crisis
and the Corporation’s financial results, the Compensation
Committee approved a 10% reduction in base salary for Mr. Chafey
(Chief Operating Officer) and a 7.5% reduction in base salary
for the other NEOs, effective March 2009. A base salary
reduction of 10% for Mr. Carrión has been in effect since
2005. Base pay reductions were also implemented for 73 other
executives of the Corporation.
The following table illustrates these changes:
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