Progress Energy 2009 Annual Report Download - page 161

Progress Energy Proxy Statement
23
 2XUFRPSHQVDWLRQSURJUDPLVHYDOXDWHGDQQXDOO\IRULWVHIIHFWLYHQHVVDQGFRQVLVWHQF\ZLWKWKH
Company’s goals without promoting excessive risk.
 2XUFRPSHQVDWLRQSURJUDPDSSURSULDWHO\EDODQFHVVKRUWDQGORQJWHUPLQFHQWLYHVZLWKDSSUR[LPDWHO\
60% of total target compensation for the executive officers provided in equity and focused on long-
term performance.
 7KH3663UHZDUGVVLJQLILFDQWDQGVXVWDLQDEOHSHUIRUPDQFHRYHUWKHORQJHUWHUPE\IRFXVLQJRQWKUHH
year earnings per share growth and relative total shareholder return targets.
 7KH0,&3LQHIIHFWIRUVSHFLILFDOO\IRFXVHVRQHDUQLQJVEHIRUHLQWHUHVWWD[HVGHSUHFLDWLRQDQG
amortization (“EBITDA”), and the MICP that is in effect for 2010 specifically focuses on legal entity
net income, because we believe that these are appropriate measures to assess the intrinsic value of the
Company to determine whether the Company has been successful in its fundamental business.
 2XUFRPSHQVDWLRQSURJUDPVDUHGHVLJQHGWRPDNHLWGLIILFXOWIRUDQ\RQHSHUVRQWRPHDQLQJIXOO\
influence his or her own incentive award.
 7KHH[HFXWLYHRIILFHUVUHFHLYHUHVWULFWHGVWRFNXQLWVWKDWJHQHUDOO\KDYHDWKUHH\HDUYHVWLQJSHULRGVR
that their upside potential and downside risk are aligned with that of our shareholders and promote
long-term performance over the vesting period.
 7KHH[HFXWLYHRIILFHUVDUHVXEMHFWWRVWRFNRZQHUVKLSJXLGHOLQHVLQGHSHQGHQWO\VHWE\WKH%RDUGWR
reflect the compensation program’s goals of risk assumption and sharing between executives and
shareholders.
We have determined that the compensation program for non-executive officers who are in senior
management positions does not encourage excessive risk taking for all the reasons stated above.