Krystal sweetens website with eye candy; the King better head for cover; and nothing says holidays like 'Tamaledays'

Nation's Restaurant News,  Nov 19, 2007  by Gregg Cebrzynski

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Question: Do you still write those columns where you make up the questions and answer them because you don't have enough material on a single topic to flesh out a whole column?

Answer: Keep reading and you'll find out.

Q: Why haven't you informed the world that the Krystal sandwich chain has a Krystal Chik Calendar on its website? Are they trying to be like Hooters, or what?

A: I didn't know about the calendar until a week or so ago, when I was rummaging around various restaurant websites. And no, Krystal is far from imitating the Hooters Girls calendar. Little known fact: Catholics who look at the Hooters calendar during Lent are condemned to an eternity of fire and brimstone. Krystal's calendar, though sexy, is a relatively chaste effort, and it fits in with the chain's continued targeting of college students and young men and women.

Q: Is it true that a group of morns has put out a hit on Burger King's notorious King?

A: Yes it is, judging from a new TV spot for the Bacon Double Homestyle Melt. The "Hitmoms" are upset that the sandwich is better than they could make. They approach a tough-looking guy and hand him a couple photos of the King.

to calculate total compensation for the 60 companies' chief executives.

Their median base salary was $515,000, which accounted for 40 percent of the total CEO compensation. Long-term incentives in the form of stock and option awards comprised the second-largest component, representing 36 percent of the total, or an average of $470,161.

The median short-term incentives of nonequity rewards and bonuses were 22 percent of total compensation on average, or $286,500.

The report also divided companies into three groupings by market capitalization as of Oct. 4 to examine salary differences according to the size of restaurant chains. Based on shares outstanding, companies were grouped by aggregate stock values less than $250 million, between $250 million and $1 billion, and greater than $1 billion.

Base pay was a greater percentage of total compensation for chief executives of smaller companies, but as companies increased in market cap size, so did the percentage of long-term incentives as a part of total compensation.

Among the smaller companies, base salary was 55 percent of a chief executive's total compensation, with an almost even split then between short- and long-term incentives.

For the midsize companies, all three components were almost evenly split.

But in larger companies, base salary was only a quarter of total compensation; long-term incentives were 41 percent of the total compensation while short-term incentives were 26 percent.

"You want these individuals thinking short-term and long-term," Mansbach said. "It's harder to be objective on a longer-term strategy. if [long-term] incentives are not tied to your compensation program."

Compensation committees are trying to be more strategic about how chief executives are paid, he said.

"Companies are really getting that compensation and pay-for-performance is really on [shareholders'] radar, and it's also the right thing to do to be successful," Mansbach said. Pay-for-performance programs have been increasing in public companies across all industries, said Shirley Westcott, managing director of Proxy Governance, the Vienna, Va., shareholder advisory firm that had been critical of Fertitta's pay at Landry's.

"We've been seeing in recent years more of a shift from plain-vanilla stock options to full-value shares and restricted shares," Westcott said. "CEOs are being awarded for time on the job and for meeting certain performance hurdles for those shares to actually vest."

Despite efforts to make CEO pay methods transparent, shareholders are asking for even greater disclosure, she said.

"Many investors would like companies to disclose the numerical performance hurdles for CEOs, but they are not required to do so," Westcott said. "The SEC still finds the discussion is not clear enough to know how the pay packages are being designed to ensure they are sufficiently tied to performance."

She forecast that regulators and companies would confront proposals to require "more performance-based awards, better benchmarking in determining incentive pay, and pay for superior performance."

One proxy proposal the SEC may be asked to consider is "say on pay," a rule that would give shareholders an advisory vote on CEO compensation, Westcott added.

In April, the U.S. House of Representatives approved a bill that would require publicly owned foodservice and other companies to submit executive pay packages to nonbinding votes of shareholders.

The say-on-pay measure, which passed by a 269-134 House vote, would require that shareholders' yeas and nays on the compensation of "principal executive officers" be solicited via proxy materials distributed for annual meetings taking place after Jan. 1, 2009. Such votes would not supersede corporate boards' pay decisions but would express the sentiments of stockholders, proponents of the law said.