How has the executive incentive plan changed?

The amended plan shifts the basis for awards from a percentage of net income to a percentage of "Incentive Income," which is defined as consolidated net income adjusted for specific items like taxes, extraordinary items, merger costs, and obligations related to BlackRock's long-term incentive programs. Eligibility has also been broadened, now relying on the Compensation Committee's discretion rather than solely on being a "covered employee" under Section 162(m) of the Internal Revenue Code.

Were there any changes to director compensation?

No, the Nominating and Governance Committee conducted its annual review of non-employee director compensation and decided to make no changes to the existing annual retainer and meeting fee schedules. However, all non-employee directors received a grant of 1,232 deferred stock units as part of their equity compensation for 2007.

Why did J. Gary Cooper retire?

J. Gary Cooper retired as a director because he reached the age of 70. PNC's Corporate Governance Guidelines state that individuals age 70 or older will not be nominated for re-election as a director.

PNC 8-K: Leadership Changes

Q: What is the main purpose of the 8-K filing?

The primary purpose of this 8-K filing is to report the shareholder approval of the amended and restated 1996 Executive Incentive Award Plan, along with the retirement of a director and the annual review of director compensation.

Summary

PNC Financial Services Group, Inc. (PNC) filed an 8-K on April 30, 2007, detailing key events from April 23, 2007. The most significant update for investors is the shareholder approval of the amended and restated 1996 Executive Incentive Award Plan. This plan, effective January 1, 2007, outlines new criteria for executive compensation, shifting from a focus on "covered employees" under IRC Section 162(m) to a broader Committee selection process. Compensation will now be based on a percentage of "Incentive Income" rather than a portion of net income, with specific adjustments for various financial items. Additionally, the report notes the retirement of director J. Gary Cooper due to age restrictions and confirms no changes to non-employee director compensation. The Nominating and Governance Committee conducted its annual review, referencing peer group data, and decided to maintain existing retainer and meeting fee structures. Non-employee directors also received a grant of 1,232 deferred stock units as part of their 2007 equity compensation.

Key Highlights

1Shareholder approval obtained for the amended and restated 1996 Executive Incentive Award Plan, effective January 1, 2007.
2The executive incentive plan now uses "Incentive Income" (based on consolidated net income with specific adjustments) as the performance metric, replacing a percentage of net income.
3Eligibility for the executive incentive plan has broadened beyond "covered employees" under IRC Section 162(m) to include individuals selected by the Compensation Committee.
4Director J. Gary Cooper retired from the Board of Directors due to the company's policy of not nominating directors aged 70 or older.
5No changes were made to the annual retainer and meeting fee schedules for non-employee directors following an annual review by the Nominating and Governance Committee.
6Each non-employee director received a grant of 1,232 deferred stock units as part of their 2007 equity compensation.

PNC FINANCIAL SERVICES GROUP, INC. 8-K Report, Executive Changes (Apr 30, 2007)

Summary

Key Highlights

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