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DEF 14A
PENSKE AUTOMOTIVE GROUP, INC. filed this Form DEF 14A on 03/16/2017
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In February 2017, the committee established a similar performance based award for Mr. Penske with respect to 2017, with a threshold payout of $2.5 million (50% of target), a target payout of $5.0 million (100% of target) and a maximum potential payout of $7.5 million (150% of target) to be paid in shares of restricted stock to be granted in 2018 calculated by dividing the resulting total award achieved by the average PAG stock price for each trading day in 2017. The performance objectives for 2017 are as follows:

•    Objective



% of Award

 

 

 

 

 

EBITDA (earnings before interest, taxes, depreciation and amortization) of $735 million (100% attainment). EBITDA below $683 million results in no attainment, EBITDA of $683 million results in 50% attainment, and EBITDA of $770 million yields 200% attainment.(1)(2)

  20 %

Compliance with the covenants in our U.S. and U.K. credit facilities

    10 %

Earnings per share of $4.28 to $4.35 (100% attainment). EPS of $3.93 to $4.27 (50% attainment) and EPS over $4.35 (200% attainment)(1)

  10 %

Operating margin of 3.0% to 3.19% (100% attainment), operating margin of 2.9% to 2.99% (50% attainment) and above 3.2% (150% attainment)(1)(3)

    10 %

Common stock price performance exceeds the S&P 500 Index during 2017 (100% attainment). Performance below the S&P 500 results in no attainment and outperformance by 7.5% to 15% yields 125% attainment and outperformance by more than 15% or more yields 150% attainment

  10 %

Customer satisfaction scores exceed manufacturer objectives at 90% of our U.S. franchises

    10 %

No material weaknesses in our internal controls

  10 %

Reduce selling, general and administrative expense as a percentage of gross profit by more than 100 basis points (100% attainment). Reduction below 10 basis points results in no attainment, reduction of 10 to 50 basis points results in 25% attainment, reduction of 51 to 75 results in 50% attainment and reduction of 76 to 100 results in 75% attainment

    10 %

Same-store revenue growth of 5% (100% attainment). Growth below 5% results in no attainment, and growth of 10% yields 200% attainment.(2)

  10 %

Total

    100 %
(1)
This performance target excludes income or loss from discontinued operations, extraordinary items, changes in accounting principles, or any items of gain or loss relating to strategic or financial restructurings, the divestiture of assets or a business and, in each case, only if excluded from the definition of consolidated net income under the Company's U.S. credit agreement.

(2)
Performance between these amounts yields pro rata attainment.

(3)
Operating margin is the ratio of operating income to total revenue.

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