Exhibit 10.3
ASBURY AUTOMOTIVE GROUP,
INC.
KEY EXECUTIVE INCENTIVE
COMPENSATION PLAN
(Effective January 1, 2004
Amended and Restated as of November 21, 2008)
SECTION 1. Purpose. The
purpose of the Asbury Automotive Group, Inc. Key Executive
Incentive Compensation Plan (the “ Plan ”) is to
attract, retain and motivate highly qualified individuals who are
key executives of Asbury Automotive Group, Inc. (the “
Company ”), and its subsidiaries and affiliates
(together with the Company and their and its successors, “
Asbury ”); to obtain the best possible performance
from each Participant; to further underscore the importance of
achieving particular business objectives established for Asbury;
and to include in Participants’ compensation package a bonus
component that is tied directly to the achievement of those
objectives. Such bonus component is intended to qualify as
performance-based compensation under Section 162(m) of the
Internal Revenue Code of 1986, as amended from time to time (the
“ Code ”), and the Plan shall be interpreted
accordingly.
SECTION 2. Definitions. For
the purposes of the Plan, the following terms shall have the
following meanings:
“ Asbury ” shall
have the meaning set forth in Section 1.
“ Awards ” shall
mean the incentive awards made pursuant to the Plan.
“ Board of Directors
” shall mean the Board of Directors of the
Company.
“ Code ” shall
have the meaning set forth in Section 1.
“ Committee ”
shall mean the Compensation Committee of the Board of
Directors.
“ Company ” shall
have the meaning set forth in Section 1.
“ Covered Person
” shall have the meaning set forth in
Section 12(f).
“ Eligible Employee
” shall mean an Employee who is an executive officer of
Asbury, as determined by the Committee.
“ Employee ”
shall mean an individual who is on the active payroll of Asbury at
any time during the period for which an Award is made under the
Plan.
“ Establishment Period
” shall have the meaning set forth in
Section 5.
“ Participant ”
shall mean an Eligible Employee who is selected by the Committee to
participate in the Plan.
“ Performance Period
” shall mean a full fiscal year of the Company unless, to the
extent consistent with Section 162(m) of the Code, otherwise
determined by the Committee.
“ Plan ” shall
have the meaning set forth in Section 1.
“Section 409A” shall
mean Section 409A of the Code and the Department of Treasury
regulations and other interpretive guidance issued
thereunder.
Effective Date; Term. The Plan became effective as of January 1,
2004, and was approved by the Company’s stockholders at the
Company’s 2004 Annual Meeting of Stockholders on June 3,
2004, and, subject to Section 9, shall remain in effect until
such time as it shall be terminated by the Board of Directors. The
Plan supersedes all previous bonus plans. The Plan is hereby
amended and restated to include the revised requirements of
Section 409A of the Code, which amendment and restatement was
approved by the Committee on November 21, 2008.
SECTION 3.
SECTION 4. Maximum Awards.
Awards payable with respect to any fiscal year of the Company to
any Participant shall not exceed $5,000,000.
SECTION 5. Eligibility.
(a) Within the first 90 days of the applicable Performance
Period (or, if shorter, within the maximum period allowed under
Section 162(m) of the Code) (the “ Establishment
Period ”), the Committee shall select those Eligible
Employees who shall participate in the Plan for such Performance
Period. In determining those Eligible Employees who are selected to
participate in the Plan, the Committee shall give consideration to
the contribution made by the Employee to the achievement of
Asbury’s established objectives and such other matters as it
shall deem relevant. The Committee shall have the authority at any
time prior to the payment of Awards for the applicable Performance
Period to remove Participants from the Plan for that Performance
Period.
(b) To be eligible to receive an
Award, the Eligible Employee must be employed on the date Asbury
makes payments with respect to Awards for the applicable
Performance Period. Notwithstanding the foregoing, in the
discretion of the Committee, Awards may be made to Eligible
Employees who have retired or whose employment has terminated after
the beginning of the Performance Period for which an Award is made,
or to the designee or estate of an Eligible Employee who died prior
to the date on which Asbury makes payments with respect to Awards
for the applicable Performance Period, but not unless and until the
Committee has certified attainment of the relevant performance
goals in accordance with Section 7(b).
SECTION 6. Awards.
(a) Subject to the terms of the Plan, the Committee shall have
the authority to determine the terms of any Award.
(b) Within the Establishment Period,
the Committee shall establish in writing (i) the length of the
Performance Period, (ii) the Eligible Employees who shall
participate in the applicable Performance Period, (iii) the
target/maximum Award payable to each Participant and (iv) the
performance goal(s) for Awards granted for that Performance Period.
The performance goal(s) that may be selected by the Committee shall
be based upon one or more of the following criteria: (A) net
income before or after taxes, (B) earnings before or after
taxes (including earnings before interest, taxes, depreciation and
amortization), (C) operating income, (D) earnings per
share, (E) return on stockholders’ equity,
(F) return on investment, (G) return on assets,
(H) level or amount of acquisitions, (I) share price,
(J) profitability/profit margins, (K) market share,
(L) revenues or sales (based on units and/or dollars),
(M) costs, (N) cash flow, (O) working capital,
(P) objective measures of customer satisfaction and
(Q) objective measures of objective measures of employee
satisfaction. The foregoing criteria may, as determined by the
Committee, relate to the Company, one or more of its subsidiaries,
affiliates, divisions or operational units, or any combination of
the foregoing, and may be applied on an absolute basis and/or be
relative to one or more peer companies or indices or any
combination thereof. To the extent required under
Section 162(m) of the Code, within the Establishment Period,
the Committee shall define, in writing and in an objective fashion,
the manner of calculating the performance criteria it selects to
use for the applicable Performance Period in order to determine
whether the applicable performance goal(s) have been
attained.
(c) The Committee is authorized at
any time during the Establishment Period, or any time
thereafter
