Yum! 2010 Annual Report

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Bonnie G. Hill Bonnie G. Hill is President of B. Hill Enterprises LLC, a consulting Age 69 company. She has held this position since July 2001. She is also Director since 2003 co-founder of Icon Blue, Inc., a brand marketing company. She President, B. Hill Enterprises LLC served as President and Chief Executive Officer of Times Mirror Foundation, a charitable foundation affiliated with the Tribune Company from 1997 to 2001 and Senior Vice President, Communications and Public Affairs, of the Los Angeles Times from 1998 to 2001. From 1992 to 1996, she served as Dean of the McIntire School of Commerce at the University of Virginia. Ms. Hill currently serves as a director of AK Steel Holding Corporation, The Home Depot, Inc., and California Water Service Group. She serves as the Lead Director of the Board of Directors of The Home Depot, Inc. She serves on the boards of many other organizations, including the Financial Industry Regulatory Authority Investor Education Foundation. She also served on the boards of Hershey Foods Corporation from 1993 to 2007 and Albertson’s, Inc. from 2002 to 2006. Specific qualifications, experience, skills and expertise: Operating and management experience, including as president of a consulting firm and as dean of the school of commerce at a large public university Expertise in corporate governance, succession planning and public company compensation Public company directorship and committee experience Independent of Company Robert Holland, Jr. Robert Holland, Jr. is a Managing Director and Advisory Board Age 70 Member of Essex Lake Group, P.C., a strategy and management Director since 1997 consulting firm specializing in enhanced granular modeling and Managing Director and analytics, since 2009. From 2001 to 2009, he maintained a Advisory Board Member, consulting practice for strategic development assistance to senior Essex Lake Group, P.C. management of Fortune 500 companies. From 2005 to 2007, he was a member of Cordova, Smart and Williams, LLC an investment fund manager, and a limited partner of Williams Capital Partners Advisors, LP, a private equity investment firm. He was Chief Executive Officer of WorkPlace Integrators, Michigan’s largest steelcase office furniture dealer, from 1997 until 2001. From 1995 to 1996, he was President and Chief Executive Officer of Ben & Jerry’s Homemade, Inc. He was an associate and a partner at McKinsey & Co. from 1968 to 1981. Mr. Holland is also a director of Carver Federal Bank, Lexmark International, Inc. and Neptune Orient Lines Limited. Specific qualifications, experience, skills and expertise: Operating and management experience, including as a managing director of a consulting firm and chief executive officer of consumer, branded business Expertise in finance, strategic planning, marketing, business development and corporate governance Public company directorship and committee experience Independent of Company 17 Proxy Statement 9MAR201101
Proxy Statement 9MAR201101440694 Kenneth G. Langone Kenneth G. Langone is the founder, and since 1974, has been Age 75 Chairman of the Board, Chief Executive Officer and President, of Director since 1997 Invemed Associates, LLC, a New York Stock Exchange firm Founder, Chairman, Chief engaged in investment banking and brokerage. He is also a director Executive Officer and President, of Unifi, Inc. He is a founder of The Home Depot, Inc. and served Invemed Associates, LLC on its board from 1978 to 2008. Mr. Langone also served as a director of Choicepoint, Inc. from 2002 to 2008. Specific qualifications, experience, skills and expertise: Operating and management experience, including as chief executive officer of a highly regulated financial services business Expertise in finance, strategic planning, business development and retail business Public company directorship and committee experience Independent of Company Jonathan S. Linen Jonathan S. Linen has been an advisor to the Chairman of Age 67 American Express Company, a diversified worldwide travel and Director since 2005 financial services company, since January 2006. From August 1993 Advisor to the Chairman of until December 2005, he served as Vice Chairman of American American Express Company Express Company. From 1992 to 1993, Mr. Linen served as President and Chief Operating Officer of American Express Travel Related Services Company, Inc. From 1989 to 1992, Mr. Linen served as President and Chief Executive Officer of Shearson Lehman Brothers. Mr. Linen is a director of Modern Bank, N.A. and The Intercontinental Hotels Group. Specific qualifications, experience, skills and expertise: Operating and management experience, including as president and chief executive officer of a global travel-related services company Expertise in finance, marketing and international business development Public company directorship and committee experience Independent of Company Thomas C. Nelson Thomas C. Nelson has served as the President and Chief Executive Age 48 Officer of National Gypsum Company, a building products Director since 2006 manufacturer, since 1999 and was elected Chairman of the Board Chairman, Chief Executive Officer in January 2005. From 1995 to 1999, Mr. Nelson served as the Vice and President, National Gypsum Chairman and Chief Financial Officer of National Gypsum Company Company. He is also a General Partner of Wakefield Group, a North Carolina based venture capital firm. Mr. Nelson previously worked for Morgan Stanley & Co. and in the United States Defense Department as Assistant to the Secretary and was a White House Fellow. He also serves as a director of Belk, Inc. and Carolinas Healthcare System. Specific qualifications, experience, skills and expertise: Operational and management experience, including as president and chief executive officer of a building products manufacturer Senior government experience as Assistant to the Secretary of the United States Defense Department and as a White House Fellow Expertise in finance, strategic planning, business development and retail business Public company directorship and committee experience Independent of Company 18
Page 1 and 2: On The Ground Floor of Global Growt
Page 3 and 4: Dear Partners, I’m especially ple
Page 5 and 6: Building dynamic, vibrant brands ev
Page 7 and 8: Our outstanding and experienced loc
Page 9 and 10: Yum! Restaurants International, whi
Page 11 and 12: In the US, we grew same store sales
Page 13: I’d like to thank our franchise p
Page 18 and 19: Time: 9:00 a.m. on Thursday, May 19
Page 20 and 21: YUM! BRANDS, INC. 1441 Gardiner Lan
Page 22 and 23: prior to the meeting. Directions su
Page 24 and 25: of the outstanding shares of YUM co
Page 26 and 27: For a shareholder to submit a candi
Page 28 and 29: What access do the Board and Board
Page 30 and 31: Governance Committee copies of all
Page 32 and 33: Name of Committee Number of Meeting
Page 34 and 35: Who are this year’s nominees? MAT
Page 38 and 39: David C. Novak David C. Novak becam
Page 40 and 41: What am I voting on? ITEM 2: RATIFI
Page 42 and 43: What am I voting on? ITEM 3: ADVISO
Page 44 and 45: ITEM 5: PROPOSAL TO APPROVE AN AMEN
Page 46 and 47: Who are our largest shareholders? S
Page 48 and 49: (7) This amount includes 6,000 shar
Page 50 and 51: eward and retain the talented leade
Page 52 and 53: nondurable consumer products compan
Page 54 and 55: Our Named Executive Officers (NEOs)
Page 56 and 57: Meridian going forward as its indep
Page 58 and 59: 2010 Executive Compensation Decisio
Page 60 and 61: 2010 Annual Incentive Compensation
Page 62 and 63: Long-term Incentive Compensation Th
Page 64 and 65: he should receive a long-term incen
Page 66 and 67: In the case of Mr. Su, he receives
Page 68 and 69: providing employees with the same o
Page 70 and 71: MANAGEMENT PLANNING AND DEVELOPMENT
Page 72 and 73: (3) The amounts shown in this colum
Page 74 and 75: GRANTS OF PLAN-BASED AWARDS The fol
Page 76 and 77: OUTSTANDING EQUITY AWARDS AT FISCAL
Page 78 and 79: OPTION EXERCISES AND STOCK VESTED T
Page 80 and 81: Early Retirement Eligibility and Re
Page 82 and 83: NONQUALIFIED DEFERRED COMPENSATION
Page 84 and 85: (3) All amounts shown were distribu
Page 86 and 87:
actual performance for the performa
Page 88 and 89:
DIRECTOR COMPENSATION As described
Page 90 and 91:
EQUITY COMPENSATION PLAN INFORMATIO
Page 92 and 93:
AUDIT COMMITTEE REPORT Who serves o
Page 94 and 95:
ADDITIONAL INFORMATION Who pays the
Page 96 and 97:
APPENDIX A PROPOSED AMENDMENT TO AR
Page 98 and 99:
UNITED STATES SECURITIES AND EXCHAN
Page 100 and 101:
Item 1. Business. PART I YUM! Brand
Page 102 and 103:
• Traditional KFC restaurants in
Page 104 and 105:
Supply and Distribution The Company
Page 106 and 107:
Research and Development (“R&D”
Page 108 and 109:
Our China operations subject us to
Page 110 and 111:
If our franchisees incur too much d
Page 112 and 113:
We are also subject to increasing e
Page 114 and 115:
Franchising A substantial number of
Page 116 and 117:
Roger Eaton, 50, is Chief Executive
Page 118 and 119:
Issuer Purchases of Equity Securiti
Page 120 and 121:
Item 6. Selected Financial Data. Se
Page 122 and 123:
Item 7. Management’s Discussion a
Page 124 and 125:
Drive Industry-Leading, Long-Term S
Page 126 and 127:
Results of Operations Amount % B/(W
Page 128 and 129:
U.S. Business Transformation Measur
Page 130 and 131:
Under the equity method of accounti
Page 132 and 133:
The following table summarizes the
Page 134 and 135:
Restaurant Unit Activity Unconsolid
Page 136 and 137:
Multibrand restaurants are included
Page 138 and 139:
YRI 2010 vs. 2009 Income / (Expense
Page 140 and 141:
Franchise and license fees and inco
Page 142 and 143:
Worldwide Other (Income) Expense 20
Page 144 and 145:
Unallocated impairment expense in 2
Page 146 and 147:
Other. This item primarily includes
Page 148 and 149:
During the year ended December 25,
Page 150 and 151:
We sponsor noncontributory defined
Page 152 and 153:
Impairment of Goodwill We evaluate
Page 154 and 155:
Self-Insured Property and Casualty
Page 156 and 157:
Income Taxes At December 25, 2010,
Page 158 and 159:
Item 8. Financial Statements and Su
Page 160 and 161:
Consolidated Statements of Income Y
Page 162 and 163:
Consolidated Balance Sheets YUM! Br
Page 164 and 165:
Notes to Consolidated Financial Sta
Page 166 and 167:
We participate in various advertisi
Page 168 and 169:
For purposes of impairment testing
Page 170 and 171:
Fair Value Measurements. Fair value
Page 172 and 173:
If we record goodwill upon acquisit
Page 174 and 175:
Note 4 - Items Affecting Comparabil
Page 176 and 177:
Under the equity method of accounti
Page 178 and 179:
(a) Refranchising (gain) loss is no
Page 180 and 181:
The following table summarizes the
Page 182 and 183:
Note 9 - Goodwill and Intangible As
Page 184 and 185:
Note 10 - Short-term Borrowings and
Page 186 and 187:
The annual maturities of short-term
Page 188 and 189:
Note 12 - Derivative Instruments Th
Page 190 and 191:
The following tables present the fa
Page 192 and 193:
Amounts recognized in the Consolida
Page 194 and 195:
The estimated net loss for the U.S.
Page 196 and 197:
Benefit Payments The benefits expec
Page 198 and 199:
Potential awards to employees and n
Page 200 and 201:
Award Activity Stock Options and SA
Page 202 and 203:
Note 16 - Shareholders’ Equity Un
Page 204 and 205:
In 2008, the benefit was positively
Page 206 and 207:
At December 25, 2010, the Company h
Page 208 and 209:
Note 18 - Reportable Operating Segm
Page 210 and 211:
(e) 2010, 2009 and 2008 include app
Page 212 and 213:
Due to the inherent volatility of a
Page 214 and 215:
On August 4, 2006, a putative class
Page 216 and 217:
On October 14, 2008, a putative cla
Page 218 and 219:
On March 14, 2007, a lawsuit styled
Page 220 and 221:
Note 21 - Subsequent Event Subseque
Page 222 and 223:
Item 9. Changes In and Disagreement
Page 224 and 225:
PART IV Item 15. Exhibits and Finan
Page 226 and 227:
s/ Robert Holland, Jr. Robert Holla
Page 228 and 229:
(viii) 3.875% Senior Notes due Nove
Page 230 and 231:
10.20† Severance Agreement (in th
Page 232 and 233:
Shareholder Information LONG TERM I
Page 234 and 235:
Yum! brands, Inc. 2010 annual custo
Page 236:
Alone we’re delicious. Together w
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Yum! 2010 Annual Report

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