DETROIT -- Group 1 Automotive Inc. has extended CEO Earl Hesterberg's contract through Dec. 31, 2015, and raised his base salary 10 percent.
Under a new employment agreement effective Sept. 8, the nation's fourth-largest automotive retailer said Hesterberg will receive an annual base salary of $1 million. His 2009 base salary was $908,333.
In February 2009, in response to the industry's sales downturn, Group 1 reduced salaries for Hesterberg, directors and other senior executives by 10 percent. Other Group 1 employees were subject to a 5 percent salary cut. At the time, Hesterberg's salary was lowered by about $100,000 to $900,000, according to the company's 2010 proxy statement.
Group 1 directors voted to reinstate the salary cuts in July, a company spokesman said today.
Hesterberg's base salary may be adjusted by the company's directors from time to time, according to a filing Thursday with the U.S. Securities and Exchange Commission.
Hesterberg, 57, received $3.3 million in compensation for 2009, including $1.1 million in restricted stock awards and $1 million in non-equity incentive pay.
Group 1 also granted Hesterberg 120,000 shares of restricted stock under the company's long term incentive plan.
According to the company's documents, 40 percent of the shares will vest on Sept. 8, 2012; 20 percent will vest on Sept. 8, 2013; another 20 percent will vest on Sept. 8, 2014; and the remaining twenty percent will vest on Sept. 8, 2015.
Hesterberg joined Group 1 as president and CEO in April 2005 after serving as group vice president for North America marketing, sales and service at Ford Motor Co.