Alaska Airlines and Horizon Air 2014 Annual Report Download - page 61

2014 Equity Awards – For 2014, the guidelines applied to the Named Executive Officers are noted in
the table below:
Equity Award Guidelines
Equity
Target as a
% of Base
Pay
Equity Mix
Name
Stock
Options
Restricted
Stock Units
Performance
Stock Units
Bradley D. Tilden 300% 34% 33% 33%
Brandon S. Pedersen 200% 34% 33% 33%
Benito Minicucci 250% 34% 33% 33%
Andrew R. Harrison 125% 34% 33% 33%
Joseph A. Sprague 125% 34% 33% 33%
Glenn S. Johnson 200% 34% 33% 33%
Keith Loveless 200% 34% 33% 33%
Special Equity Awards – The Committee retains
discretion to make other equity awards at such
times and on such terms as it considers
appropriate to help achieve the goals of the
Company’s executive compensation program.
In May 2014, in light of the promotion of
Mr. Pedersen to executive vice president and of
Mr. Sprague and Mr. Harrison to senior vice
president, the Committee made a one-time
equity award to each composed of 50%
restricted stock units and 50% stock options.
The Committee also made an additional equity
award of the same proportions to Mr. Minicucci
based on the adjustment of his equity award
target from 200% to 250% of base salary in
recognition of the scope of his leadership role.
With respect to each of these executives, the
Committee approved awards that were
calculated by deducting the equity grant value
the executive received at the annual grant made
in February from the equity grant value he would
have received at the increased equity award
target (and, in the case of Mr. Harrison and
Mr. Sprague, the increased base salary) for the
portion of the year he would serve in the more
responsible role. The awards are designed to
motivate executives to achieve superior financial
results over the three-year period ending May 11,
2017 (for the restricted stock units) and over the
four-year period ending May 11, 2018 (for the
stock options).
Perquisites and Personal Benefits
In 2014, an amount equal to 8% of base salary
was paid to each Named Executive Officer in lieu
of all perquisites except for travel, life insurance,
health exams, and accidental death and
dismemberment insurance. The Committee
decided to phase out this perquisite allowance
over a three-year period that began in 2014.
Retirement Benefits/Deferred Compensation
The Company provides retirement benefits to the
Named Executive Officers under the terms of
qualified and non-qualified defined-benefit and
defined-contribution retirement plans. The
Retirement Plan for Salaried Employees (the
Salaried Retirement Plan) and the Company’s
401(k) plans are tax-qualified retirement plans in
which Mr. Tilden, Mr. Sprague, Mr. Johnson, and
Mr. Loveless participate on substantially the
same terms as other participating employees.
The Salaried Retirement Plan was frozen on
January 1, 2014 at its then-current benefit
levels. Due to maximum limitations imposed by
the Employee Retirement Income Security Act of
1974 and the Internal Revenue Code on the
annual amount of a pension which may be paid
under a qualified defined-benefit plan, the
benefits that would otherwise be provided to
these executives under the Salaried Retirement
Plan are required to be limited. An unfunded
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EXECUTIVE COMPENSATION 49