SkyWest Airlines 2014 Annual Report Download - page 145

because it believes the use of operational and individual goals allows awards to reflect the individual
efforts and achievements of an Executive that may not be reflected by corporate financial performance.
The actual amount of the bonus payment for each Executive is determined by the Compensation
Committee based on the Executive’s achievement of his goals.
For fiscal year 2014, the Compensation Committee reviewed and approved the individual goals for
the Executives and following year-end, determined the extent to which those goals were attained. The
actual payout of the portion of an Executive’s annual bonus incentive related to individual goals is
increased or decreased, as applicable, based on the degree to which the Executive achieved his
individual goals.
The corresponding results for each Executive for the year ended December 31, 2014, are set forth
below as a percentage of each Executive’s salary.
Pretax Pretax
Objective earnings & earnings & Operational & Operational & Total Annual
Percentage Financial Financial Individual Individual Bonus
of Salary Target Results Target Results Results
Jerry C. Atkin .......... 80% 40.0% 31.6% 40.0% 35.9% 67.5%
Russell A. Childs ....... 80% 40.0% 31.6% 40.0% 51.1% 82.7%
Wade J. Steel .......... 80% 40.0% 31.6% 40.0% 47.1% 78.7%
Bradford R. Rich ....... 80% 40.0% 31.6% 40.0% 31.9% 63.5%
Michael B. Thompson .... 80% 40.0% 43.3% 40.0% 35.2% 78.5%
Bradford R. Holt ....... 80% 40.0% 19.9% 40.0% 33.4% 53.3%
Michael J. Kraupp ...... 60% 30.0% 23.7% 30.0% 23.9% 47.6%
Amount of 2014 Performance-Based Annual Bonus. The total annual performance-based bonus
amounts payable to the Executives for 2014 were: Mr. Atkin—$283,676; Mr. Childs—$237,593;
Mr. Steel—$146,140; Mr. Rich—$185,039; Mr. Thompson—$138,239; Mr. Holt—$104,091 and
Mr. Kraupp—$87,812. Those amounts are included in the amounts shown in the Summary
Compensation Table below under the caption heading ‘‘Non-Equity Incentive Plan Compensation.’’
Discretionary 2014 Bonus. In addition to the performance-based bonuses described above, the
Compensation Committee also exercised discretion in 2014 and paid a discretionary bonus of $19,100
to Mr. Childs and $12,345 to Mr. Steel in recognition of their efforts to address and mitigate unique
challenges attributable to ExpressJet’s operations, including reimbursement rates payable under
ExpressJet’s contracts with its major partners, maintenance costs associated with ExpressJet’s aging fleet
and operational reliability. Messrs. Atkin, Rich, Thompson, Holt and Kraupp did not receive a
discretionary bonus. The discretionary bonuses paid to Messrs. Childs and Steel in 2014 are included in
the amounts shown in the Summary Compensation Table below under the caption heading
‘‘Discretionary Bonus.’’
2015 Annual Bonus. The Compensation Committee determined to make some changes to the
annual bonus calculation for 2015 in an effort to better align the bonus with the creation of
shareholder value and to align the compensation packages of the Executives with the executive
compensation programs of other regional carriers and major airlines. The 2015 annual bonus objective
will be of 100% of salary for the Chief Executive Officer and President, 80% of salary for the Chief
Commercial Officer, Chief Financial Officer and Chief Operating Officers of the Company’s operating
subsidiaries and 60% of salary for other Executives. The bonus objective will be based on pretax
earnings (weighted 65%), operating performance (weighted 25%) and cash flow from operations
(weighted 10%). The differing percentages for the Executives are due to differing entity level
responsibilities.
28