XM Radio 2015 Annual Report Download - page 43

informed judgment, taking into account the executive’s role and responsibilities and our overall
performance and the performance of our common stock, and is not based on any specific
quantitative or qualitative factors.
Fiscal Year 2015 Pay Results
2015 Base Salary Decisions
We have entered into employment agreements with each of our named executive officers.
During 2015, the Compensation Committee approved increases to each of our named executive
officers’ base salaries. Such increases were approved in connection with the extension of three
executive’s employment agreements and two executives’ promotions in 2015.
Mr. Meyer Increased from $1,550,000 to $1,800,000 in August 2015
Mr. Frear Increased from $850,000 to $1,200,000 in July 2015
Ms. Altman Increased from $500,000 to $600,000 in June 2015
Mr. Cady Increased from $400,000 to $600,000 in June 2015
Mr. Verbrugge Increased from $355,000 to $500,000 in December 2015
Payment of Performance-Based Discretionary Annual Bonuses for 2015
In 2015, the Compensation Committee again adopted, under the Sirius XM Holdings Inc. 2015
Long-Term Stock Incentive Plan, a bonus program designed to qualify as “performance-based
compensation” within the meaning of Section 162(m) of the Internal Revenue Code (the “NEO
Bonus Plan”). Pursuant to the NEO Bonus Plan, a bonus pool was established for our Chief
Executive Officer and the other named executive officers, other than our Chief Financial Officer,
consisting of 2.75% of our EBITDA for 2015. The maximum bonus that a named executive officer
could receive under the NEO Bonus Plan was limited to a percentage of the bonus pool (which
percentages were not changed during the performance year) and could not exceed the cash
equivalent of 75 million shares of our common stock (based on the closing price of our common
stock as of the last trading day of 2015). In addition, no amounts could be paid under the NEO
Bonus Plan unless a threshold amount of EBITDA was achieved for 2015.
In 2016, the Compensation Committee met to consider bonuses for our named executive
officers with respect to 2015 and whether to award bonuses for other employees. The
Compensation Committee carefully reviewed our performance against key metrics in our budget and
bonus plan, including the generation of EBITDA, as required by the NEO Bonus Plan, and our
efforts to increase subscribers, revenue, adjusted EBITDA and free cash flow.
Following its review of our 2015 performance, the Compensation Committee:
•approved a cash bonus pool to be divided among our employees, other than the named
executive officers;
•reviewed the NEO Bonus Plan pool and exercised negative discretion, approving the
individual bonus amounts awarded to each of the named executive officers under the NEO
Bonus Plan; and
•reviewed and approved the payment to our Chief Financial Officer whose bonus, pursuant to
Section 162(m) of the Internal Revenue Code, is not included in the NEO Bonus Plan.
The actual amount of the bonus paid to each named executive officer was based on a
combination of factors, including our 2015 corporate performance, their individual contributions and
performance in their functional areas of responsibility and, with respect to all named executive
officers other than himself, recommendations made by Mr. Meyer. Various specific factors taken
into consideration in determining the bonus amounts for the named executive officers are set forth
33