Compensation of Directors
The following table provides information regarding the compensation of our outside directors for 2017. Mr. Ersek, our President and CEO, does not receive additional compensation for his service as a director, and has been excluded from the table.
|Martin I. Cole||105.0||140.0||—||—||245.0|
|Richard A. Goodman||120.0||140.0||—||25.0||285.0|
|Jack M. Greenberg(6)||44.9||360.0||—||25.0||429.9|
|Betsy D. Holden||120.0||140.0||—||20.0||280.0|
|Jeffrey A. Joerres(7)||117.9(1)||281.6||—||—||399.5|
|Roberto G. Mendoza||105.0||140.0||—||—||245.0|
|Michael A. Miles, Jr.||105.0||140.0||—||—||245.0|
|Robert W. Selander||120.0(1)||140.0||—||—||260.0|
|Frances Fragos Townsend||195.0||140.0||—||—||335.0|
|Solomon D. Trujillo||105.0||70.0||70.0||—||245.0|
Messrs. Joerres and Selander elected to receive their annual retainer fees for 2017 in the form of equity compensation as described below under “—Equity Compensation.”
The amounts in this column represent the value of stock units granted to each director as annual equity grants. Stock awards consist of fully vested stock units that are settled in shares of Common Stock and may be subject to a deferral election consistent with Code Section 409A. The amounts shown in this column are valued based on the aggregate grant date fair value computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation—Stock Compensation (“FASB ASC Topic 718”). See Note 16 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2017 for a discussion of the relevant assumptions used in calculating these amounts.
The amounts in this column represent the value of stock options granted to each director as annual equity grants. The amounts shown in this column are valued based on the aggregate grant date fair value computed in accordance with FASB ASC Topic 718. See Note 16 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2017 for a discussion of the relevant assumptions used in calculating these amounts.
All Other Compensation represents matches under the Company’s gift matching program that the Company made in 2017. Outside directors are eligible to participate in the Company’s gift matching program on the same terms as Western Union’s executive officers and employees. As noted below, contributions made or directed to be made to an eligible organization, up to an aggregate amount of $25,000 per calendar year, will be matched by the Company. Matching contributions to various charities were made in 2017 on behalf of the following directors: Messrs. Goodman and Greenberg and Ms. Holden. Contributions up to $100,000 per calendar year that a director makes to The Western Union Foundation without designating a recipient organization will be matched by the Company $2 for every $1 contributed.
As of December 31, 2017, each individual who served as an outside director during 2017 had outstanding the following number of stock units and options:
NAME STOCK UNITS OPTIONS Martin I. Cole 8,686 9,208 Richard A. Goodman 37,900 36,814 Jack M. Greenberg 71,627 336,144 Betsy D. Holden 74,549 32,699 Jeffrey A. Joerres 38,752 11,448 Roberto G. Mendoza 52,919 140,608 Michael A. Miles, Jr. 112,542 32,699 Robert W. Selander 30,644 77,439 Frances Fragos Townsend 30,063 39,833 Solomon D. Trujillo 23,177 94,334
Mr. Greenberg ceased serving as a director at the 2017 Annual Meeting of Stockholders on May 11, 2017.
Mr. Joerres began serving as Chairman of the Board at the 2017 Annual Meeting of Stockholders on May 11, 2017.
In 2017, each outside director (other than our Non-Executive Chairman) received the following cash compensation for service on our Board and committees of our Board (prorated for partial years of service):
an annual Board retainer fee of $85,000; and
an annual committee chair retainer fee of $25,000 for the chairperson of each committee of the Board (other than the Compliance Committee Chair), and a $10,000 committee member retainer fee for each other member of each committee of our Board.
In February 2017, the Board approved an increase in Ms. Fragos Townsend’s Compliance Committee Chair retainer fee to $100,000 for each of 2017 and 2018 to reflect additional time and responsibilities in leading the Compliance Committee’s oversight of the Company’s compliance with the previously disclosed settlement agreements with the United States Department of Justice, certain United States Attorney’s Offices, the United States Federal Trade Commission, the Financial Crimes Enforcement Network of the United States Department of Treasury, and various state attorneys general (the “Joint Settlement Agreements”).
The 2017 outside director equity awards were granted pursuant to our Long-Term Incentive Plan. All director equity awards will be settled in shares of Common Stock. The purpose of these awards is to advance the interests of the Company and its stockholders by encouraging stock ownership by our outside directors and by helping the Company attract, motivate, and retain highly qualified outside directors.
All of our outside directors (other than our Non-Executive Chairman) are eligible to receive an annual equity grant with a value of $140,000 for service on our Board and committees of our Board (prorated for incoming directors joining during the year).
Each outside director has the choice of electing to receive such director’s annual retainer fees described above in the form of (a) all cash, (b) a combination of cash, fully vested stock options, and/or fully vested stock units, (c) all fully vested stock options, (d) all fully vested stock units, (e) a combination of 75% fully vested stock options and 25% fully vested stock units, (f) a combination of 50% fully vested stock options and 50% fully vested stock units, or (g) a combination of 75% fully vested stock units and 25% fully vested stock options. Each outside director may also elect to receive such director’s annual equity grant in the form of any of the above alternatives, other than alternatives that include cash.
COMPENSATION OF OUR NON-EXECUTIVE CHAIRMAN
In 2017, our Non-Executive Chairman received the following compensation in lieu of the compensation described above for our other outside directors (prorated for a partial year of service as Non-Executive Chairman):
an annual retainer fee of $125,000; and
an annual equity grant with a value of $360,000.
Our Non-Executive Chairman has the choice to receive his annual retainer fee in the forms discussed above under “—Equity Compensation.”
Outside directors may participate in the Company’s gift matching program on the same terms as the Company’s executive officers and employees. Under this program, contributions up to $100,000 per calendar year that the director makes to the Western Union Foundation (the “Foundation”) without designating a recipient organization will be matched by the Company $2 for every $1 contributed. Contributions made or directed to be made to an eligible organization, as defined in the program, up to an aggregate amount of $25,000 per calendar year will be equally matched by the Company through the Foundation.
Directors are reimbursed for their expenses incurred by attending Board, committee, and stockholder meetings, including those for travel, meals, and lodging. Occasionally, a spouse or other guest may accompany directors on corporate aircraft when the aircraft is already scheduled for business purposes and can accommodate additional passengers. In those cases, there is no aggregate incremental cost to the Company, and as a result, no amount is reflected in the 2017 Director Compensation table.
Each outside director has entered into a Director Indemnification Agreement with the Company to clarify indemnification procedures. Consistent with the indemnification rights already provided to directors of the Company in the Charter, each agreement provides that the Company will indemnify and hold harmless each outside director to the fullest extent permitted or authorized by the General Corporation Law of the State of Delaware in effect on the date of the agreement or as such laws may be amended or replaced to increase the extent to which a corporation may indemnify its directors.
EQUITY OWNERSHIP GUIDELINES
Each outside director is expected to maintain an equity investment in Western Union equal to five times his or her annual cash retainer, which must be achieved within five years of the director’s initial election to the Board. The holdings that generally may be counted toward achieving the equity investment guidelines include outstanding stock awards or units, shares obtained through stock option exercises, shares owned jointly with or separately by the director’s spouse, shares purchased on the open market, and outstanding stock options received in lieu of cash retainer fees. As of March 20, 2018, all outside directors have met or, within the applicable period, are expected to meet, these equity ownership guidelines.
PROHIBITION AGAINST PLEDGING AND HEDGING OF THE COMPANY’S SECURITIES
The Company’s Insider Trading Policy prohibits the Company’s directors from pledging the Company’s securities or engaging in hedging or short-term speculative trading of the Company’s securities, including, without limitation, short sales or put or call options involving the Company’s securities.