ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION
The Company is providing stockholders an advisory vote to approve executive compensation as required by Section 14A of the Exchange Act. Section 14A was added to the Exchange Act by Section 951 of the Dodd-Frank Act. The advisory vote to approve executive compensation is a non-binding vote on the compensation of the Company’s NEOs, as described in the “Compensation Discussion and Analysis” section, the tabular disclosure regarding such compensation, and the accompanying narrative disclosure set forth in this Proxy Statement. The advisory vote to approve executive compensation is not a vote on the Company’s general compensation policies or the compensation of the Company’s Board of Directors. The Dodd-Frank Act requires the Company to hold the advisory vote to approve executive compensation at least once every three years. At the 2017 Annual Meeting of Stockholders, the Company asked stockholders to indicate if it should hold an advisory vote to approve the compensation of named executive officers every one, two or three years, with the Board recommending an annual advisory vote. Our stockholders approved this recommendation. Accordingly, the Company is again asking stockholders to approve the compensation of NEOs as disclosed in this Proxy Statement.
At the 2019 Annual Meeting of Stockholders, the Company provided stockholders with the opportunity to cast an advisory vote to approve the compensation of the Company’s NEOs as disclosed in the Proxy Statement for the 2019 Annual Meeting of Stockholders, and the Company’s stockholders overwhelmingly approved the proposal, with approval by approximately 93% of the votes cast for the proposal at the 2019 Annual Meeting of Stockholders.
The Company believes that its compensation policies and procedures, which are outlined in the “Compensation Discussion and Analysis” section of this Proxy Statement, support the goals of:
- Aligning our executives’ goals with our stockholders’ interests;
- Attracting, retaining, and motivating outstanding executive talent; and
- “Pay-for-performance” - Holding our executives accountable and rewarding their achievement of financial, strategic and operating goals.
The Compensation Committee of the Board continually reviews the Company’s executive compensation and benefits program to evaluate whether it supports these goals and serves the interests of the Company’s stockholders. The Company’s executive compensation practices include the following, as discussed in more detail in the “Compensation Discussion and Analysis” section of this Proxy Statement:
- Pay-for-performance and at-risk compensation.
- Align compensation with stockholder interests.
- Emphasis on future pay opportunity vs. current pay.
- Mix of performance metrics.
- Stockholder engagement.
- “Clawback” policy.
- Robust stock ownership guidelines.
- Three-year performance period for PSUs.
- Outside compensation consultant retained by the Compensation Committee.
- “Double trigger” severance benefits in the event of a change-in-control.
- Maximum payout caps for annual cash incentive compensation and PSUs.
- Consider compliance in compensation program.
- No repricing or buyout of underwater stock options.
- No change-in-control tax gross ups for individuals promoted or hired after April 2009.
- No dividends or dividend equivalents paid on unvested or unearned PSUs or RSUs.
- Prohibition against pledging and hedging of Company securities by senior executives and directors.
We believe that our executive compensation practices, in combination with a competitive market review, limited executive perquisites, and reasonable severance pay multiples contribute to an executive compensation program that is competitive yet strongly aligned with stockholder interests.
The Board recommends that you vote in favor of the following “say-on-pay” resolution:
RESOLVED, that the stockholders of the Company approve, on an advisory basis, the compensation of the Company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K in the "Compensation Discussion and Analysis" section, the tabular disclosure regarding such compensation, and the accompanying narrative disclosure, each as set forth in the Company’s Proxy Statement for its 2020 Annual Meeting of Stockholders.
The affirmative vote of the holders of a majority of shares of the Company’s Common Stock present in person or represented by proxy at the meeting and entitled to vote on the subject matter is required to approve this Proposal 2.
Because your vote is advisory, it will not be binding upon the Board of Directors. However, the Compensation Committee may take into account the outcome of the vote when considering future executive compensation arrangements. Stockholders attending the Annual Meeting via webcast are deemed to be present “in person”.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR PROPOSAL 2.