EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
The Company’s compensation committee reviews and establishes executive compensation in
connection with each executive officer’s employment agreement. We entered into new employment
agreements with W. Kent Taylor, Scott M. Colosi, Celia P. Catlett, and S. Chris Jacobsen, each a
Named Executive Officer, on December 26, 2017, each of which has an effective date of January 8,
2018 and expires on January 7, 2021. We entered into an employment agreement with Tonya R.
Robinson, also a Named Executive Officer, on June 11, 2018 and having an effective date of May 18,
2018, and with Doug W. Thompson, also a Named Executive Officer, on August 23, 2018, each of
which expires on January 7, 2021. In connection with Ms. Robinson’s appointment to Chief Financial
Officer, the Company and Mr. Colosi entered into an amendment to his 2018 Employment Agreement
on May 17, 2018 to reflect his resignation as Chief Financial Officer of the Company while still
remaining as President of the Company. As used herein, the employment agreements, as amended (as
and if applicable), with Messrs. Taylor, Colosi, Jacobsen, and Thompson and Mss. Catlett and Robinson
shall be referred to collectively as the ‘‘2018 Employment Agreements’’ and with respect to any Named
Executive Officer, as a ‘‘2018 Employment Agreement’’.
To assist in setting compensation under the 2018 Employment Agreements and pursuant to the
authority granted under its charter, the compensation committee engaged Willis Towers Watson as an
independent compensation consultant in 2017 to advise the compensation committee on compensation for
the executive officers and the non-employee directors, together with analysis and services related to such
executive and director compensation. Specifically, the compensation committee asked the consultant to
provide market data, review the design of the executive and director compensation packages, and provide
recommendations on cash and equity compensation for the Company’s executive officers and the
non-employee directors. Willis Towers Watson does not currently provide any other services to the
Company, and the compensation committee has determined that Willis Towers Watson has sufficient
independence from us and our executive officers to allow it to offer objective information and advice. All
fees paid to Willis Towers Watson during fiscal year 2017 were in connection with their engagement by
the compensation committee for the above services.
Each 2018 Employment Agreement establishes a base salary throughout the term of the agreement,
and a cash incentive bonus amount based on the achievement of defined goals to be established by the
compensation committee. In addition to cash compensation, the 2018 Employment Agreements also
provide the compensation committee with an opportunity to make annual stock awards to the Named
Executive Officers, the types and amounts of which are subject to the compensation committee’s
discretion based on their annual review of the performance of the Company and of the individual Named
Executive Officers. The types of stock awards contemplated by the 2018 Employment Agreements are
(i) restricted stock units, which grant the Named Executive Officers the conditional right to receive shares
of our common stock that vest after a defined period of service, (ii) ‘‘retention’’ restricted stock units,
which vest upon the completion of the term of an individual Named Executive Officer’s agreement or
such longer date as determined by the compensation committee, and (iii) performance stock units, which
are calculated based on the achievement of certain Company performance targets established by the
compensation committee and vest over a period of service. As of the date of this proxy statement and as
more particularly described below, each Named Executive Officer has received an annual grant of
restricted stock units relating to their 2018 year service (which were granted in 2017 or 2018 [as
applicable]) and their 2019 year service (which were granted in 2019). Additionally, each of Messrs. Taylor,
Colosi, Jacobsen, and Thompson have received grants of performance stock units relating to their 2018
and/or 2019 year service (as applicable). Moreover, each of Messrs. Colosi, Jacobsen, and Thompson
and Mss. Catlett and Robinson have received ‘‘retention’’ grants of restricted stock units under their
respective 2018 Employment Agreements, which vest upon the completion of the term of the
agreement on the condition that the applicable Named Executive Officer is still serving the Company