ITEM 5.02 Departure of Directors or Certain Officers; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers.
Compensation Arrangements with other Named Executve Officers
On November 5, 2020, the Copmensation and Leadership Dvelopment Committee of the
Board of Directors (the "Committee") approved special awards of time-vested RSUs
and non-qualified stock options (the "Executive Retention Awards") to executive
officers of Alaska Air Group, Inc. (the "Company").
The Executive Retention Award to Brad Tilden, the Company's CEO, consisted of
RSUs with a grant value of $750,000 and options with a total Black-Scholes grant
value of $250,000. The Executive Retention Award to Ben Minicucci, President of
Alaska Airlines, consisted of RSUs with a grant value of $562,500 and options
with a total Black-Scholes grant value of $187,500. The Executive Retention
Award to Shane Tackett, the Company's Executive Vice President Finance and Chief
Financial Officer, consisted of RSUs with a grant value of $375,000 and options
with a total Black-Scholes grant value of $125,000. The Executive Retention
Award to Andrew Harrison, the Executive Vice President and Chief Commercial
Officer of Alaska Airlines, consisted of RSUs with a grant value of $375,000 and
options with a total Black-Scholes grant value of $125,000. RSUs and options
issued pursuant to the Executive Retention Awards will vest ratably over a
three-year term based on continued service (without acceleration due to
retirement eligibility), with the first vesting scheduled to occur on November
5, 2021.
The Committee, in consultation with its advisors, determined that the Executive
Retention Awards were appropriate to meet the Company's objectives of retaining
key team members who have been stewards of the Company through the COVID-19
crisis that disproportionately affected the airline industry, sustaining
engagement, and aligning the executive team with the Company's long-term
performance as it emerges from the crisis. When valuing the Executive Retention
Awards, the Committee observed that Mr. Tilden and Mr. Minicucci took 100% base
pay reductions, and Mr. Tackett and Mr. Harrison took a 30% base pay reduction,
for over half of 2020 while having their realizable total compensation drop
significantly below target, a gap driven largely by a 45% decrease in the value
of the Company's shares since the beginning of the year (compared to a 4% rise
in the S&P 500).
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ALASKA AIR GROUP, INC. 
