(WASHINGTON) – Shareholders of Allegiant Travel Company [NYSE: ALGT] registered strong support for more robust executive pay policies and independent board oversight at the company’s annual meeting yesterday.
A shareholder proposal sponsored by the International Brotherhood of Teamsters seeking to prevent unearned windfall awards being paid to executives in the event of a change of control won majority support, 56.8 percent, by public shareholders.
The proposal calls on Allegiant’s board to adopt a policy that makes clear that equity awards granted to senior executives will not automatically, fully vest in the event of a change of control. ISS, the country’s leading proxy advisor, recommended Allegiant shareholders vote for the proposal.
In addition, Allegiant’s public shareholders voted by 47 percent against the election of Linda Marvin, Chair of the board’s audit committee.
“This is a significant vote of no confidence against the leadership of the board’s audit committee,” said Ken Hall, Teamsters General Secretary-Treasurer. “The audit committee is ultimately responsible for overseeing the management of risk and ensuring legal and regulatory compliance at the carrier.”
The embattled low-cost carrier has been plagued with numerous delays and cancellations due to maintenance and operating difficulties. Yesterday, Allegiant grounded six flights out of St.Pete/Clearwater International Airport after a reported emergency landing, the second at the same airport this month. Steve Harfst, Allegiant’s Chief Operating Officer announced yesterday that the airline will continue to sub-service flights it cannot cover with their own crews and airplanes throughout the summer. Allegiant spent $25 million in sub-service flights in 2014 alone.
The International Brotherhood of Teamsters, a long-term Allegiant shareholder, represents 1.4 million hardworking men and women throughout the United States, Canada, and Puerto Rico including more than 500 pilots at Allegiant Air. Visit www.teamster.org for more information. Follow us on Twitter @Teamsters and “like” us on Facebook at www.facebook.com/teamsters.