Xerox CEO John Visentin’s total compensation for his first year with the company topped $23 million in a mix of base salary, bonus awards, and stock options, the company disclosed in a regulatory filing.
The company’s compensation committee is asking shareholders to approve that total pay, as well as a projected $13 million in 2019 compensation in an advisory vote.
“During 2018, the Company conducted hundreds of calls and meetings with individual shareholders, and we received virtually no negative commentary from them concerning executive compensation,” the committee wrote in a filing. “Nevertheless, in 2019, we will establish a separate outreach program dedicated to compensation matters to ensure that we elicit and gather specific feedback that we can take into consideration as part of our shareholder engagement.”
The appointee of activist investor Carl Icahn — who started the job on May 14, 2018 — won praise from the company’s compensation committee for steering Xerox through a “turbulent” 2018 that included the ouster of the previous CEO as well as five board members, the scrapping of a deal with Fujifilm, as well as leading a reorganization of the company.
Visentin – who was a senior consultant at Icahn Enterprises until he was named CEO — was selected to lead Xerox by a board largely made up of members who owed their positions to Carl Icahn and Darwin Deason, two of the company’s majority shareholders.
Yet the compensation committee in its filing, said it still needed to woo Visentin in order to bring him on board, which included offering him a “significant one-time sign-on stock award” and “a modified single-trigger change in control agreement” good through May 2020.
“There was considerable speculation in the market about whether Xerox would continue to be an independent company,” the committee wrote. “Given that uncertainty, the Committee needed to make certain concessions to attract a CEO the Board believed was capable of stabilizing the business and engineering a turnaround.”
Visentin’s base salary was set at $756,522, with bonus and non-equity incentive awards of $3.3 million, a stock and option award of $19 million, and “other compensation” of $329,642, for a total pay package of $23.4 million. By comparison, it took ex-Xerox CEO Jeff Jacobson, three years – 2015, 2016, and 2017 – to make a total of $18.8 million.
The latest regulatory filing shows a different compensation payout than the company initially planned. In a May 14, 2018 letter to Visentin filed with the U.S. Securities and Exchange Commission, Xerox said he would receive $1.2 million base salary — almost half a million more than what he received — a maximum annual bonus of $2.4 million, a sign on bonus of $1.5 million, $10 million in stock as an initial equity award, and no less than an additional $10 million in stock as a long-term incentive.
Xerox did not respond for comment about the disparity by press time.
“Mr. Visentin’s ongoing compensation package was set at the approximate median of our competitive peer group, which we selected through methodical analysis and discussion,” the committee wrote. “We first developed a peer group list of companies that are similar to Xerox in term of industry, revenue and market capitalization. We compared against these companies to develop a range of market compensation, one of the key factors used to set compensation for our (named executive officers). Other factors included experience and performance over time. We believe that compensation packages for our NEOs are structured appropriately to the external market for their roles and that there is sufficient performance based pay to create a strong alignment with Xerox performance.”
The value of Xerox’s stock has increased since Visentin took over, with shares increasing nearly 7 percent over that time to $32.71 as of Thursday. But in its most recent Q1 earnings call, revenue was down 9.4 percent, off some $224 million, year over year. Sales were also down in Q4 by 7.8 percent, and down 4.2 percent for FY 18.