Summary
UnitedHealth Group Incorporated (UNH) filed an 8-K on June 30, 2006, detailing a change in its non-employee director compensation policy, effective immediately as of June 26, 2006. The core change restricts the conversion of director compensation into stock options. Previously, directors could elect to convert all annual cash retainers and meeting attendance fees (including special meetings) into nonqualified stock options. The revised policy now limits this conversion option exclusively to annual cash retainers and cash attendance fees for regularly scheduled quarterly board or committee meetings. The Board of Directors has determined that cash payments are more appropriate for attendance at special meetings, reflecting a strategic shift in how director compensation is structured. This alteration aims to align compensation more directly with specific duties and meeting types.
Key Highlights
- 1Change in director compensation policy effective June 26, 2006.
- 2Annual cash retainers and quarterly meeting fees remain convertible to nonqualified stock options.
- 3Cash attendance fees for special meetings are no longer convertible to stock options.
- 4Directors will now be paid in cash for attending special board or committee meetings.
- 5The Board of Directors believes this change better reflects compensation for special meeting attendance.