DEF 14A of Alaska Air Group, Inc., Mar 30, 2026

DEF 14A of Alaska Air Group, Inc.

Filed Mar 30, 2026 · FY20250001193125-26-132048

Open on EDGAR

  1. Board Committee and Risk Oversight Functions

    | Compensation and Leadership Development Committee | With regard to matters pertaining to executive and director compensation and executive leadership under Alaska’s Chief People Officer and guidance from an independent consultant: o set, review and approve compensation of the Company's CEO and other elected officers of the Company and its subsidiaries; and o establish the process for reviewing and approving corporate goals relevant to the Alaska Air Group CEO's compensation and for evaluating CEO performance in light of those goals. • Set annual goals under the broad-based Performance-Based Pay Plan and Operational Performance Rewards Plan and administer the plans. • Grant equity-based awards to elected officers. • Administer and review the supplementary retirement plans for elected officers and the equity-based incentive plans. • Make recommendations to the Board regarding other executive compensation matters. • Fulfill ERISA fiduciary and non-fiduciary functions for tax-qualified retirement plans by monitoring management benefit committees and approving the membership of those committees and the extension of plan participation to employees of subsidiaries. • Approve the terms of employment and severance agreements with elected officers and the form of change-in-control agreements. • Review CEO and other management development and succession plans, including standards for assessment of individual development activities and progress. • Administer and make recommendations to the Board of Directors with respect to long-term incentive equity plans. • Administer, review and modify the Company’s clawback policy regarding recoupment of certain compensation payments. • Oversee the development, implementation and progress of the Company's workforce management polices and strategies. • Review the report on executive compensation required for the annual proxy statement. • Annually review and reassess the adequacy of the Compensation and Leadership Development Committee’s charter and its performance. |

  2. 2025 Director Compensation Table

    2025 Director Compensation Table

  3. 2025 Director Compensation Table

    | Name | Fees Earned or Paid in Cash ($) | Stock Awards (1) ($) | All Other Compensation (2) ($) | Total ($) | | Patricia M. Bedient | 240,001 | 139,999 | 25,731 | 405,731 | | James A. Beer | 110,001 | 139,999 | 15,494 | 265,494 | | Raymond L. Conner | 115,001 | 139,999 | 12,992 | 267,992 | | Daniel K. Elwell | 110,001 | 139,999 | 15,114 | 265,114 | | Kathleen T. Hogan | 110,001 | 139,999 | 98,148 | 348,148 | | Adrienne R. Lofton | 90,001 | 139,999 | 10,795 | 240,795 | | Helvi K. Sandvik | 90,001 | 139,999 | 10,795 | 240,795 | | Peter A. Shimer | 90,001 | 139,999 | 12,873 | 242,873 | | Eric K. Yeaman | 140,001 | 139,999 | 36,481 | 316,481 |

  4. 2025 Director Compensation Table

    In May 2025, Mr. Beer, Ms. Hogan, Ms. Lofton, Mr. Shimer and Mr. Yeaman were each granted 2,653 vested and deferred stock units (DSUs), based on their 2024 elections to defer 100% of their 2025 stock retainers. Mr. Elwell deferred 50% of his 2025 stock retainer and received 1,327 DSUs and 1,326 vested shares. Ms. Bedient, Mr. Conner, and Ms. Sandvik were each issued 2,653 vested shares. See discussion of these awards in Note 12 (Stock-Based Compensation Plans) to the Company’s Consolidated Financial Statements included as part of the Company’s 2025 Annual Report filed on Form 10-K with the SEC and incorporated herein by reference. The non-employee directors do not hold any outstanding stock options. They also do not participate in any non-equity incentive compensation plans, nor do they participate in a nonqualified deferred compensation plan (other than the election to receive DSUs as noted above). Non-employee directors do not receive pension benefits for their service. As part of each director’s compensation, the non-employee director and the non-employee director’s spouse or domestic partner and eligible dependents are provided complimentary, positive-space transportation on Alaska Airlines, Horizon Air and Hawaiian Airlines. Included in the “All Other Compensation” column for each non-employee director is the incremental cost to the Company for providing this travel to the director and any eligible family members. Positive-space travel is a benefit unique to the airline industry. By providing this travel to non-employee directors, the Company is able to deliver a highly valued benefit at a low cost, and believes this benefit encourages non-employee directors to experience and engage with Alaska, Hawaiian and Horizon employees and services. Each director also receives an annual award of $10,000 worth of Atmos Rewards Points that can be, among other things, used to purchase tickets on oneworld partners so that directors can experience partner airlines. The “All Other Compensation” column also includes the value of reimbursements for taxes on the transportation benefits provided to each director. Mr. Yeaman's "Fees Earned or Paid in Cash" total includes $20,000 for services rendered as a member of the Hawaiian Holdings, Inc. Board of Directors in 2025. Director Stock Ownership Policy The Company has adopted a stock ownership policy for directors, although the Company expects directors to act in the Company’s best interests regardless of the number of shares they own. Each non-employee director is expected to hold shares of Company stock having a value equal to at least six times the director’s annual cash retainer, including subsidiary board cash retainers, with such ownership to be achieved within six years of joining the Board. DSUs held by directors, which are 100% vested as of the grant date, count toward the holding requirement even though shares will not be issued with respect to deferred units until the director leaves the Board. All non-employee directors have met this requirement or are on schedule to meet this requirement as of December 31, 2025, except Mr. Shimer, who joined the Board in 2025 and has until 2031 to comply with the director stock ownership policy.

  5. 2025 Director Compensation Table

    | NAMED EXECUTIVE OFFICER COMPENSATION |

  6. 2025 Director Compensation Table

    Proposal 2: Approval (on an Advisory Basis) of the Compensation of the Company’s Named Executive Officers The Company is providing its shareholders with the opportunity to cast a non-binding, advisory vote on the compensation of the Company’s Named Executive Officers (NEOs) as disclosed pursuant to SEC’s rules and set forth in this Proxy Statement (including the compensation tables and the narrative discussion accompanying those tables as well as in the Compensation Discussion and Analysis). As described more fully in the Compensation Discussion and Analysis (CD&A) section, the structure of the Company’s executive compensation program is designed to compensate executives appropriately and competitively to drive superior performance and support shareholder alignment. For the NEOs, who are responsible for the overall execution of the Company’s strategy, a high percentage of total direct compensation1 is variable and tied to the achievement of specified performance goals and/or the value of the Company’ stock. Results of the Company's incentive-based executive compensation programs are linked to performance on the Company’s operational, financial and strategic goals so that executives’ interests are aligned with shareholders' interests. The CD&A describes in more detail the Company’s executive compensation programs and the decisions made by the Compensation and Leadership Development Committee (referred to in this section as the Committee) during 2025. 1 The Company defines "total direct compensation" as base salary, actual short-term incentive pay and the grant date fair value of equity awards as determined for accounting purposes.

  7. Executive Compensation Elements

    Executive Compensation Elements The Company's 2025 executive compensation program included three core elements: Base Salary In February 2025, the Committee set the annual base salary level for Mr. Minicucci at approximately the 25th percentile of the base salaries of chief executive officers in the transportation and travel peer group identified in the CD&A. The Committee set base salaries for the other NEOs slightly below the median base salaries for corresponding positions in these same peer groups or general industry companies where relevant factoring in tenure, performance and scope of responsibilities. Annual Incentive Pay The NEOs are eligible to earn incentive pay under the Company's annual Performance Based Pay (PBP) Plan, in which all employees participate with the same performance goals. The PBP Plan is intended to motivate all participants to achieve specified Company goals. For 2025, the plan focused on four key areas: profitability, safety reporting, guest experience and integration-related synergy capture. Refer to the CD&A for more detailed information on the structure and payout of the PBP. Long-Term Incentive Pay Equity-based incentive awards that link executive pay to shareholder value generation are an important element of the Company’s executive compensation program and comprise the largest portion of pay for NEOs. Long-term equity incentives that vest over three-year periods are awarded annually, including performance stock units (PSUs) and restricted stock units (RSUs). The NEOs’ 2025 equity grant was approximately 50% PSUs and 50% RSUs (based on the grant date value of the awards). The Committee grants equity awards annually which results in overlapping vesting periods that discourage short-term risk taking and align NEOs’ long-term interests with those of shareholders while helping the Company attract and retain top-performing executives who fit a team-oriented and performance-driven culture. In general, the Committee sets target annual incentive pay and annual equity grants at levels intended to provide executives an opportunity to achieve target total direct compensation1 at approximately the 50th percentile of the target total direct compensation for comparable positions with the peer companies if the applicable annual and long-term incentive targets are reached, and to surpass the 50th percentile if those targets are exceeded. 1 The Company defines "target total direct compensation" as base salary, target short-term incentive pay and the grant date fair value of equity awards as determined for accounting purposes.

  8. Philosophy and Objectives of the Company’s Executive Compensation Program

    Philosophy and Objectives of the Company’s Executive Compensation Program The philosophy of the Company’s executive compensation program in 2025 was consistent with that of prior years: being responsible stewards of shareholder resources while compensating executives appropriately and competitively for driving superior performance relative to other airlines in North America. Because the NEOs are primarily responsible for the overall execution of the Company’s strategy, a high percentage of their target total direct compensation, approximately 90% for the CEO and 81% for the other NEOs, is variable and tied to Company performance or stock price, thereby providing incentives to achieve goals that the Company believes create value for shareholders. The fundamental objectives of the executive compensation program are: to attract and retain highly qualified executives who share the Company’s values and are committed to its strategic plan by designing the total compensation package to be competitive with an appropriate peer group as there is substantial competition for talent in key geographies; to motivate executives to provide excellent leadership and achieve Company goals by linking incentive pay to the achievement of specific targets set in the PBP Plan and the Company’s strategic plan; and to align the interests of executives and shareholders by tying a large portion of executives’ target total direct compensation to the achievement of objective goals related to the Company’s financial performance, safety record, cost structure and guest satisfaction. 2025 Compensation Actions: To implement the executive compensation program for 2025, the Committee took the following steps in February 2025: • Evaluated executive compensation against a new peer group that was selected to more closely align with the Company's revenues and the complex, operations-heavy, asset-intensive and consumer-oriented nature of its business. • Approved target total direct compensation for Mr. Minicucci that is approximately 90% performance-based, meaning that it is contingent on operational, financial and/or stock price performance. For the other NEOs, the Committee approved target total direct compensation that is, on average, approximately 81% performance-based (see the Target Total Direct Compensation section below). Both the short-term and long-term incentive programs contain performance-based metrics and goals that contribute to the long-term success of the Company. • Established 2025 performance metrics, goals and participation rates for the PBP Plan. The metrics under this plan include profitability, safety reporting, guest experience, integration-related synergy capture, and relative industry financial performance. All employees of Alaska Airlines--including those employed by Hawaiian Airlines prior to the Company achieving a Single Operating Certificate--and Horizon Air participated in the 2025 PBP plan and have their bonuses determined using the same goals. • Approved long-term incentive equity awards to NEOs. Each NEO's grant consisted of 50% of service-based RSU awards, and 50% of PSU awards that vest only if specified, sustained three-year return on invested capital (ROIC) performances goals are achieved. The Committee believes these awards and use of ROIC in the PSUs further align executives’ incentives with the creation of long-term value for shareholders.

  9. Compensation Setting Philosophy

    Compensation Setting Philosophy In 2025, the Committee targeted the CEO’s base salary at approximately the 25thpercentile of the chief executive officers in the peer group identified below. The Committee may decide to set the CEO’s salary above or below that percentile after considering other relevant factors. The CEO’s compensation arrangements are generally structured to provide the opportunity to earn total direct compensation up to approximately the 50th percentile of the target total direct compensation of peer companies’ chief executive officers if the applicable annual and long-term incentive targets are reached, and to surpass the 50th percentile if those targets are exceeded. For the other NEOs, the Committee generally targets base salary at or about the median of base salaries versus the compensation peer group and provides an opportunity to achieve total direct compensation at the 50thpercentile of the target total direct compensation for comparable positions with the peer companies if annual and long-term incentive targets are reached, and to surpass the 50th percentile if those targets are exceeded. While the Committee generally sets executive pay at the levels indicated above, it may also consider other factors, such as Company performance, individual performance, tenure, retention goals, succession considerations, and internal equity, in determining the compensation levels for executives from year to year as appropriate.

  10. The Use of Peer Group Compensation Data

    The Use of Peer Group Compensation Data Prior to 2025, the Company utilized two peer groups (i.e. both the Airline peer group and Transportation & Travel peer group), with the Airline group used as the primary reference point for pay level comparison and program design. In late 2024 the Company completed a market review with Meridian to determine whether changes to the dual peer group approach were needed following the Company's combination with Hawaiian Airlines. Based on that review, the Committee approved a new combined transportation industry peer group comprised of select companies from the Airline and the Transportation & Travel groups that the Committee believes better reflects the Company's size and operational complexity for setting 2025 compensation. The following companies represent the new transportation industry peer group selected by the Committee as a comparator for determining appropriate compensation levels for 2025:

  11. The Use of Peer Group Compensation Data

    | • Air Canada • American Airlines Group • Avis Budget Group • C.H. Robinson Worldwide • Carnival Corporation & Plc • Delta Air Lines • Expedia Group • Expeditors International of Washington • Hertz Global Holdings • J.B. Hunt Transport Service | • JetBlue Airways • Knight-Swift Transportation Holdings • Lyft • Norfolk Southern • Norwegian Cruise Line Holdings • Royal Caribbean Group • Ryder Systems • Southwest Airlines • United Airlines Holdings • XPO |

  12. The Use of Peer Group Compensation Data

    The Committee chose to include the companies named above in its transportation industry peer group for the following reasons: Shared business characteristics of the Company, such as travel/transportation industry, consumer-focused, operationally complex and asset-intensive; • Overall median annual revenues approximates the Company’s annual revenue to represent business complexity; and • Includes competitors to fill certain key, industry-related executive positions. 2025 target total direct compensation for the NEOs was generally set in reference to the median for comparable positions at companies in this peer group. Target total cash compensation (i.e. base salary and target short-term incentive pay) for the NEOs was set below the median for comparable positions at companies in the peer group, and target total direct compensation was between approximately the 25th and 50th percentiles. For the CEO, target total cash compensation was set below the median and target total direct compensation was targeted at approximately the 25th percentile for chief executive officers within the transportation and travel industry peer group. In general, the Committee uses this peer group as background information for its compensation decisions and does not “benchmark” compensation at any particular level relative to the peer companies. Except as otherwise noted in this CD&A, decisions by the Committee are qualitative and the result of the Committee’s business judgment, which is informed by the analysis of the members of the Committee as well as input from, and market data provided by, its independent compensation consultant. The Committee believes that the compensation opportunities provided to the NEOs are appropriate in light of competitive considerations.

  13. The Application of Internal Equity Considerations

    The Application of Internal Equity Considerations In addition to reviewing compensation data for the Company's peer group, the Committee believes it is appropriate to consider other principles of compensation, and not rely on market data as the sole basis for setting compensation. Thus, while the Committee has considered peer group data as described above, it has also applied other compensation principles, including internal equity, when determining executive compensation. By also considering internal equity, the Committee can structure executive compensation in a way that helps ensure appropriate compensation in light of atypical internal or external pressures or compensation considerations.

  14. Base Pay

    Base Pay In determining executives’ base salary levels, the Committee considers market compensation data as described above, as well as each executive’s duties and scope of responsibilities, past performance and expected future contributions to the Company, the market demand for the individual’s skills, the individual’s influence on long-term Company strategies and success, the individual’s leadership performance, and internal equity considerations. In 2025, the Committee approved a base salary of $900,000 for Mr. Minicucci effective April 12, 2025, which was 23% higher than his 2024 level. The Committee believes this increase was appropriate based on the following considerations: 1. The Committee recognized Mr. Minicucci's leadership through the most complex time of the Company's integration with Hawaiian Airlines in 2025, including the start of long-haul international flights from Seattle, the launch Company's new loyalty program and the achievement of a Single Operating Certificate. 2. The Committee's longstanding compensation-setting philosophy has been to set CEO base pay at approximately the 25th percentile of salaries for CEOs in the Company's peer group. Mr. Minicucci's 2025 base pay is consistent with this approach. 3. The Committee has generally set CEO total target compensation to include a large percentage of pay that is tied to Company performance. Mr. Minicucci's target total compensation in 2025 included the same ratio of base pay to variable pay as it did in 2024. The Committee also approved base salaries for the other NEOs as follows: Mr. Tackett - $643,700; Mr. Harrison - $595,900; Ms. von Muehlen - $508,300; and Mr. Levine - $606,700, in each case effective as of April 14, 2025. The 2025 base salaries approved for these other NEOs were between 7.0% and 10.0% higher than 2024 levels. In September 2025 the Committee approved a base salary of $630,000 for Mr. Levine effective September 29, 2025, 3.8% higher than his previous 2025 level. The approved increase was in consideration of the expansion of his role and his promotion to executive vice president corporate and public affairs, chief legal officer and corporate secretary of Alaska Air Group and Alaska Airlines. The increases to the NEOs' base salaries were approved in consideration of the market review against the new peer group and other above-listed rationale. In 2025 both the CEO's and NEOs' base pay and total target direct compensation were slightly below the peer group median.

  15. Performance-Based Pay (PBP) Short-Term Incentive Pay Plan

    Performance-Based Pay (PBP) Short-Term Incentive Pay Plan The NEOs are eligible to earn annual incentive pay under the PBP Plan, in which all eligible company employees participated in 2025. The PBP Plan is intended to motivate executives and other employees to achieve specific company goals. The Committee aligns the PBP Plan with the Company’s strategic plan by determining a target performance goal for each operational, safety, financial, or strategic metric (outlined in the 2025 Performance-Based Pay Metrics table below) that is consistent with the Company’s strategic plan goals. Target payout opportunities are established for each NEO as a percentage of base salary. These percentages are approved by the Committee after considering market data, performance, tenure, and internal pay parity, among other factors as it deems appropriate. For the NEOs, the 2025 target participation levels are listed in the table below. The Committee approved an increase to Mr. Tackett's participation rate from 95% in 2024 to 100% in 2025 in recognition of his contributions and approved an increase to Mr. Levine's participation rate from 75% to 85% upon his promotion to executive vice president.

  16. 2025 Performance-Based Pay Plan Participation Rates

    Incentive award payments under the PBP Plan range from 0% to 200% of the NEO’s target based on the achievement of performance goals set by the Committee at the beginning of each year. The PBP also includes a margin modifier that can increase the PBP payout based on relative pre-tax margin industry performance as described below. The PBP payout percentage (including the modifier) is capped at 200% of target for executive employees, including the NEOs. For each metric, performance at the target level results in a 100% payout of the target amount for that metric, while the payout percentage would be 200% for performance at or above the maximum level and 25% for performance at the threshold level. The payout percentages are interpolated for performance between the levels identified below, but if performance for a particular metric is below the threshold level, no payment will be made as to that metric. The Committee retains discretion to adjust bonus amounts that would otherwise be paid, though no such discretion was applied for 2025. The long-term success of the Company is highly dependent on running a safe, profitable, sustainable and reliable operation and outperforming the industry. Each of these key strategic objectives is reflected in the metrics of the PBP Plan. For 2025, the PBP Plan metrics for employees were set as follows:

  17. 2025 Performance-Based Pay Metrics

    (1) “Adjusted Pretax Profit” means the net income of Alaska Air Group as computed under GAAP, adjusted for Excluded Items and Alternative Accounting Treatments. “Excluded Items” means (a) income taxes, (b) pretax expense under any Alaska Air Group (or subsidiary) performance-based pay, operational performance rewards, or similar such programs as determined in the discretion of the Committee, and (c) special income or expense items that, in the discretion of the Committee, and (c) special income or expense items that, in the discretion of the Committee, should be excluded because recognizing them would not appropriately serve the goals of the PBP Plan. These may include, without limitation, gain or loss on disposition of capital assets, impairments or other fleet exit costs, expenses from voluntary or involuntary severance programs, significant curtailment gains or losses from retirement plans, the impact of changes in accounting principle, government refunds or assistance and cumulative effect of accounting changes. “Alternative Account Treatments” means expense or income items that, for purposes of calculating Adjusted Pretax Profit, the Company (or any subsidiary) will account for based on non-GAAP methods because, in the discretion of the Committee, using GAAP accounting methods would not appropriately serve the goals of the PBP Plan. These may include, without limitation, fuel hedge accounting on an “as settled” basis. See Appendix A for the calculation of the adjusted pre-tax margin. (2) Synergy capture is calculated by measuring incremental revenue and cost savings that could not have been accessed without the combination of Alaska Airlines and Hawaiian Airlines, and subtracting the value of incremental costs that would not have been incurred absent the combination. The PBP Plan also contained a margin modifier based on the Company's full-year Adjusted Pre-Tax Profit compared to results for corresponding metrics reported by five competitors (Delta, United, American, Southwest and JetBlue). The modifier provides the possibility to increase the payout percentage by 60 points for first place, 40 points for second place and 20 points for third place with no increase if the Company places below third place as compared to the five competitors listed above. The Committee believes profitable growth creates value for all stakeholders. Implementing a profit modifier builds on the Company's baseline profitability threshold, creating further alignment with the Company's long-term financial goals of industry outperformance and to recognize employees for contributing to that success. Ultimately, stronger outperformance allows greater reinvestment into the business to fuel more growth, fosters culture, and provides the foundation for attractive shareholder returns, further solidifying the Company's strong position in the marketplace. As noted above, the PBP Plan's target financial, safety reporting, guest experience and integration-related synergy capture goals are generally consistent with the strategic plan that is approved by the Board. Maximum goals correlate to superior performance, while threshold goals generally correlate to what the Committee believes is an acceptable, but minimal, level of performance. Safety continues to be the Company's top priority, and safety reporting is an essential tool to maintain a safe operation. To ensure the Company's culture of strong safety reporting is preserved throughout the integration with Hawaiian Airlines, the Committee set the percentage payout under the safety metric at 20%. Including a safety metric in this broad-based plan underscores the message that every employee "owns safety." As in prior years, the Committee also included a guest experience goal as a PBP Plan metric for 2025 to align on operational excellence, and for 2025 the Committee also set an integration-related synergy capture goal to motivate every employee to deliver on the financial commitments the Company made to shareholders when it announced its intention to combine with Hawaiian Airlines. The Committee believes that using adjusted non-GAAP measures, as defined in the footnotes to the 2025 Performance-Based Pay Metrics table above, such as Adjusted Pre-Tax Profit, rather than GAAP measures, more closely ties results to elements of performance that can be controlled by the decisions and actions of employees, thereby providing a more direct link between performance and reward. In addition, by removing the short-term impact of certain business decisions (such as the gain or loss on disposition of capital assets), the Committee believes the use of adjusted measures encourages executives to make decisions that are in the best interest of the Company over the long term. The table below presents the actual performance results and payout percentages for the 2025 PBP Plan.

  18. 2025 PBP Pay Calculation

    | PBP Metrics | Actual Performance | Payout % for Metric | Weight | | Payout % | | Profit | 2.80% | —% | 50 | | —% | | Safety | 7.50% | 200.0% | 20 | | 40.00% | | Guest Experience | 7 of 12 Months | 100.0% | 10 | | 10.00% | | Integration-Related Synergy Capture | >$350M | 200.0% | 20 | | 40.00% | | Initial PBP Payout % | | | | | 90.00% | | Margin Modifier Placement | 3rd | | | + | 20.0% | | Total PBP Payout as a % of Target Participation rate | | | | = | 110.00% |

  19. Long-Term Equity-Based Incentive Compensation

    Long-Term Equity-Based Incentive Compensation Long-term equity incentive awards that link executive pay to shareholder value are an important element of the Company’s executive compensation program. Long-term equity incentives that vest over three-year periods are awarded annually, resulting in overlapping vesting periods. As the value of the awards is dependent on the Company's stock price, the awards are designed to further align NEOs’ interests with those of shareholders. In addition, equity awards help attract and retain top-performing executives who fit a team-oriented and performance-driven culture. The Company’s 2025 equity grant structure is described below. Equity Award Guidelines. The Committee considers and generally follows equity grant guidelines that are based on the target total direct compensation levels and pay mix for each NEO described above. Target equity grant date values, when combined with the base salary and annual target incentive opportunity described above, are designed to achieve target total direct compensation for the NEOs at or about the 50th percentile of the peer group data for executives in comparable positions. The Committee may adjust target equity grant date values to the NEOs based on the Committee’s general assessment of: • the individual’s contribution to the success of the Company’s financial performance; • internal pay equity; • the individual’s performance of job responsibilities; and • the accounting impact to the Company and potential dilution effects of the grant. The Committee believes that RSUs and PSUs each provide incentives that are important to the Company’s executive compensation program as a whole. Therefore, the Committee generally awards a mix of these instruments to the NEOs when approving annual equity awards. Timing of Equity Grants. The Committee’s practice has generally been to grant annual equity awards at its first meeting of each fiscal year, which is usually scheduled well in advance. Additionally, the Committee retains discretion to grant equity awards at other times when and as the Committee may determine to be appropriate. The release of material nonpublic information is not taken into account in determining the timing and terms of equity award grants, and the Company does not time the disclosure of material nonpublic information for the purpose of affecting the value of executive compensation. Restricted Stock Units. The Company grants 50% of each NEO’s annual long-term incentive award value in the form of time-based restricted stock units (“RSUs”). If employment requirements are met, the RSUs vest ratably over a three-year period and, upon vesting, are paid in shares of Alaska Air Group common stock. The RSUs provide a long-term retention incentive through the vesting period that requires continued service to the Company and aligns with market practice. The RSUs are also designed to further link executives’ interests with those of Alaska Air Group’s shareholders, as the value of the RSUs is based on the value of Alaska Air Group common stock. The Company does not issue dividend equivalents on unvested RSUs. Performance Stock Units. The Company also grants 50% of each NEO’s annual long-term incentive award value in the form of performance-based stock units (“PSUs”). The PSUs vest only if the Company achieves performance goals established by the Committee for the three-year performance period covered by the award. PSUs also provide a retention incentive as vesting is generally contingent on continued employment through the entire three-year period covered by the award (although all or a portion of the award may remain eligible to vest if the executive’s employment ends in certain circumstances). Like RSUs, the PSUs align the executives’ interests with those of shareholders as their value depends on the value of Alaska Air Group common stock. The Company does not issue dividend equivalents on unvested PSUs. 2025 Annual Equity Awards. For 2025, the target equity grant date value and mix of the long-term incentive awards granted to the NEOs are shown in the table below. The grant values for 2025 were determined based on various factors, such as references to market data, company performance, individual performance, strategic initiatives, internal equity, retention and alignment with shareholders. 2025 Annual Equity Award Target Values. The values in the table below represent the target dollar value of the PSU and RSU awards granted in 2025. The Company converts the target value allocated to each type of award into a number of shares to be subject to the award by dividing the dollar value by an average 30-day trailing closing stock price. The actual grant date fair value of each award as determined for accounting purposes (which are disclosed in the executive compensation tables below) will vary from target award values due to required accounting methodologies, and accordingly, the values in the table below differ from the values reported in the 2025 Summary Compensation Table and the 2025 Grants of Plan-Based Awards Table below. For more information on these awards, see the 2025 Grants of Plan-Based Awards table below.

  20. Annual Equity Target Values of 2025 Awards

    | Name | RSUs (50% of Total Grant) | PSUs (50% of Total Grant) | Total Target Equity Value | | Ben Minicucci | $3,125,000 | $3,125,000 | $6,250,000 | | Shane Tackett | $1,300,000 | $1,300,000 | $2,600,000 | | Andrew Harrison | $1,100,000 | $1,100,000 | $2,200,000 | | Constance von Muehlen | $1,025,000 | $1,025,000 | $2,050,000 | | Kyle Levine | $800,000 | $800,000 | $1,600,000 |

  21. Annual Equity Target Values of 2025 Awards

    PSUs Granted in 2025. For the PSU awards granted to the NEOs in February 2025 with a January 1, 2025 through December 31, 2027 performance period, the vesting is based on the Company's Return on Invested Capital (ROIC) performance. Due to the complex and volatile industry environment along with the ongoing integration with Hawaiian Airlines, the Committee elected to set the ROIC goals for the PSUs annually at the beginning of each calendar year during the three-year performance period. The Committee believes that setting the targets annually is appropriate given the multi-year nature of the integration work with Hawaiian Airlines and the risk of other factors outside the Company's control that materially lowers the Company’s ability to set reliable performance goals. This structure continues to hold NEOs accountable to sustained long-term performance. ROIC targets established for 2025 are set forth in the table below.

  22. 2025 Performance Stock Unit Award Metrics (2025-2027 Performance Period)

    2025 Performance Stock Unit Award Metrics (2025-2027 Performance Period)

  23. 2025 Performance Stock Unit Award Metrics (2025-2027 Performance Period)

    | RETURN ON INVESTED CAPITAL METRICS JANUARY 1, 2025 – DECEMBER 31, 2025 (1) | | | ROIC January 1, 2025 - December 31, 2025 (2) | Percentage of ROIC Stock Units that Vest for 2025 portion of the Performance Period | | 9% and above | 200% | | 8% | 100% | | 7% | 50% | | Below 7% | 0% |

  24. 2025 Performance Stock Unit Award Metrics (2025-2027 Performance Period)

    (1) Payout percentages will be linearly interpolated for performance between the levels identified above. (2) As described above, ROIC metrics for 2026 and 2027 will be set by the Committee at the start of the related fiscal year. ROIC is calculated by dividing the Company's Adjusted Net Operating Profit After Tax (before interest expense on debt and interest implicit in aircraft leases) by the Company's average Total Invested Capital for that year. At the end of the three year performance period, the final results will be calculated using a simple average of the payout percentages achieved in each of the three years to determine the final payout percentage. The percentage of the PSUs that vest ranges from 0% to 200% of the target number of units subject to the award, depending on the achievement of the Company’s goals for the performance period. The Committee retains discretion to reduce vesting percentages. The Company's ROIC for 2025 (the first of the three years under the performance period) was 5.4%, representing a 0% payout for the 2025 performance year. This result, while disappointing, demonstrates the Company's commitment to setting rigorous performance goals even in a challenging operating environment. PSUs Granted Before 2025. The Committee also granted PSUs in 2023 and 2024 with three-year performance periods beginning in January of each respective year. The PSU awards granted in 2023 vested at the end of the January 1, 2023 through December 31, 2025 performance period and were based 80% on the Company’s TSR performance relative to the an airline peer group comprised of Air Canada, American Airlines Group, Delta Air Lines, JetBlue Airways, SkyWest, Southwest Airlines, Spirit Airlines and United Continental Holdings, and 20% on the Company’s progress towards advancing representation goals at the senior leadership level. In February 2026, the Committee approved a payout of these PSUs at a rate of 98.97%. The Company’s TSR performance ranked sixth among the eight peers, resulting in a 90% payout for that metric and 25% of the Company leadership met representation guidelines, exceeding its 23% goal and resulting in a 134.86% payout for that metric. The PSU awards granted in 2024 are scheduled to vest at the end of the January 1, 2024-December 31, 2026 performance period. These PSUs have a structure similar to the PSUs granted in 2025 as described above, with ROIC measured annually during the three-year performance period and the final results calculated using a simple average of the payout percentages achieved in each of the three years to determine the final payout percentage. As previously disclosed, the Company's 2024 ROIC resulted in a 200% payout for that year and the Company's 2025 ROIC resulted in a 0% payout.

  25. Retirement Benefits/Deferred Compensation

    Retirement Benefits/Deferred Compensation The Company provides retirement benefits to the NEOs under the terms of qualified and non-qualified defined-benefit and defined-contribution retirement plans. All eligible employees, including the NEOs, participate in the Company’s 401(k) plan. One NEO participates in the Retirement Plan for Salaried Employees (the Salaried Retirement Plan), a tax-qualified defined benefit plan which was frozen on January 1, 2014 at its then-current benefit levels. The benefits that would otherwise be provided to participants under the Salaried Retirement Plan are required to be limited under the Internal Revenue Code. In light of the freeze on the Company’s Salaried Retirement Plan effective January 1, 2014, all NEOs participate in the Company’s Defined Contribution Officers Supplementary Retirement Plan (DC Supplementary Retirement Plan), which is a nonqualified defined contribution plan. The NEOs are also permitted to elect to defer up to 100% of their annual Performance-Based Pay payments under the Company’s Nonqualified Deferred Compensation Plan. The Company believes that providing deferred compensation opportunities is a cost-effective way to permit executives to receive the tax benefits associated with delaying the income tax event on the compensation deferred. The interest earned on this deferred compensation is similar to what an ordinary investor could earn in the market. Please see the tables under Pension and Other Retirement Plans and 2025 Nonqualified Deferred Compensation and the information following the tables for a description of these plans. Stock Ownership Policy The Committee believes that requiring significant stock ownership by executives further aligns their interests with those of shareholders. Within five years of election or promotion to a position with a greater holding requirement, each executive officer is expected to beneficially own a number of shares of the Company’s common stock with a fair market value equal to or in excess of a specified multiple of the individual’s base salary as follows: five times base salary for the CEO; • three times base salary for executive vice presidents; and • one and a half times base salary for senior vice presidents. Executives are required to retain 50% of any shares of common stock acquired in connection with the vesting of RSUs and PSUs until the holding requirement is reached. Unexercised stock options, unvested RSUs and unvested PSUs do not count toward satisfaction of the ownership requirements. As of December 31, 2025, all NEOs were compliant with the stock ownership policy. Recoupment of Certain Compensation Payments In accordance with SEC and NYSE requirements, the Board has adopted a compensation recovery policy regarding the adjustment or recovery of certain incentive awards or payments made to current or former executive officers in the event the Company is required to prepare an accounting restatement due to material noncompliance with any financial reporting requirement under the securities laws. In general, the policy provides that, unless the costs of recovery would exceed the amount of the compensation to be recovered, the Company must seek to recover compensation that is awarded to an executive officer based on the Company’s attainment of a financial metric during the three-year period prior to the fiscal year in which the restatement occurs, to the extent such compensation exceeds the amount that would have been awarded based on the restated financial results. The policy also provides that in the event of such a restatement, the Committee may, in its discretion, seek recovery of incentive awards or payments made to other employees who participate in its incentive programs and are not current or former executive officers. In addition, the policy provides that the Committee may, in its discretion, direct the Company to seek recovery of payments or awards, or to effect forfeiture of unpaid or unvested payments or awards, if within three years of the payment or award, the Company concludes based on credible evidence that a current or former executive officer, or any other employee who participates in its incentive programs, committed a legal or compliance violation in connection with his or her employment (except in the case of a current or former executive officer, for whom a legal or compliance violation may be a basis for recovery under the policy if the violation causes reputational harm to the Company, even if the violation is not connected to employment duties), including but not limited to sexual misconduct, a substance abuse offense, a violation of the Company’s policies, Code of Conduct and Ethics, or a violation of non-competition, non-solicitation, non-disparagement or confidentiality covenants. Agreements Regarding Change in Control and Termination The Company has change-in-control agreements with the NEOs that provide for severance benefits if the executive’s employment terminates under certain circumstances in connection with a change in control. The Company has entered into change-in-control agreements with these executives because it believes that the occurrence, or potential occurrence, of a change-in-control transaction would create uncertainty and disruption during a critical time for the Company. The payment of cash severance benefits under the agreements is triggered if two conditions are met: (1) the consummation of a change-in-control transaction and (2) actual or constructive termination of employment within a specific period. Once the change-in-control event occurs, the NEO’s severance and other benefits payable under the contract begin to diminish with time so long as the executive’s employment continues, until ultimate expiration of the agreement 36 months later. None of the Company’s change-in-control agreements provide for reimbursement of excise taxes. For more information on these agreements, see Potential Payments Upon Change in Control and Termination below.

  26. Policy with Respect to Section 162(m)

    | Name and Principal Position | Year | Salary ($) | Stock Awards (1)(2) ($) | Option Awards (1) ($) | Non- Equity Incentive Plan Compen- sation (3) ($) | Change in Pension Value and Nonqualified Deferred Compensation Earnings (4) ($) | All Other Compen- sation (5) ($) | Total ($) | | Ben Minicucci | 2025 | 847,692 | 6,769,222 | — | 1,632,721 | 145,411 | 509,293 | 9,904,339 | | CEO | 2024 | 705,385 | 5,155,622 | — | 2,469,715 | — | 315,261 | 8,645,983 | | Alaska Air Group & Alaska Airlines | 2023 | 637,692 | 7,969,932 | — | 1,224,388 | 94,596 | 386,446 | 10,313,054 | | Shane Tackett | 2025 | 625,714 | 2,816,382 | — | 689,198 | 52,092 | 329,793 | 4,513,179 | | EVP Finance & CFO | 2024 | 577,446 | 2,319,878 | — | 1,098,017 | — | 225,481 | 4,220,822 | | Alaska Air Group & Alaska Airlines | 2023 | 552,462 | 4,011,210 | — | 672,243 | 91,725 | 297,066 | 5,624,706 | | Andrew Harrison | 2025 | 583,888 | 2,382,196 | — | 611,076 | 253,886 | 353,603 | 4,184,649 | | EVP & CCO | 2024 | 551,085 | 2,010,512 | — | 1,047,930 | 18,572 | 248,959 | 3,877,058 | | Alaska Airlines | 2023 | 530,923 | 2,915,973 | — | 646,073 | 100,332 | 379,649 | 4,572,950 | | Constance von Muhelen | 2025 | 498,019 | 2,220,468 | — | 521,343 | 69,961 | 170,757 | 3,480,548 | | EVP & Advisor to COO | 2024 | 465,769 | 2,010,512 | — | 885,830 | — | 136,864 | 3,498,975 | | Alaska Airlines | 2023 | 438,908 | 2,993,735 | 404,923 | 534,270 | 32,823 | 173,348 | 4,578,007 | | Kyle Levine | 2025 | 599,075 | 1,656,333 | — | 511,143 | 69,370 | 310,864 | 3,146,785 | | EVP Corporate & Public Affairs, Chief Legal Officer & Corporate Secretary | 2024 | 552,277 | 1,340,340 | — | 829,284 | — | 168,679 | 2,890,580 | | Alaska Air Group & Alaska Airlines | 2023 | 494,292 | 2,350,784 | 102,803 | 475,125 | 19,687 | 211,946 | 3,654,637 |

  27. Pay vs. Performance Table Discussion and Analysis

    Pay vs. Performance Table Discussion and Analysis In accordance with Item 402(v) of Regulation S-K, the Company provides the following information regarding the relationship between the total compensation of the principal executive officer (PEO) and other named executive officers (referred to as Non-PEO NEOs) and the Company's financial performance for the fiscal years shown in the table. For further information on the Company's pay-for-performance philosophy and how executive compensation aligns with the Company’s performance, refer to the Compensation Discussion and Analysis section of this proxy statement.

  28. Pay vs. Performance Table

    Pay vs. Performance Table

  29. Pay vs. Performance Table

    | | | | | | | | Value of Initial Fixed $100 Investment Based On: | | | | | Year | Summary Compensation Table Total for PEO #1(1&2) | Compensation Actually Paid to PEO #1(1,3&4) | Summary Compensation Table Total for PEO #2(1&2) | Compensation Actually Paid to PEO #2(1,3&4) | Average Summary Compensation Table Total for Non-PEO NEOs(5) | Average Compensation Actually Paid to Non-PEO NEOs(6) | Total Shareholder Return(7) | Peer Group Total Shareholder Return(8) | Net Income (millions)(9) | Company Selected Measure (Adjusted Pre-Tax Margin)(10) | | 2025 | N/A | $0 | $9,904,339 | ($1,214,987) | $3,831,290 | ($152,330) | $96.73 | $84.59 | $293 | 2.80% | | 2024 | N/A | $0 | $8,645,983 | $21,207,301 | $3,621,859 | $8,253,045 | $124.52 | $80.73 | $395 | 7.10% | | 2023 | N/A | $0 | $10,313,054 | $7,007,555 | $4,607,575 | $3,478,775 | $75.13 | $81.54 | $235 | 7.50% | | 2022 | N/A | $0 | $6,487,981 | $3,004,559 | $3,000,762 | $1,834,114 | $82.58 | $63.58 | $58 | 7.60% | | 2021 | $873,333 | $1,027,753 | $5,130,162 | $2,381,082 | $2,442,646 | $1,254,528 | $100.19 | $98.26 | $478 | -5.60% |

  30. Pay vs. Performance Table

    (1) PEOs and NEOs included in these columns reflect the following:

  31. Pay vs. Performance Table

    | Year | PEO #1 | PEO #2 | Non-PEO NEOs | | 2025 | | Mr. Minicucci | Mr. Tackett, Mr. Harrison, Ms. von Muehlen, Mr. Levine | | 2024 | | Mr. Minicucci | Mr. Tackett, Mr. Harrison, Ms. von Muehlen, Mr. Levine | | 2023 | | Mr. Minicucci | Mr. Tackett, Mr. Harrison, Ms. Von Muehlen, Mr. Levine | | 2022 | | Mr. Minicucci | Mr. Tackett, Mr. Harrison, Ms. Schneider, Ms. Von Muehlen | | 2021 | Mr. Tilden | Mr. Minicucci | Mr. Tackett, Mr. Harrison, Ms. Schneider, Ms. von Muehlen |

  32. Pay vs. Performance Table

    (2) Amounts reflect the total compensation for PEOs, as reported in the Summary Compensation Table for the applicable fiscal year. (3) The following table details the total equity award adjustments for each applicable year, including the amounts added (or subtracted, as applicable) for each PEO and non-PEO NEOs, as computed in accordance with Item 402(v). In general, the adjustments for equity awards provided in Item 402(v) are as follows: • Subtract the amounts reported in the “Stock Awards” and “Option Awards” columns of the Summary Compensation Table for the applicable fiscal year, • Add the fiscal year-end value of option and stock awards granted in the covered fiscal year which were outstanding and unvested at the end of the covered fiscal year, • Add the change in value (which may be a negative number) as of the end of the covered fiscal year as compared to the value at the end of the prior fiscal year for option and stock awards which were granted in prior fiscal years and were outstanding and unvested at the end of the covered fiscal year, • Add the vesting date value of option and stock awards which were granted and vested during the same covered fiscal year, Add the change in value (which may be a negative number) as of the vesting date as compared to the value at the end of the prior fiscal year for option and stock awards which were granted in prior fiscal years and vested in the covered fiscal year, Subtract as to any option and stock awards which were granted in prior fiscal years and were forfeited during the covered fiscal year, the value of such awards as of the end of the prior fiscal year, Plus the dollar value of any dividends or other earnings paid during the covered fiscal year on outstanding and unvested awards. • Plus, as to any option or stock award that was materially modified during the covered fiscal year, the amount by which the value of the award as of the date of the modification exceeds the value of the original award on the modification date (none of the option or stock awards held by the named executive officers were materially modified during the fiscal years covered by the table). In making each of these adjustments, the “value” of an option or stock award is the fair value of the award on the applicable date determined in accordance with FASB ASC Topic 718 using the valuation assumptions that were then used to calculate the fair value of equity awards. For more information on the valuation of equity awards, please see the notes to the Company's financial statements that appear in the Company's Annual Report on Form 10-K each fiscal year and the footnotes to the Summary Compensation Table that appears in the annual Proxy Statement.

  33. Pay vs. Performance Table

    | | PEO 2: Mr. Minicucci | NEO Average | | | 2025 | 2025 | | Summary Compensation Table Total | $9,904,339 | $3,831,290 | | Less: Grant Date Fair Value of Equity Awards Granted in Fiscal Year (a) | $(6,769,222) | $(2,268,845) | | Less: Change in Pension Value (b) | $(145,411) | $(111,327) | | Add: Pension Service Cost and Associated Prior Service Cost (c) | $0 | $0 | | Add: Fair Value at Fiscal Year-End of Outstanding and Unvested Equity Awards Granted in the Fiscal Year (d) | $3,902,686 | $1,311,408 | | Add/(Less): Change in Fair Value of Outstanding and Unvested Equity Awards Granted in Prior Fiscal Years (d) | $(6,703,901) | $(2,508,686) | | Add: Fair Value at Vesting of Equity Awards Granted and Vested in the Fiscal Year | $0 | $0 | | Add/(Less): Change in Fair Value as of the Vesting Date of Equity Awards Granted in Prior Fiscal Years that Vested in the Fiscal Year | $(1,403,479) | $(406,170) | | Less: Fair Value as of the Prior Fiscal Year End of Equity Awards Granted in Prior Fiscal Years that Failed to Meet Vesting Conditions in the Fiscal Year | $0 | $0 | | Add: Value of Dividends or Other Earnings Paid on Equity Awards Not Otherwise Reflected in Total Compensation | $0 | $0 | | Compensation Actually Paid | $(1,214,987) | $(152,330) |

  34. Pay vs. Performance Table

    (a) Amounts include the grant date fair value of equity awards granted in the year. More detail on equity awards is available in the CD&A Section above. (b) Amounts reflect the changes in the actuarial present value of pension benefits, as reported in the Summary Compensation Table. (c) As described in the Retirement Benefits/Deferred Compensation section above, the tax-qualified defined benefit plan was frozen on January 1, 2014 at its then-current benefit levels and no associated service costs have been incurred since that date. Amounts reflect $0 of the actuarial present value of each named executive officer’s benefit under all such plans attributable to services rendered during the covered fiscal year, and $0 of the entire cost of benefits granted (or credit for benefits reduced) in the plan amendment (or initiation) during the covered fiscal year that are attributed by the benefit formula to services rendered in periods prior to the amendment. (d) Amounts include year-end fair value of equity awards granted in the year. More details on equity awards are available in the CD&A Section. Amounts reflect the “compensation actually paid” (CAP) to PEOs, as computed in accordance with Item 402(v) of SEC Regulation S-K. As provided in Item 402(v), the adjustments in the table below were made to each PEO’s total compensation reported in the Summary Compensation Table for each year to determine the compensation actually paid to each PEO for purposes of this disclosure. Amounts reflect the average compensation for non-PEO NEOs, as reported in the Summary Compensation Table for the applicable fiscal year. (6) Amounts reflect the average CAP to Non-PEO NEOs, as computed in accordance with Item 402(v) of SEC Regulation S-K. As provided in Item 402(v), the adjustments in the table below were made to average the Non-PEO NEO's total compensation reported in the Summary Compensation Table for each year to determine the average compensation actually paid to Non-PEOs for purposes of this disclosure. (7) The amounts in this column assume the investment of $100 in December 31, 2020 on Alaska Air Group’s common shares traded on the NYSE and the reinvestment of all dividends since that date. (8) The amounts in this column assume the investment of $100 on December 31, 2020 in the NYSE ARCA Airline Index and the reinvestment of all dividends since that date. (9) Amounts reflect Alaska Air Group’s net income as reported in the Company's audited financial statements for the applicable year. (10) Amounts reflect Alaska Air Group’s adjusted pre-tax margin for each fiscal year. While the Company uses numerous financial and non-financial performance measures to evaluate performance under its compensation programs, adjusted pre-tax margin is the financial performance measure that, in Alaska Air Group’s assessment, represents the most important performance measure (that is not otherwise required to be disclosed in the table) used to link compensation actually paid to the NEOs to company performance for the most recently completed fiscal year. See Appendix A for the calculation of adjusted pre-tax margin. The assumptions used in calculating the fair value of the equity awards did not differ in any material respect from the assumptions used to calculate the grant date fair value of the awards as reported in the Summary Compensation Table, except that the fair value calculations of (i) the unvested options used an estimated term between 0.6 years and 5.6 years in 2025, as compared to an estimated term of 5.6 years used to calculate the grant date fair value of such awards, and (ii) the PSUs assumed payout multipliers at current expectations, which range from 0% to 100% across different grant years and metrics, in each case as compared to the grant date fair value calculations which assumed a payout at target.

  35. Pay vs. Performance Table Discussion and Analysis

    Pay vs. Performance Table Discussion and Analysis In accordance with Item 402(v) requirements, the Company is providing the following charts to describe the relationships between information presented in the Pay vs. Performance table. The following charts show the relationship between the compensation actually paid to NEOs and the Company's financial performance, in each case presented in the tables below: 1) TSR of both Alaska Air Group and the NYSE ARCA Airline Index; 2) Alaska Air Group’s Net Income; and 3) Alaska Air Group’s Adjusted Pre-Tax Margin.

  36. Pay vs. Performance Table Discussion and Analysis

    | AUDIT COMMITTEE MATTERS |

  37. Pay vs. Performance Table Discussion and Analysis

    Proposal 3: Ratification of the Appointment of the Company’s Independent Registered Public Accountants The Audit Committee has selected KPMG LLP (KPMG) as the Company’s independent registered public accountants (the independent accountants) for fiscal year 2026, and the Board is asking stockholders to ratify that selection. Although current laws, rules, and regulations, as well as the charter of the Audit Committee, require the Audit Committee to engage, retain, and supervise the independent accountants, the Board considers the selection of the independent accountants to be an important matter of stockholder concern and is submitting the selection of KPMG for ratification by stockholders as a matter of good corporate practice. The affirmative vote of holders of a majority of the shares of common stock represented at the Annual Meeting, in person and by proxy, and entitled to vote on the matter is required to ratify the selection of KPMG as the Company’s independent accountants for the current fiscal year. THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE RATIFICATION OF THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS. Independent Registered Public Accountants