LON R. GREENBERG
Chairman andChief Executive Officer
December 16, 2014
Dear Shareholder,
On behalf of our entire Board of Directors, I cordially invite you to attend our Annual Meeting of Shareholders on Thursday, January 19, 2012.29, 2015. At the meeting, we will review UGI’s performance for Fiscal 2011the 2014 fiscal year and our expectations for the future.
I would like to take this opportunity to remind you that your vote is important. On December 9, 2011,16, 2014, we mailed our shareholders a notice containing instructions on how to access our 20112014 proxy statement and annual report and vote online. Please read the proxy materials and take a moment now to vote online or by telephone as described in the proxy voting instructions. Of course, if you received these proxy materials by mail, you may also vote by completing the proxy card and returning it by mail.
I look forward to seeing you on January 19th29th and addressing your questions and comments.
 |
Sincerely,
Lon R. Greenberg
December 16, 2014
NOTICEOF
ANNUAL MEETINGOF SHAREHOLDERS
The Annual Meeting of Shareholders of UGI Corporation will be held on Thursday, January 19, 2012,29, 2015, at 10:00 a.m., at The Desmond Hotel and Conference Center, Ballrooms A and B, One Liberty Boulevard, Malvern, Pennsylvania. Shareholders will consider and take action on the following matters:
1. election of tennine directors to serve until the next annual meeting of Shareholders;
2. a non-binding advisory vote on a resolution to approve UGI Corporation’s executive compensation;
3. a non-binding advisory vote to determine the frequency with which shareholders will be asked to give an advisory vote on executive compensation;
4. transaction of any other business that is properly raised at the meeting.
Monica M. Gaudiosi
Corporate Secretary
|
This Proxy Statement and the Company’s 20112014 Annual Report are available atwww.ugicorp.com.
This summary highlights information contained elsewhere in this Proxy Statement. The summary does not contain all of the information that you should consider. Please read the entire Proxy Statement carefully before voting.
Annual Meeting of Shareholders
Time and Date: | 10:00 a.m. (Eastern Time), January 29, 2015 | |||
Place: | ||||
| Center, Ballrooms A & B One Liberty Boulevard, Malvern, Pennsylvania | ||||
Record Date: | November 12, 2014 | |||
Voting: | Shareholders as of the close of business on the record date are entitled to vote. Each share of common stock is entitled to one vote for each matter to be voted on. | |||
Voting Matters and Board Recommendations
| 1. | Election of nine directors; |
| 2. | Non-binding advisory vote on a resolution to approve the compensation of our named executive officers; and |
| 3. | Ratification of Ernst & Young LLP as our independent registered public accounting firm for Fiscal 2015. |
| UGI Corporation’s Board of Directors recommends that you voteFORthe election of each of the director nominees andFORProposals 2 and 3. |
Executive Compensation Highlights
Corporate Governance Highlights
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Advisory Vote to Approve Named Executive Officer Compensation
We are asking shareholders to approve, on an advisory basis, UGI CORPORATION460 North Gulph RoadKingCorporation’s executive compensation, including our executive compensation policies and practices and the compensation of Prussia, Pennsylvania 19406
At the 2014 Annual Meeting, Information
This result demonstrated clear support for our executive compensation policies and practices and our alignment of pay and performance.
| The Board of Directors recommends aFOR vote because it believes that the compensation policies and practices are effective in achieving UGI Corporation’s goals of paying for performance and aligning the executives’ long- term interests with those of our shareholders. |
Objectives and Components of our Compensation Program
The compensation program for our named executive officers is designed to provide a competitive level of total compensation necessary to attract and retain talented and experienced executives. Additionally, our compensation program is intended to motivate and encourage our executives to contribute to our success and reward our executives for leadership excellence and performance that promotes sustainable growth in shareholder value.
In Fiscal 2014, the components of our compensation program included salary, annual
bonus awards, a discretionary bonus award to one named executive officer, long-term incentive compensation (performance unit awards and UGI Corporation stock option grants), a discretionary restricted unit award to one named executive officer, limited perquisites, retirement benefits and other benefits, all as described in greater detail in the Compensation Discussion and Analysis of this Proxy Statement. We believe that the elements of our compensation program are essential components of a balanced and competitive compensation program to support our annual and long-term goals.
Pay for Performance
Our executive compensation program allows the Compensation and Management Development Committee and the Board to determine pay based on a comprehensive view of quantitative and qualitative factors designed to enhance shareholder value and align the long-term interests of executives and shareholders. For example, for the 2011-2013 performance period, UGI Corporation’s total shareholder return compared to its peer group was in the 50th percentile and Mr. Walsh received a performance unit payout of $1,250,970 during Fiscal 2014. For the 2010-2012 performance period, UGI Corporation’s total shareholder return compared to its peer group was in the 42nd percentile and Mr. Walsh received a performance unit payout of $597,764 during the 2013 fiscal year. For the 2009-2011 performance period, UGI Corporation’s total shareholder return compared to its peer group was in the 30th percentile and resulted in no payout during the 2012 fiscal year. For additional information on the alignment between our financial results and executive officer compensation, see Compensation Discussion and Analysis.
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Questions and Answers About Proxy Materials, Annual Meeting and Voting
This proxy statement contains information related to the Annual Meeting of Shareholders of UGI Corporation (the “Company”) to be held on Thursday, January 19, 2012,29, 2015, beginning at 10:00 a.m., at The Desmond Hotel and Conference Center, Ballrooms A and B, One Liberty Boulevard, Malvern, Pennsylvania and at any postponements or adjournments thereof. Directions to The Desmond Hotel and Conference Center appear on page 79.61. This proxy statement was prepared under the direction of the Company’s Board of Directors to solicit your proxy for use at the Annual Meeting. It was made available to shareholders on or about December 9, 2011.
Why did I receive a notice in the mail regarding the Internet availability of proxy materials instead of printed proxy materials?
The Company has elected to provide access to the proxy materials over the Internet. We believe that this initiative enables the Company to provide proxy materials to shareholders more quickly, reducereduces the impact of our Annual Meeting on the environment, and reducereduces costs.
Who is entitled to vote?
Shareholders of record of our common stock at the close of business on November 14, 201112, 2014 are entitled to vote at the Annual Meeting, or any postponement or adjournment of the meeting scheduled in accordance with Pennsylvania law. Each shareholder has one vote per share on all matters to be voted on. On November 14, 2011,12, 2014, there were 115,458,302172,498,572 shares of common stock outstanding.
What am I voting on?
You will be asked to elect tennine nominees to serve on the Company’s Board of Directors, to provide an advisory vote on the Company’s executive compensation and on the frequency of future advisory votes on executive compensation and to ratify the appointment of our independent registered public accounting firm for Fiscal 2012.the fiscal year ending September 30, 2015 and any other business properly coming before the meeting. The Board of Directors is not aware of any other matters to be presented for action at the meeting.
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You may vote in one of three ways:
-2-Over the Internet
If your shares are registered in your name: Vote your shares over the Internet by accessing the Computershare proxy online voting website at: www.envisionreports.com/UGI and following the on-screen instructions.
You will need the control number that appears on your Notice of Availability of Proxy Materials when you access the web page.
If your shares are held in the name of a broker, bank or other nominee: Vote your shares over the Internet by following the voting instructions that you receive from such broker, bank or other nominee.
By Telephone
If your shares are registered in your name: Vote your shares over the telephone by accessing the telephone voting system toll-free at 800-652-8683 and following the telephone voting instructions. The telephone instructions will lead you through the voting process. You will need the control number that appears on your Notice of Availability of Proxy Materials when you call.
If your shares are held in the name of a broker, bank or other nominee: Vote your shares over the telephone by following the voting instructions you receive from such broker, bank or other nominee.
By Mail
If you received these annual meeting materials by mail: Vote by signing and dating the proxy card(s) and returning the card(s) in the prepaid envelope. Also, you can vote online or by using a toll-free telephone number. Instructions about these ways to vote appear on the proxy card. If you vote by telephone, please have your proxy card and control number available.
How can I vote my shares held in the Company’s Employee Savings Plans?
You can instruct the trustee for the Company’s Employee Savings Plans to vote the shares of stock that are allocated to your account in the UGI Stock Fund. If you do not vote your shares, the trustee
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will vote them in proportion to those shares for which the trustee has received voting instructions from participants. Likewise, the trustee will vote shares held by the trust that have not been allocated to any account in the same manner.
How can I change my vote?
You can revoke your proxy at any time before it is voted. Proxies are voted at the Annual Meeting. If you are a shareholder of record and you returned a paper proxy card, you can write to the Company’s Corporate Secretary at our principal offices, 460 North Gulph Road, King of Prussia, Pennsylvania 19406, stating that you wish to revoke your proxy and that you need another proxy card. Alternatively, you can vote again, either over the Internet or by telephone. If you hold your shares through a broker, bank or other nominee, you can revoke your proxy by contacting the broker, bank or other nominee and following their procedure for revocation. If you are a shareholder of record and you attend the meeting, you may vote by ballot, which will cancel your previous proxy vote. If your shares are held through a broker, bank or other nominee, and you wish to vote by ballot at the meeting, you will need to contact your bank, broker or other nominee to obtain a legal proxy form that you must bring with you to the meeting to exchange for a ballot. Your last vote is the vote that will be counted.
What is a quorum?
A quorum of the holders of the outstanding shares must be present for the Annual Meeting to be held. A “quorum” is the presence at the meeting, in person or represented by proxy, of the holders of a majority of the outstanding shares entitled to vote.
How are votes, abstentions and broker non-votes counted?
Abstentions are counted for purposes of determining the presence or absence of a quorum, but are not considered a vote cast under Pennsylvania law.
A broker non-vote occurs when a broker, bank or other nominee holding shares on your behalf does not receive voting instructions from you. If that happens, the broker, bank or other nominee may vote those shares only on matters deemed “routine” by the New York Stock Exchange, such asExchange. On non-routine matters, the ratification ofbroker, bank or other nominee cannot
vote those shares unless they receive voting instructions from the appointment of the Company’s independent registered public accounting firm.beneficial owner. A “broker non-vote” occurs when a broker has not received voting instructions and either declines to exercise its discretionary authority to vote on routine matters or is barred from doing so because the matter is non-routine. Broker non-votes are counted to determine if a quorum is present, but are not considered a vote cast under Pennsylvania law.
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What vote is required to approve each item?
The Director nominees will be elected by a pluralitymajority of the votes cast at the Annual Meeting.
The approval, by advisory vote, of UGI Corporation’sthe Company’s executive compensation requires the affirmative vote of a majority of the shares present in person or by proxy and entitled to vote at the 20122015 Annual Meeting. This vote is advisory in nature and therefore not binding on UGI Corporation, the Board of Directors or the Compensation and Management Development Committee. However, our Board of Directors and the Compensation and Management Development Committee value the opinions of the Company’s shareholders and expect towill consider the outcome of this vote in their future deliberations on the Company’s executive compensation programs.
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The ratification of the appointment of PricewaterhouseCoopersErnst & Young LLP as our independent registered public accounting firm for Fiscal 20122015 requires the affirmative vote of a majority of the votes cast at the meeting to be approved.
Who will count the vote?
Computershare Inc., our Transfer Agent, will tabulate the votes cast by proxy or in person at the Annual Meeting.
What are the deadlines for Shareholders’Shareholder proposals for next year’s Annual Meeting?
Shareholders may submit proposals on matters appropriate for shareholder action as follows:
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How much did this proxy solicitation cost?
The Company has engaged Georgeson Inc. to solicit proxies for the Company for a fee of $7,500 plus reasonable expenses for additional services. We also reimburse banks, brokerage firms and other institutions, nominees, custodians and fiduciaries for their reasonable expenses for sending proxy materials to beneficial owners and obtaining their voting instructions. Certain Directors, officers and regular employees of the Company and its subsidiaries may solicit proxies personally or by telephone or facsimile without additional compensation.
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| Number of | ||||||||||||||||||||
| Number of UGI | Exercisable | Number of | AmeriGas | |||||||||||||||||
| Number | Stock Units | Options | AmeriGas | Partners, L.P. | ||||||||||||||||
| of Shares of UGI | Held Under | For UGI | Partners, L.P. | Phantom | ||||||||||||||||
| Name | Common Stock(1) | 2004 Plan(2) | Common Stock | Common Units | Units(3) | |||||||||||||||
| Stephen D. Ban | 16,496 | 63,438 | 80,000 | 0 | 1,014 | |||||||||||||||
| Eugene V. N. Bissell | 67,297 | (4) | 0 | 211,666 | 60,800 | (4) | 0 | |||||||||||||
| Richard W. Gochnauer | 0 | 2,550 | 8,500 | 0 | 0 | |||||||||||||||
| Richard C. Gozon | 32,608 | 99,998 | (5) | 59,500 | 5,659 | 0 | ||||||||||||||
| Lon R. Greenberg | 405,872 | (6) | 0 | 1,495,000 | 11,000 | 0 | ||||||||||||||
| Ernest E. Jones | 3,618 | 29,350 | 92,000 | 0 | 0 | |||||||||||||||
| Frank S. Hermance | 30,000 | (7) | 1,275 | 0 | 0 | 0 | ||||||||||||||
| Peter Kelly | 56,406 | (8) | 0 | 0 | 0 | 0 | ||||||||||||||
| Robert C. Flexon | 5,000 | 0 | 0 | 0 | 0 | |||||||||||||||
| Robert H. Knauss | 10,105 | 12,000 | 90,000 | 14,108 | 0 | |||||||||||||||
| Anne Pol | 3,021 | 64,860 | 74,000 | 0 | 0 | |||||||||||||||
| M. Shawn Puccio | 3,550 | 7,889 | 25,500 | 0 | 0 | |||||||||||||||
| Marvin O. Schlanger | 9,724 | (9) | 53,248 | 80,000 | 1,000 | (9) | 1,014 | |||||||||||||
| Francois Varagne | 42,239 | 0 | 109,000 | 0 | 0 | |||||||||||||||
| Roger B. Vincent | 16,504 | 16,505 | 51,000 | 6,000 | 0 | |||||||||||||||
| John L. Walsh | 126,253 | (10) | 0 | 535,000 | 7,000 | (10) | 0 | |||||||||||||
| Directors and executive officers as a group (19 persons) | 902,897 | 351,113 | 3,076,332 | 105,567 | 2,028 | |||||||||||||||
| NOMINEES |
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| Title of | Name and Address of | Amount and Nature of | Percent of | |||||||
| Class | Beneficial Owner | Beneficial Ownership | Class(1) | |||||||
| Common Stock | Wellington Management Company, LLP 280 Congress Street Boston, MA 02210 | 9,161,365 | (2) | 7.93 | % | |||||
| Common Stock | State Street Corporation One Lincoln Street Boston, MA 02111 | 6,992,022 | (3) | 6.06 | % | |||||
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Information about Director-Nominees
Biographical information, including business experience, and director positions with other public companies currently held, or held at any time during the last five years, is a nomineeincluded below for each of the first time.
The Board of Directors recommends that you vote “FOR” the election of each of the nine nominees for director.
| RICHARD W. GOCHNAUER Retired Chief Executive Officer, United Stationers, Inc. Director since 2011 Age 65 Member, Audit Committee Member, Corporate Governance Committee | |
Mr. Gochnauer retired in May 2011 as Chief Executive Officer and Director of the Technology Transfer DivisionUnited Stationers Inc. (a wholesale distributor of the Argonne National Laboratory (a science-based Department of Energy laboratory dedicatedbusiness products) (2002 to advancing the frontiers of science in energy, environment, biosciences and materials) in 2010, having served in such role since 2001.2011). He previously served as President and Chief ExecutiveOperating Officer and Vice Chairman and President, International, of the Gas Research Institute (gasGolden State Foods Corporation (a food service industry research and development institute funded by distributors, transporters, and producers of natural gas) (1987supplier) (1994 to 1999)2002). He also served as Executive Vice President. Prior to joining the Gas Research Institute in 1981, he was Vice President, Research and Development and Quality Control of Bituminous Materials, Inc. Dr. BanMr. Gochnauer also serves as a Director of AmerisourceBergen Corporation (a wholesale distributor of business products in the U.S. and internationally), Golden State Foods Corporation (a diversified supplier to the foodservice industry), and UGI Utilities, Inc., AmeriGas Propane, Inc.a subsidiary of the Company.
Mr. Gochnauer’s qualifications to serve as director include his extensive senior management experience as Chief Executive Officer of a large public company and Energen Corporation.
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| LON R. GREENBERG Non-Executive Chairman of the Board and Former Chief Executive Officer Director since 1994 Age 64 Member, Executive Committee | |
Mr. Greenberg has been Non-Executive Chairman of the Board of Directors of UGI since 1996his April 2013 retirement as Chairman (a position he had held since 1996) and Chief Executive Officer (a position he had held since 1995.1995). He was formerly President (1994 to 2005), Vice Chairman of the Board (1995 to 1996), and Senior Vice President —– Legal and Corporate Development (1989 to 1994). Mr. Greenberg also serves as a Director and Non-Executive Chairman of AmeriGas Propane, Inc. and UGI Utilities, Inc., AmeriGas Propane,both of which are subsidiaries of UGI Corporation, and as a Director of Ameriprise Financial, Inc., AmerisourceBergen Corporation and Aqua America, Inc.
Mr. Greenberg’s qualifications to serve as a director include his executive leadership, and Ameriprise Financial, Inc.
| FRANK S. HERMANCE Chairman and CEO, AMETEK, Inc. Director since 2011 Age 65 Chair, Safety, Environmental and Regulatory Compliance Committee Member, Compensation and Management Development Committee | |
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as a Director
Mr. Hermance’s qualifications to serve as a director include his extensive senior management experience in the roles of Chairman, Chief Executive Officer, President and Chief Operating Officer of Trex Enterprises Corporation (a high technology research and development company), a position she had held since 2001. She previously served as Senior Vice President of Thermo Electron Corporation (an environmental monitoring and analytical instruments company and a major producer of recycling equipment, biomedical products and alternative energy systems) (1998 to 2001), and Vice President (1996 to 1998). Mrs. Pollarge global public company. Mr. Hermance also served as President of Pitney Bowes Shipping and Weighing Systems Division, a business unit of Pitney Bowes Inc. (mailing and related business equipment) (1993 to 1996); Vice President of New Product Programsprovides relevant experience in the Mailing Systems Divisionareas of Pitney Bowes Inc. (1991 to 1993)corporate governance, mergers and Vice Presidentacquisitions, human resources management, logistics, distribution, risk management and executive compensation. As an executive of Manufacturing Operations ina company with global operations, Mr. Hermance also provides the Mailing Systems Division of Pitney Bowes Inc. (1990 to 1991). Mrs. Pol also serves as a Director of UGI Utilities, Inc.
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 | ERNEST E. JONES President, EJones Consulting, LLC and Former President and CEO, Philadelphia Workforce Development Corp. Director since 2002 Age 70 Chair, Corporate Governance Committee Member, Compensation and Management Development Committee | |
Mr. Jones’ qualifications to serve as a director include his extensive experience managing government and non-profit organizations as Chief Executive Officer, his public and private company directorship experience and his insight into workforce, regulatory, banking and legal issues. Mr. Jones possesses a critical understanding of the Company’s business operations, strategic growth opportunities, and corporate governance matters.
| ANNE POL Retired President and Chief Operating Officer, Trex Enterprises Corp. Director 1993 through 1997 and since 1999 Age 67 Member, Compensation and Management Development Committee Member, Safety, Environmental and Regulatory Compliance Committee | |
Mrs. Pol retired in 2009.
Mrs. Pol’s qualifications to 2010). Mr. Vincent serves as Chairman of the Board of Trustees of the ING Unified Funds andserve as a Director of UGI Utilities, Inc. He previously serveddirector include her strategic planning, business development and technology experience as a Directorsenior-level executive with a diversified high-technology company. Mrs. Pol also possesses an important understanding of, AmeriGas Propane, Inc.,and extensive experience in, the general partnerareas of AmeriGas Partners, L.P., ending in 2006.
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| M. SHAWN PUCCIO Senior Vice President, Finance, Saint-Gobain Corporation Director since 2009 Age 52 Member, Audit Committee Member, Safety, Environmental and Regulatory Compliance Committee | |
Ms. Puccio’s qualifications to serve as a director include her senior financial executive management experience with a global company and her extensive public accounting knowledge and experience. Her education (Ms. Puccio has a bachelor’s degree in accounting from Marquette University and a Master of Eastern Pennsylvania.
| MARVIN O. SCHLANGER Principal, Cherry Hill Chemical Investments, L.L.C. Director since 1998 Age 66 Presiding Director Chair, Compensation and Management Development Committee Chair, Executive Committee Member, Corporate Governance Committee | |
Mr. Gochnauer retiredSchlanger is a Principal in May 2011the firm of Cherry Hill Chemical Investments, L.L.C. (a management services and capital firm for chemical and allied industries) (since 1998). Mr. Schlanger previously served as Chief Executive Officer of CEVA Holdings BV and CEVA Holdings, LLC, an international logistics supplier (2012 to 2013). Mr. Schlanger is currently a Directordirector of United StationersAmeriGas Propane, Inc. (a wholesale distributor, and UGI Utilities, Inc., both of which are subsidiaries of UGI Corporation. He is also a director of Taminco Global Chemical Holdings, LLP, an integrated producer of alkylamines and alkylamine derivatives, CEVA Logistics B.V. and CEVA Holdings, LLC, where he serves as chairman, and Momentive Specialty Chemical Holdings, LLC. Mr. Schlanger was previously a director of LyondellBassell Industries (until 2013) and Hexion Specialty Chemicals Inc., now known as Momentive Specialty Chemicals Inc. (until 2010).
Mr. Schlanger’s qualifications to serve as a director include his senior management, strategic planning, business products) (2002 to 2011). He previously serveddevelopment, risk management, and general operations experience throughout his career as President andChief Executive Officer, Chief Operating Officer, and Vice ChairmanChief Financial Officer of Arco Chemical Company, a large public company. As an executive having worked for a company with global operations, Mr. Schlanger also provides the Board with international experience. The Board also considered Mr. Schlanger’s experience serving as chairman, director and committee member on the boards of directors of large public and private international companies, including his experience serving on boards of directors of public companies as a result of being nominated by a major shareholder.
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| ROGER B. VINCENT Retired President, Springwell Corporation Director since 2006 Age 69 Chair, Audit Committee Member, Executive Committee | |
Mr. Vincent retired in 2011 from his position as President International, of Golden State FoodsSpringwell Corporation, (a food service industry supplier) (1994 to 2002).a corporate finance advisory firm he founded in 1989. Prior to that,1989, Mr. Gochnauer servedVincent held various positions at Bankers Trust Company, including managing director. Mr. Vincent serves as Executive Vice PresidentTrustee and Former Chairman of the Dial Corporation, with responsibility for its householdBoard of the VOYA Funds and laundry consumer products businesses. Mr. Gochnauer also serves as a Director of UGI Utilities, Inc., AmerisourceBergen Corporationa subsidiary of the Company. He previously served as a Director of AmeriGas Propane, Inc., a subsidiary of the Company, from 1998 to 2006.
Mr. Vincent’s qualifications to serve as a director include his extensive experience as founder and Golden State Foodssenior executive of a corporate finance advisory firm, as well as his prior experience as a managing partner at a major banking institution. In addition, the Board considered Mr. Vincent’s many years serving as a director and trustee at various funds of a registered investment company, his service as a member or chair of the audit committees for public companies and funds, and his investment banking, capital market and financial expertise. Mr. Vincent’s education (Mr. Vincent has a bachelor’s degree in mathematics and engineering from Yale University and a Master of Business Administration degree with a concentration in finance from Harvard University) and experience provide him with financial expertise.
| JOHN L. WALSH President and Chief Executive Officer Director since 2005 Age 59 Member, Executive Committee | |
Mr. Walsh is a Director and President (since 2005) and Chief Executive Officer (since 2013) of UGI Corporation.
In addition, Mr. Walsh serves as a Director
Mr. Walsh’s qualifications to serve as a director include his extensive strategic planning, operational and executive leadership experience as the Company’s CEO and President, his previous service as the Company’s Chief Operating Officer, (1996 to 1999).and his prior senior management experience with a global public company. Mr. Hermance is a memberWalsh has in-depth knowledge of the BoardCompany’s businesses, competition, risks, and health, environmental and safety issues. Mr. Walsh, by virtue of Trustees of the Rochester Institute of Technologyhis current position and Chairman of the Greater Philadelphia Alliance for Capitalhis previous position at a multinational industrial gas company, possesses international experience, as well as management development and Technologies. He also serves as a Director of IDEX Corporation and as a member of the Compensation Committee of the IDEX Board.
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| CORPORATE GOVERNANCE |
The business of UGI Corporation is managed under the direction of the Board of Directors. As part of its duties, the Board oversees the corporate governance of the Company for the purpose of creating long-term value for its shareholders and safeguarding its commitment to its other stakeholders: our employees, our customers, our suppliers and creditors, and the communities in which we do business. To accomplish this purpose, the Board considers the interests of the Company’s stakeholdersshareholders when, together with management, it sets the strategies and objectives of the Company.
The Board, also evaluates management’s performancerecognizing the importance of good corporate governance in pursuing those strategies and achieving those objectives.
The full text of the Company’s Principles of Corporate Governance can be found on the Company’s website,www.ugicorp.com, under Investor Relations, Corporate Governance or in print, free of charge, upon written request.
The Board has determined that, other than Messrs. Greenberg and Corporate Governance. Walsh, no Director has a material relationship with the Company, and each Director satisfies the criteria for an “independent director” under the rules of the New York Stock Exchange.
The Board has established the following guidelines to assist it in determining director independence:
(i) if a Director serves as an officer, director or trustee of a non-profit organization, charitable contributions to that organization by the Company has also adopted (i)and its affiliates in an amount up to $250,000 per year will not be considered to result in a Code of Ethics for the Chief Executive Officer and Senior Financial Officers that applies to the Company’s Chief Executive Officer, Principal Financial Officer and Chief Accounting Officer, and (ii) a Code of Business Conduct and Ethics for Directors, Officers and Employees. Both Codesmaterial relationship between such Director and the ChartersCompany, and
(ii) service by a Director or his immediate family member as an executive officer or employee of a company that makes payments to, or receives payments from, the Company or its affiliates for property or services in an amount that, in any of the Corporate Governance, Audit,last three fiscal years, did not exceed the greater of $1 million or 2% of such other company’s consolidated gross revenues will not be considered to result in a material relationship between such Director and Compensationthe Company.
In making its determination of independence, the Board considered ordinary business transactions between Ms. Puccio’s and Management Development CommitteesMr. Hermance’s employers and subsidiaries of the Company that were in compliance with the categorical standards set by the Board of Directors are posted on the Company’s website,www.ugicorp.com, under Investor Relations and Corporate Governance. All of these documents are also available free of charge by writing to Hugh J. Gallagher, Treasurer, UGI Corporation, P.O. Box 858, Valley Forge, PA 19482, or by calling 1-800-844-9453.
for determining director independence.
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The Board of Directors determines whichthe most appropriate Board leadership structure best serves its needsto ensure effective and thoseindependent leadership while also ensuring appropriate insight into the operations and strategic issues of our shareholders.the Company. Currently, the Company’s Board leadership consists of a non-executive Chairman, a Presiding Director and strong committee chairmen. Mr. Greenberg serveshas served as bothNon-Executive Chairman ofsince his retirement from the Board of Directors and Chief Executive Officer of the Company.Company in 2013. The Board believes that the Company is best served by having Mr. Greenberg serve in both capacities has the following advantages for the Company: there is a single source of leadership and authority for the Board; the preparation for Board meetings, in particular the format and content of Board presentations, is very efficient; there is no needas Non-Executive Chair due to incur additional costs by providing a separate chairman with administrative support and increased compensation; and Mr. Greenberg’shis unique, in-depth knowledge of the Company’s corporate strategy and operating history enhances effective communication between the Board and management. The Board may separate the roles of Chairman and Chief Executive Officer in the future if circumstances change, such as in connection with a transition in leadership.
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Senior management of the Company is responsible for assessing and managing risk. Senior management has developed an enterprise risk is the responsibility of senior management ofprocess intended to identify, prioritize and monitor key risks that may affect the Company. Our Board plays an important role in overseeing management’s performance of these functions. TheIn addition to general oversight by the Board, the Board has approved the charter of its Audit Committee, and the charter sets out the primary responsibilities of the Audit Committee. Those responsibilities require the Audit Committee to discuss with management, the general auditor and the independent auditors the Company’s enterprise risk management policies and risk management processes, including major risk exposures, risk mitigation, and the design and effectiveness of the Company’s processes and controls to prevent and detect fraudulent activity.
Our businesses are subject to a number of risks and uncertainties, which are described in detail in our Annual Report on Form 10-K for the year ended September 30, 2011.2014. Throughout the year, in conjunction with its regular business presentations to the Board and its committees, management highlights significant related risks and risk mitigation plans. Management also reports to each of the Audit CommitteeCommittees and the Board on steps being taken to enhance management processes and controls in light of evolving market, business, regulatory and other conditions. The ChairmanChair of the Auditeach Committee reports to the entire Board on the Audit Committee’stheir respective committee’s activities and decisions. In addition, on an annual basis, an extended meeting of the Board is dedicated to reviewing the Company’s shortshort- and long-term strategies and objectives, including consideration of significant risks to the execution of those strategies and the achievement of the Company’s objectives.
Board Meetings and Chief Executive Officer is ultimately responsible for the effectiveness of the Company’s risk management processes and he is an integral part of our day-to-day execution of those processes. As a result of his dual role, Mr. Greenberg’s ability to lead management’s risk management program and to assist in the Board’s oversight of that program improves the effectiveness of both the Board’s leadership structure and its oversight of risk.
Attendance
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Annually, the Corporate Governance Committee monitors and assesses the structure, composition, operations and performance of the Board and, if appropriate, makes recommendations for changes.
The Boardcharters of Directors has established the Audit Committee, the Compensation and Management Development Committee, the ExecutiveCorporate Governance Committee, and theSafety, Environmental and Regulatory Compliance Committee can be found on our Company’s website,www.ugicorp.com, under Investor Relations, Corporate Governance Committee. Allor in print, free of these Committees are responsible to the full Board of Directors. The functions of and other information about these Committees are summarized below.
| Name | Audit Committee | Corporate Governance Committee | Compensation and Management Development Committee | Executive Committee | Safety, Environmental and Regulatory Compliance Committee | ||||||||||
R. W. Gochnauer | 1, 2 | X | X | ||||||||||||
L. R. Greenberg | |||||||||||||||
| X | |||||||||||||||
F. S. Hermance | 1 | X | Chair | ||||||||||||
E. E. Jones | 1 | Chair | X | ||||||||||||
A. Pol | 1 | X | X | ||||||||||||
M. S. Puccio | 1, 2 | X | X | ||||||||||||
M. O. Schlanger | 1, 3 | X | Chair | Chair | |||||||||||
R. B. Vincent | |||||||||||||||
| 1, 2 | Chair | X | |||||||||||||
J. L. Walsh | |||||||||||||||
| X | |||||||||||||||
| (1) | Independent Director |
| (2) | Audit Committee Financial Expert |
| (3) | Presiding Director |
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Audit Committee
Each of the members of the Audit Committee is “independent” as defined by the New York Stock Exchange listing standards.
MEETINGS HELD LAST YEAR: 7
Compensation and Management Development Committee
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Each of the members of the Compensation and Management Development Committee is “independent” as defined by the New York Stock Exchange listing standards.
MEETINGS HELD LAST YEAR: M.O. Schlanger (Chairman), E.E. Jones,5
Corporate Governance Committee
The Corporate Governance Committee (i) identifies nominees and A. Pol.
Each of the members of the Committee is “independent” as defined by the New York Stock Exchange listing standards.
MEETINGS HELD LAST YEAR: 5
Safety, Environmental and Regulatory Compliance Committee
The Safety, Environmental and Regulatory Compliance Committee (i) reviews the adequacy of, and provides oversight with respect to, the Company’s safety, environmental and regulatory compliance policies,
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programs, procedures, initiatives and training; (ii) reviews risks associated with the Company’s international businesses; (iii) reviews reports regarding the Company’s code of ethical conduct for employees to the extent relating to safety, environmental or regulatory compliance matters; and (iv) keeps abreast of the regulatory environment within which the Company operates.
Each of the members of the Committee is “independent” as defined by the New York Stock Exchange listing standards.
MEETINGS HELD LAST YEAR: 3
Executive Committee
The Committee has limited powers to act on behalf of the Board of Directors between regularly scheduled meetings on matters that cannot be delayed.
MEETINGS HELD LAST YEAR: 4
The members of the Compensation and Management Development Committee are Mr.Messrs. Schlanger, Mr.Hermance and Jones and Mrs. Pol. None of the members is a former or current officer or employee of the Company or any of its subsidiaries, or is an executive officer of another company where an executive officer of UGI Corporation is a director.
Executive Committee
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The Corporate Governance Committee seeks director candidates based upon a number of qualifications, including their independence, knowledge, judgment, character, leadership skills, education, experience, financial literacy, standing in the community, and ability to foster a diversity of backgrounds and views and to complement the Board’s existing strengths. The Committee seeks individuals who have a broad range of demonstrated abilities and accomplishments in areas of importance to the Company, such as general management, finance, energy distribution, international business, law and public sector activities. Directors should also possess a willingness to challenge and stimulate management and the ability to work as part of a team in a collegial atmosphere. The Committee also seeks individuals who are capable of devoting the required amount of time to serve effectively on the Board and its Committees. With respect to incumbent Directors, the Committee also considers past performance of the Director on the Board. As part of the process of selecting independent Board candidates, the Committee obtains an opinion of the Company’s General Counsel that there is no reason to believe that the Board candidate is not “independent” as defined by the New York Stock Exchange listing standards. The Committee generally relies upon recommendations from a wide variety of its business contacts, including current non-management Directors, executive officers, community leaders, and shareholders as a source for potential Board candidates. The Committee may also use the services of a third-party executive search firm to assist it in identifying and evaluating possible nominees for director. Mr. Hermance was recommended to the Committee as a possible nominee by a third-party executive search firm.
The Committee conducts an annual assessment of the composition of the Board and Committees and reviews with the Board the appropriate skills and characteristics required of Board members. When considering whether the Board’s Directors and nominees have the experience, qualifications, attributes and skills, taken as a whole, to satisfy the oversight responsibilities of the Board, the Committee and the Board consideredconsider primarily the information about the backgroundsbackground, experience and experiencesskills of each of the nominees contained under the caption “Nominees” on pages 8 to 11. In particular, with regard to Dr. Ban, the Board considered his extensive energy industry and emerging energy technologies knowledge and experience, including his experience as Chief Executive Officerdescribed in Item 1, Election of the Gas Research Institute, and his public company directorship and committee experience. With regard to Mr. Greenberg, the Board considered his executive leadership and vision demonstrated in leading the Company’s successful growth for more than 16 years, and his extensive industry knowledge and experience. With regard to Mr. Schlanger, the Board considered his senior management experience as Chief Executive Officer, Chief Operating Officer, and Chief Financial Officer of Arco Chemical Company, a large public company, and his experience serving as chairman, director and committee member on the boards of directors of large public and private international companies, including his experience serving on boards of directors of public companies as a result of being nominated by a major shareholder. With regard to Mrs. Pol, the Board considered her significant experience as a senior executive managing high technology, traditional manufacturing and services businesses, including experience in human resource management, and her insight into government regulatory issues. With regard to Mr. Jones, the Board considered his extensive experience managing government and non-profit organizations as Chief Executive Officer, his public and private company directorship experience and his insight into workforce, regulatory, banking and legal issues. With regard to Mr. Walsh, the Board considered his experience managing the Company as Chief Operating Officer, his prior senior management experience with a global public company, and his broad industry knowledge and insight. With regard to Mr. Vincent, the Board considered his senior executive experience in banking and
Directors.
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for the previous year’s annual meeting. Notification must include certain information detailed in the Company’s bylaws.Bylaws. If you intend to nominate a candidate from the floor at anthe annual meeting, please contact the Corporate Secretary.
Director Stock Ownership Guidelines
The Board of Directors has a policy requiring Directors to own Company common stock, together with stock units, in an aggregate amount equal to five times the Director’s annual cash retainer, and to achieve the target level of common stock ownership within five years after joining the Board.
The Company has also adopted (i) a Code of Ethics for the Chief Executive Officer and Senior Financial Officers that applies to the Company’s Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer, and (ii) a Code of Business Conduct and Ethics for Directors, Officers and Employees. Both Codes are posted on the Company’s website,www.ugicorp.com, under Investor Relations – Corporate Governance Committee Members:
You may contact the Board of Directors, an individual non-management director, or the non-management Directors as a group by writing to them c/o UGI Corporation, P.O. Box 858, Valley Forge, PA 19482. These contact instructions have been posted on the Company’s website atwww.ugicorp.com under Investor Relations and– Corporate Governance.
Any communications directed to the Board of Directors, an individual non-management director, or the non-management Directors as a group from employees or others that concern complaints regarding accounting, financial statements, internal controls, ethical, or auditing matters will be handled in accordance with procedures adopted by the Audit Committee of the Board.
Committee.
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Typically, we do not forward to our Board of Directors communications from our shareholders or other parties whichthat are of a personal nature or are not related to the duties and responsibilities of the Board, including, customer complaints,but not limited to junk mail and mass mailings, resumes and other forms of job inquiries, opinion surveys and polls, and business solicitations.
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| COMPENSATIONOF DIRECTORS |
| Change in | ||||||||||||||||||||||||||||
| Pension Value | ||||||||||||||||||||||||||||
| Fees | Non-Equity | and | ||||||||||||||||||||||||||
| Earned | Incentive | Nonqualified | All | |||||||||||||||||||||||||
| or Paid | Stock | Option | Plan | Deferred | Other | |||||||||||||||||||||||
| in Cash | Awards | Awards | Compen- | Compensation | Compensation | Total | ||||||||||||||||||||||
| Name | ($)(1) | ($)(2) | ($)(3) | sation ($) | Earnings ($)(4) | ($) | ($) | |||||||||||||||||||||
| (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | |||||||||||||||||||||
| S. D. Ban | 67,000 | 137,220 | 46,155 | 0 | 0 | 0 | 250,375 | |||||||||||||||||||||
| R. W. Gochnauer | 43,228 | 82,518 | 46,155 | 0 | 0 | 0 | 171,901 | |||||||||||||||||||||
R. C. Gozon(5) | 20,472 | 170,937 | 46,155 | 0 | 0 | 0 | 237,564 | |||||||||||||||||||||
| F.S. Hermance | 2,068 | 34,884 | 0 | 0 | 0 | 0 | 36,952 | |||||||||||||||||||||
| E. E. Jones | 65,472 | 105,782 | 46,155 | 0 | 1,142 | 0 | 218,551 | |||||||||||||||||||||
| A. Pol | 67,000 | 138,531 | 46,155 | 0 | 742 | 0 | 252,428 | |||||||||||||||||||||
| M.S. Puccio | 67,000 | 85,989 | 46,155 | 0 | 0 | 0 | 199,144 | |||||||||||||||||||||
| M. O. Schlanger | 72,000 | 127,822 | 46,155 | 0 | 0 | 0 | 245,977 | |||||||||||||||||||||
| R. B. Vincent | 72,000 | 93,636 | 46,155 | 0 | 0 | 0 | 211,791 | |||||||||||||||||||||
| Director Compensation Table – Fiscal 2014 | ||||||||||||||||||||||||||||
| Name |
| Fees Earned or Paid in Cash ($)(1) |
|
| Stock Awards ($)(2) |
|
| Option Awards ($)(3) |
|
| Non-Equity Incentive Plan Compensation ($) |
|
| Change in Pension Value And Nonqualified Deferred Compensation Earnings ($)(4) |
|
| All Other Compensation ($) |
|
| Total ($) |
| |||||||
| (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | |||||||||||||||||||||
R. W. Gochnauer | 82,000 | 123,330 | 61,778 | 0 | 0 | 0 | 267,108 | |||||||||||||||||||||
L. R. Greenberg | 400,000 | 0 | 0 | 0 | 0 | 0 | 400,000 | |||||||||||||||||||||
F. S. Hermance | 84,500 | 121,768 | 61,778 | 0 | 0 | 0 | 268,046 | |||||||||||||||||||||
E. E. Jones | 87,000 | 155,343 | 61,778 | 0 | 1,283 | 0 | 305,404 | |||||||||||||||||||||
A. Pol | 77,000 | 197,758 | 61,778 | 0 | 834 | 0 | 337,370 | |||||||||||||||||||||
M. S. Puccio | 82,000 | 129,708 | 61,778 | 0 | 0 | 0 | 273,486 | |||||||||||||||||||||
M. O. Schlanger | 112,000 | 183,888 | 61,778 | 0 | 0 | 0 | 357,666 | |||||||||||||||||||||
R. B. Vincent | 92,000 | 139,999 | 61,778 | 0 | 0 | 0 | 293,777 | |||||||||||||||||||||
| (1) | Annual Retainers. |
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| (2) | Stock Awards. All Directors named above, | |
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| (3) | Stock Options. All non-management Directors, | |
| (4) | The amounts shown in column (f) represent above-market earnings on deferred compensation. Earnings on deferred compensation are considered above-market to the extent that the rate of interest exceeds 120 percent of the applicable federal long-term rate. For purposes of the Director Compensation Table | |
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REPORTOFTHE COMPENSATIONAND MANAGEMENT DEVELOPMENT COMMITTEEOF THE BOARDOF DIRECTORS |
The Committee has reviewed and discussed with management theCompensation Discussion and Analysis included in this proxy statement. Based on this review and discussion, the Committee recommended to the Company’s Board of Directors, and the Board of Directors approved, the inclusion of theCompensation Discussion and Analysis in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 20112014 and the Company’s proxy statement for the 20122015 Annual Meeting of Shareholders.
Compensation and Management
Development Committee
Marvin O. Schlanger, Chairman
Frank S. Hermance
Ernest E. Jones
Anne Pol
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| REPORTOFTHE AUDIT COMMITTEEOFTHE BOARDOF DIRECTORS |
The Audit Committee is composed of independent Directors as defined by the rules of the New York Stock Exchange and acts under a written charter adopted by the Board of Directors. As described more fully in its charter, the role of the Committee is to assist the Board of Directors in its oversight of the quality and integrity of the Company’s financial reporting process. The Committee also has the sole authority to appoint, retain, fix the compensation of and oversee the work of the Company’s independent auditors.
In this context, the Committee has met and held discussions with management and the independent auditors to review and discuss the Company’s internal control over financial reporting, the interim unaudited financial statements, and the audited financial statements for Fiscal 2011.2014. The Committee also reviewed management’s report on internal control over financial reporting, required under Section 404 of the Sarbanes-Oxley Act of 2002. As part of this review, the Committee reviewed the bases for management’s conclusions in that report and the report of the independent registered public accountants on the effectiveness of the Company’s internal control over financial reporting. The Committee has also discussed with the independent auditors the matters required to be discussed by Statement on Auditing Standards No. 61,Communication with Audit Committees,as amended, and as adopted by the Public Company Accounting Oversight Board, and the independent auditors’ independence. In addition, the Committee has received the written disclosures and the letter from the independent auditors required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent accountant’s communications with the Audit Committee concerning independence.
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The members of the Committee are not professionally engaged in the practice of auditing or accounting. The members of the Committee rely, without independent verification, on the information provided to them and on the representations made by management and the independent auditors. Accordingly, the Committee’s considerations and discussions referred to above do not assure that the audit of the Company’s financial statements has been carried out in accordance with auditing standards generally accepted in the United States of America, that the financial statements are presented in accordance with accounting principles generally accepted in the United States of America or that our auditors are, in fact, “independent.”
PricewaterhouseCoopers LLP served as the Company’s independent registered public accounting firm for Fiscal 2014 and its audit report appears in our Annual Report on Form 10-K for the fiscal year ended September 30, 2014. As a result of the Audit Committee’s request for proposal process for audit services that was conducted during Fiscal 2014, the Audit Committee selected Ernst & Young LLP as the Company’s independent registered public accounting firm for the 2015 fiscal year.
Based upon the reviews and discussions described in this report, the Committee recommended to the Board of Directors, and the Board of Directors approved, that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 20112014 for filing with the SEC.
Audit Committee
Roger B. Vincent, ChairmanAnne Pol
Richard W. Gochnauer
M. Shawn Puccio
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| OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM |
In the course of its meetings, the Audit Committee considered whether the provision by PricewaterhouseCoopers LLP of the professional services described below was compatible with PricewaterhouseCoopers LLP’s independence. The Committee concluded that our independent registered public accounting firm is independent from the Company and its management.
Consistent with SEC policies regarding auditor independence, the Audit Committee has responsibility for appointing, setting compensation and overseeing the work of the Company’s independent accountants. In recognition of this responsibility, the Audit Committee has a policy of pre-approving all audit and permissible non-audit services provided by the independent accountants.
The Audit Committee has delegated such approval authority to its chairman, to be exercised in the intervals between meetings, in accordance with the Audit Committee’s pre-approval policy.
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| 2011 | 2010 | |||||||
Audit Fees(1) | $ | 3,421,000 | $ | 3,146,650 | ||||
| Audit-Related Fees | 0 | 0 | ||||||
Tax Fees(2) | 600,000 | 600,000 | ||||||
All Other Fees(3) | 3,000 | 212,000 | ||||||
| Total Fees for Services Provided | $ | 4,024,000 | $ | 3,958,650 | ||||
| 2014 | 2013 | |||||||
Audit Fees(1) | $ | 7,896,372 | $ | 4,432,304 | ||||
Audit-Related Fees(2) | 350,000 | 11,000 | ||||||
Tax Fees(3) | 546,000 | 634,825 | ||||||
All Other Fees(4) | 11,900 | 160,353 | ||||||
|
|
|
| |||||
Total Fees for Services Provided | $ | 8,804,272 | $ | 5,238,482 | ||||
| (1) | Audit Fees were for audit services, including (i) the annual audit of the consolidated financial statements of the Company, (ii) subsidiary audits, (iii) review of the interim financial statements included in the Quarterly Reports on Form 10-Q of the Company, AmeriGas Partners and UGI Utilities, Inc., and (iv) services that only the independent registered public accounting firm can reasonably be expected to provide, including the issuance of comfort letters. In addition, Audit Fees include $1,999,478 for audit services related to a three-year audit of UGI International. | |
| (2) | Audit-Related Fees were for due diligence associated with a potential acquisition in France. |
| (3) | Tax Fees were for the preparation of Substitute Schedule K-1 forms for unitholders of AmeriGas |
All Other Fees |
As a result of the Audit Committee’s request for Approval of Related Person Transactions
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| POLICYFOR APPROVALOF RELATED PERSON TRANSACTIONS |
The Company’s Board of Directors has a written policy for the review and approval of Related Person Transactions. The policy applies to any transaction in which (i) the Company or any of its subsidiaries is a participant, (ii) any related person has a direct or indirect material interest, and (iii) the amount involved exceeds $120,000, except for any such transaction that does not require disclosure under SEC regulations. The Audit Committee of the Board of Directors, with assistance from the Company’s General Counsel, is responsible for reviewing, approving and ratifying related person transactions. The Audit Committee intends to approve or ratify only those related person transactions that are in, or not inconsistent with, the best interests of the Company and its shareholders.
| COMPENSATION DISCUSSIONAND ANALYSIS |
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Compensation decisions for Messrs. Greenberg, Walsh, Knauss, KellyOliver, and FlexonHall and Ms. Gaudiosi were made by the independent members of our Board of Directors after receiving the recommendations of its Compensation and Management Development Committee. Compensation decisions for Mr. BissellSheridan were made by the independent members of the Board of Directors of AmeriGas Propane, Inc. (“AmeriGas Propane”), the General Partner of AmeriGas Partners, L.P. (“AmeriGas Partners”) after receiving the recommendation of its Compensation/Pension Committee. Compensation decisions for Mr. Varagne were approved by the independent members of our Board of Directors after receiving the recommendation of our Compensation and Management Development Committee, as well as by the Board of Directors of Antargaz’ parent company, AGZ Holding. For ease of understanding, we will use the term “we” to refer to UGI Corporation and AmeriGas Propane, Inc. and/or AGZ Holding and the term “Committee” or “Committees” to refer to the UGI Corporation Compensation and Management Development Committee and/or the AmeriGas Propane, Inc. Compensation/Pension Committee, as appropriate, in the relevant compensation decisions, unless the context indicates otherwise. We refer to our 20112014, 2013, and 20102012 fiscal years as “Fiscal 2011”2014,” “Fiscal 2013,” and “Fiscal 2010,2012,” respectively.
On July 29, 2014, our Board of Directors approved a numberthree-for-two split of months earlier, he did not participate in the Company’s annual bonus plancommon stock. The record date for the stock split was August 22, 2014 and was not awarded any new equity compensation in Fiscal 2011.
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Our compensation program for named executive officers is designed to:
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| • |
|
The following are some of the Company’s Fiscal 2014 performance highlights:
• Adjusted earnings per share1 (“Adjusted EPS”) increased 26% to $1.99; • Net income attributable to UGI Corporation increased 21%; • The Board of Directors approved a 3-for-2 stock split; • The Board of Directors increased the annual dividend by over 10%; and • As illustrated in the accompanying chart, the Company’s one-year total shareholder return was over 35%, significantly outperforming the S&P 500 Utilities Index and the peer group referenced by the Compensation Committee for purposes of its long-term compensation plan. |
|
1 UGI Corporation’s Fiscal 2014 earnings per share is adjusted to exclude (i) Midstream and Marketing’s and AmeriGas Propane’s net loss on commodity derivative instruments not associated with Fiscal 2014 transactions ($.04 per diluted share), and (ii) the retroactive impact of changes in French tax law ($.03 per diluted share).
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| • | Fiscal 2014 Components |
The following chart provides a brief summary ofsummarizes the principal elements of our Fiscal 2014 executive compensation program for Fiscal 2011.program. We describe these elements, as well as a discretionary bonus and discretionary equity grant awarded to Ms. Gaudiosi and Mr. Sheridan, respectively, retirement, severance and other benefits, in more detail later in thisCompensation Discussion and Analysis.
Principal Components of Compensation Paid to Named Executive Officers in Fiscal 20112014
| Component | Principal Objectives | |||||||
| Fiscal 2014 Compensation | ||||||||
| Base Components | ||||||||
Salary | Compensate executives as appropriate for | Merit salary increases | ||||||
| Annual Bonus Awards | Motivate executives to focus on achievement of our annual business objectives. | Target incentives ranged from Actual | ||||||
| financial goals. | ||||||||
| Long-Term | ||||||||
Stock Options | Align executive interests with shareholder interests; create a strong financial incentive for achieving or exceeding long-term | The | ||||||
Performance Units | Align executive interests with shareholder interests; create a strong financial incentive for achieving long-term performance goals by encouraging total Company shareholder return that compares favorably to other utility-based companies or total AmeriGas Partners common unitholder return that compares favorably to other energy master limited partnerships. | The number of performance units awarded in Fiscal 2014 ranged from 7,950 to 63,000. Performance units (payable in UGI Corporation common stock, other than for Mr. Sheridan) will be earned based on total shareholder return of Company stock | For Mr. Sheridan, performance units | |||||
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| • | Link Between Our Financial Performance and Executive Compensation |
The Committee sets rigorous goals for our executive officers that are directly tied to the top Fortune 500 companies forCompany’s financial performance and our total return to our shareholders, overand in the last 10 years.case of AmeriGas Partners, our total return to our unitholders. We believe that the principal performance-based components of our compensation program, namely our stock options and performance units, have effectively linked our executives’ compensation to our financial performance, as indicated below.
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|  |
To better illustrate the total direct performance-based compensation paid or awarded to Mr. GreenbergWalsh in Fiscal 2011, 20102014, 2013 and 2009.2012, the following table is provided as supplemental information. A comparable illustration would apply to our other named executive officers. The information in the supplemental table below differs from the information in the Summary Compensation Table in several ways. Specifically, the table below (i) omits the columns captioned “Change in Pension Value and Nonqualified Deferred Compensation Earnings” and “All Other Compensation” because those dollarthese amounts are not generally relatedconsidered in establishing annual total cash compensation and total direct compensation and some of the amounts in those columns of the Summary Compensation Table can vary significantly from year to year. The table below shows Mr. Walsh’s direct compensation for the last three fiscal years. Mr. Walsh’s non-equity incentive compensation payouts reflect the Company’s improved EPS performance (ii) showsduring the three-year period, while his actual (or estimated in the case of performance related to Fiscal 2011)2014) performance unit payout values, and (iii) showspayouts during the intrinsic valueperiod clearly demonstrate shareholder returns for the Company that are in excess of stock options awarded based on UGI’s stock price on September 30, 2011.
| Total Intrinsic Value | ||||||||||||||||||||
| of Stock Options | ||||||||||||||||||||
| Granted in Fiscal | ||||||||||||||||||||
| Performance | 2011 (Valued at | Total Direct | ||||||||||||||||||
| Fiscal Year | Salary | Bonus | Unit Payout(1) | 9/30/11) | Compensation | |||||||||||||||
| 2011 | $ | 1,099,540 | $ | 1,072,821 | $ | 0 | (2) | $ | 0 | $ | 2,172,361 | |||||||||
| 2010 | $ | 1,067,500 | $ | 1,145,428 | $ | 4,578,638 | (3) | $ | 624,000 | $ | 7,415,566 | |||||||||
| 2009 | $ | 1,067,500 | $ | 1,591,643 | $ | 1,931,707 | (4) | $ | 555,000 | $ | 5,145,850 | |||||||||
Fiscal Year | Salary(1) | Non-Equity Incentive Compensation | Performance Unit Payout(2) | Intrinsic Value of Stock Options in Fiscal 2014 (Valued at 9/30/14) | Total Direct Compensation | |||||||||||||||
2014 | $ | 1,028,300 | $ | 1,974,336 | $ | 2,842,806 | (3) | $ | 2,612,250 | $ | 8,457,692 | |||||||||
2013 | $ | 861,710 | $ | 902,454 | $ | 1,250,970 | (4) | $ | 3,300,090 | $ | 6,315,224 | |||||||||
2012 | $ | 701,470 | $ | 413,478 | $ | 597,764 | (5) | $ | 2,716,875 | $ | 4,429,587 | |||||||||
| (1) | Mr. Walsh’s Fiscal 2013 salary reflects his service as President and Chief Operating Officer (until April 1, 2013) and his promotion to President and Chief Executive Officer (effective April 1, 2013). Mr. Walsh’s Fiscal 2012 salary reflects his service as the Company’s President and Chief Operating Officer. |
| (2) | Payout calculated for three-year performance periods based on calendar years, not fiscal years. |
Estimated based on performance through |
Actual payout for the |
Actual payout for the |
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Short-Term Incentives — Annual Bonuses
Our annual bonuses are directly tied to one key financial metricmetrics for each executive — earnings per share– Adjusted EPS (in the case of Messrs. Greenberg, Walsh and Knauss)Oliver and Ms. Gaudiosi), net income of UGI Energy Services, LLC and its subsidiaries (“UGI Energy Services”), adjusted to exclude the loss on Midstream and Marketing’s commodity derivative instruments not associated with Fiscal 2014 transactions (in the case of Mr. Hall), and AmeriGas Propane’s earnings perbefore interest, taxes, depreciation and amortization, adjusted to exclude the mark-to-market loss in commodity derivative instruments at AmeriGas Partners common unit, as adjustedPropane (“Adjusted EBITDA”), and then modified for customer growth (in the case of Mr. Bissell),Sheridan). For Mr. Sheridan, a portion of his bonus is also tied to achievement of customer service goals. As illustrated in the below chart, when the Company’s Adjusted EPS exceeds the targeted goal, the annual bonus percentage paid to a named executive officer exceeds the targeted payout amount. Similarly, when Adjusted EPS is below the targeted goal, the annual bonus percentage paid to a named executive officer is less than the targeted payout amount. The forgoing correlation between the Adjusted EPS and Antargaz earnings before interest, taxes, depreciationbonus payout amounts would also be true with respect to the correlation between (i) Adjusted EBITDA and amortization (“EBITDA”) (in the case of Mr. Varagne).Sheridan’s bonus payout and (ii) UGI Energy Services’ adjusted net income and Mr. Hall’s bonus payout. Each Committee has discretion under our executive annual bonus plans to (i) adjust EPU,Adjusted EPS and Adjusted EBITDA results for extraordinary items or other events as the Committee deems appropriate, and (ii) increase or decrease the amount of an award determined to be payable under the bonus plan by up to 50 percent. For Fiscal 2011, each2014, the Committee exercised its discretion and adjusted the actual Adjusted EPS for bonus purposes to (i) exclude the impact of transition expenses incurred during Fiscal 2014 associated with a potential acquisition in determiningFrance, and (ii) include the executive bonuses set forthretroactive effects of changes in the table below.French tax legislation that had been excluded from Adjusted EPS. SeeCompensation Discussion and Analysis — Elements of Compensation — Annual Bonus Awards.
| Fiscal Year | UGI Corporation Targeted Adjusted EPS Range | UGI Corporation Adjusted EPS | % of Target Bonus Paid | |||||||||
2014 | $ | 1.73-$1.80 | $ | 1.98 | 160.0 | % | ||||||
2013 | $ | 1.63-$1.70 | $ | 1.59 | 95.9 | % | ||||||
2012 | $ | 1.56-$1.63 | $ | 1.17 | 62.0 | % | ||||||
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Our long-term incentive compensation program, principally comprised of stock options and performance units, is intended to create a strong financial incentive for achievement of the Company’s long-term performance goals. In addition, linking equity to compensation aligns our executives’ interests with shareholder interests.
| % of Target | ||||||||||||||||||||||||
| UGI | Bonus Paid to | AmeriGas | ||||||||||||||||||||||
| Corporation | UGI | UGI named | Partners | AmeriGas | % of Target | |||||||||||||||||||
| Fiscal | Targeted | Corporation | executive | Targeted | Partners | Bonus Paid to | ||||||||||||||||||
| Year | EPS Range | Actual EPS | officers) | EPU Range | Actual EPU | Mr. Bissell | ||||||||||||||||||
| 2011 | $ | 2.30-$2.40 | $ | 2.06 | 88.7 | % | $ | 3.12-$3.26 | $ | 2.30 | 72.2 | % | ||||||||||||
| 2010 | $ | 2.20-$2.30 | $ | 2.36 | 107.3 | % | $ | 2.97-$3.14 | $ | 2.80 | 89.2 | % | ||||||||||||
| 2009 | $ | 2.10-$2.20 | $ | 2.36 | 149.1 | % | $ | 2.72-$2.86 | $ | 3.59 | 115.1 | % | ||||||||||||
Stock option values reported in the Summary Compensation Table reflect the valuation methodology mandated by SEC regulations, which is based on grant date fair value as determined under generally accepted accounting principles in the United States (“GAAP”). Therefore, the amounts shown under “Option Awards” in the Summary Compensation Table do not reflect performance of the underlying shares subsequent to the grant date. From the perspective of our executives,executives’ perspectives, the value of a stock option is based on the excess of the market price of the underlying shares over the exercise price (sometimes referred to as the “intrinsic value”) and, therefore, is directly affected by market performance of the Company’s stock. For example, all stock options granted to the named executive officers (other than Mr. Flexon, whose options were forfeited upon his resignation) in Fiscal 2011 have an exercise price of $31.58 per share, but by September 30, 2011, the market price per share of Company stock declined to $26.27. As a result of the marketCompany’s performance, of the Company’s stock, as of September 30, 2011, all options granted in Fiscal 2011 had no intrinsic value. As further demonstrated by the following table, which pertains to stock options granted in Fiscal 2011 to Mr. Greenberg, the fiscal year-end intrinsic value of the options granted to our executives during Fiscal 20112014 is lessmore than the amounts set forth in column (f) of the Summary Compensation Table.
| Number of Shares | Summary | Total Intrinsic | ||||||||||||||||||
| Underlying | Compensation | Exercise | Price Per | Value of | ||||||||||||||||
| Fiscal | Options Granted | Table Option | Price Per | Share at | Options at | |||||||||||||||
| Year | to Mr. Greenberg | Awards Value | Share | 9/30/11 | 9/30/11 | |||||||||||||||
| 2011 | 300,000 | $ | 1,629,000 | $ | 31.58 | $ | 26.27 | $ | 0 | |||||||||||
| 2010 | 300,000 | $ | 1,347,000 | $ | 24.19 | $ | 26.27 | $ | 624,000 | |||||||||||
| 2009 | 300,000 | $ | 1,218,000 | $ | 24.42 | $ | 26.27 | $ | 555,000 | |||||||||||
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shareholder returns. The table below illustrates the intrinsic value of the stock options granted to Mr. Walsh in Fiscal 2014, Fiscal 2013 and Fiscal 2012, respectively.
Fiscal Year | Number of Share Underlying Options Granted to Mr. Walsh | Summary Compensation Table Option Awards Value | Exercise Price Per Share | Price Per Share at 9/30/14 | Total Intrinsic Value of Options at 9/30/14 | |||||||||||||||
2014 | 405,000 | $ | 1,992,060 | $ | 27.64 | $ | 34.09 | $ | 2,612,250 | |||||||||||
2013 | 307,500 | $ | 1,060,319 | $ | 21.81-$25.50 | (1) | $ | 34.09 | $ | 3,300,090 | ||||||||||
2012 | 187,500 | $ | 543,065 | $ | 19.60 | $ | 34.09 | $ | 2,716,875 | |||||||||||
| (1) | Mr. Walsh received 178,500 options on January 1, 2013 with an exercise price of $21.81 and, in connection with his promotion to Chief Executive Officer, received 129,000 options on April 1, 2013 with an exercise price of $25.50. |
Long-Term Incentives — Performance Units
Performance units are valued upon grant date in accordance with SEC regulations, based on grant date fair value as determined under GAAP. Nevertheless, the actual number of shares or partnership units ultimately awarded is entirely dependent on the total shareholder return (“TSR”) on UGI Corporation common stock (or, in the case of Mr. Bissell,Sheridan, total unitholder return (“TUR”) on AmeriGas Partners’ common units), relative to a competitive peer group, which will not be determined with respect to performance units granted in Fiscal 20112014 until the end of 2013.
2016.
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| Total Average | UGI | |||||||||||||
| UGI | Shareholder | Corporation | ||||||||||||
| UGI Corporation | Corporation | Return of Peer | Performance | |||||||||||
| Total Shareholder Return | Total | Group | Unit Payout as a | |||||||||||
| Performance | Ranking Relative to Peer | Shareholder | (Excluding UGI | Percentage of | ||||||||||
| Period (Calendar Year) | Group | Return(1) | Corporation) | Target | ||||||||||
2009 — 2011(2) | 26th out of 34 (24th percentile) | 29.2 | % | 47.5 | % | 0 | ||||||||
| 2008 — 2010 | 2nd out of 32 (97th percentile) | 27.3 | % | -9.3 | % | 191.9 | ||||||||
| 2007 — 2009 | 13th out of 30 (58th percentile) | 0.2 | % | -9.5 | % | 121.6 | ||||||||
| 2006 — 2008 | 9th out of 29 (71st percentile) | 10.4 | % | -4.3 | % | 144.0 | ||||||||
Performance Period (Calendar Year) | UGI Corporation Total Shareholder Return Group | UGI Corporation Total Shareholder Return(1) | Total Average Shareholder Return of Peer Group (Excluding UGI Corporation) | UGI Corporation Performance Unit Payout as a Percentage of Target | ||||||||||
2012 — 2014(2) | 2nd out of 39 (97th percentile) | 109.4 | % | 53.9 | % | 193.4 | % | |||||||
2011 — 2013 | 20th out of 40 (50th percentile) | 46.8 | % | 50.1 | % | 100 | % | |||||||
2010 — 2012 | 19th out of 32 (42nd percentile) | 46.9 | % | 45.4 | % | 59.7 | % | |||||||
2009 — 2011 | 24th out of 34 (30th percentile) | 35.4 | % | 50.8 | % | 0 | % | |||||||
2008 — 2010 | 2nd out of 32 (97th percentile) | 27.3 | % | -9.3 | % | 191.9 | % | |||||||
| (1) | Calculated in accordance with | |
| (2) | Estimated |
| Total Average | ||||||||||||||
| Unitholder | AmeriGas | |||||||||||||
| Return of Peer | Partners | |||||||||||||
| AmeriGas Partners | AmeriGas | Group | Performance | |||||||||||
| Total Unitholder Return | Partners Total | (Excluding | Unit Payout as a | |||||||||||
| Performance | Ranking Relative to Peer | Unitholder | AmeriGas | Percentage of | ||||||||||
| Period (Calendar Year) | Group | Return(1) | Partners) | Target | ||||||||||
2009 — 2011(2) | 12th out of 19 (39th percentile) | 95.8 | % | 123.3 | % | 0 | ||||||||
| 2008 — 2010 | 6th out of 19 (74th percentile) | 63.7 | % | 56.5 | % | 147.8 | ||||||||
| 2007 — 2009 | 6th out of 19 (72nd percentile) | 49.6 | % | 32.9 | % | 145.4 | ||||||||
| 2006 — 2008 | 5th out of 20 (79th percentile) | 21.1 | % | 2.0 | % | 156.6 | ||||||||
As noted below, beginning with performance units granted in Fiscal 2011, total shareholder return for UGI will beCorporation is compared to companies in the Russell MidCap Utilities Index (exclusive of telecommunications companies) (“Adjusted Russell MidCap Utilities Index”), rather than to companies in the S&P Utilities Index. In addition, beginning in Fiscal 2010, total unitholder return for AmeriGas Partners is compared to the energy master limited partnerships and limited liability companies in the Alerian MLP Index, rather than to the group of selected publicly-traded limited partnerships engaged in the propane, pipeline and coal industries.
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The link between the Company’s financial performance and our executive compensation program is evident in the supplemental tables provided above. The Committees believe there is an appropriate link between executive compensation and the Company’s performance.
| • | Compensation and Corporate Governance Practices |
The Committee is composed entirely of directors who are independent, as defined in the corporate governance listing standards of the New York Stock Exchange.
The Committee utilizes the services of Pay Governance LLC (“Pay Governance”), an independent outside compensation consultant.
The Company allocates a substantial portion of compensation to performance-based compensation. In Fiscal 2011, 80%2014, 84 percent of the principal compensation components, in the case of Mr. Greenberg,Walsh, and 62%66 percent to 74%75 percent of the principal compensation components, in the case of all other named executive officers, were variable and tied to financial performance or total shareholder return.
The Company awards a substantial portion of compensation in the form of long-term awards, namely stock options and performance units, so that executive officers’ interests are aligned with shareholders’ interests and long-term Company performance.
Annual bonus opportunities for the named executive officers are based primarily on key financial metrics. Similarly, long-term incentives are based on UGI Corporation common stock values and relative stock price performance (or, in the case of Mr. Bissell,Sheridan, performance relative to AmeriGas Partners common units).
We require termination of employment for payment under our change in control agreements (referred to as a “double trigger”). We also have not entered into change in control agreements providing for tax gross-up payments under Section 280G of the Internal Revenue Code since 2010. See COMPENSATION OF EXECUTIVE OFFICERS — Potential Payments Upon Termination or Change in Control.
We have meaningful stock ownership guidelines. See COMPENSATION OF EXECUTIVE OFFICERS — Stock Ownership Guidelines.
We have a recoupment policy for incentive-based compensation paid or awarded to current and former executive officers in the event of a restatement due to material non-compliance with financial reporting requirements.
We have a policy prohibiting the Company’s Directors and executive officers from (i) hedging the securities of UGI Corporation and AmeriGas Partners, (ii) holding UGI Corporation and AmeriGas Partners securities in margin accounts as collateral for a margin loan, and (iii) pledging the securities of UGI Corporation and AmeriGas Partners.
The Committee believes that, during Fiscal 2014, there was no conflict of interest between Pay Governance and the Committee. Additionally, the Committee believes that Pay Governance was independent. In reaching the foregoing conclusions, the Committee considered the factors set forth by the New York Stock Exchange regarding compensation committee advisor independence.
Compensation Philosophy and ObjectivesCOMPENSATION PHILOSOPHY AND OBJECTIVES
Our compensation program for our named executive officers is designed to provide a competitive level of total compensation necessary to attract and retain talented and experienced executives. Additionally, our
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compensation program is intended to motivate and encourage our executives to contribute to our success and reward our executives for leadership excellence and performance that promotes sustainable growth in shareholder and common unitholder value.
In Fiscal 2011,2014, the components of our compensation program included salary, annual bonus awards, a discretionary cash bonuses,bonus award to one named executive officer, long-term incentive compensation (performance unit awards, discretionary restricted unit awards and UGI Corporation stock option grants), perquisites, retirement benefits and other benefits, all as described in greater detail in thisCompensation Discussion and Analysis. We also consider granting discretionary special equity awards from time to time, although no such awards were made to the named executive officers during Fiscal 2011, except for equity awards provided to Mr. Flexon in connection with the commencement of his employment (which subsequently were forfeited upon his resignation).Analysis. We believe that the elements of our compensation program are essential components of a balanced and competitive compensation program to support our annual and long-term goals.
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provide the Committees with independent and objective market data;
conduct compensation analysis;
review and advise on pay programs and salary, target bonus and long-term incentive levels applicable to our executives; and
review components of our compensation program as requested from time to time by the Committees and recommend plan design changes, as appropriate.appropriate; and
provide general consulting services related to the fulfillment of the Committees’ charters.
Pay Governance doeshas not provide anyprovided actuarial or other services relating to pension and post-retirement plans or services related to other benefits to us or our affiliates, other thanand generally all of its services are those that it provides to the Committees.
In assessing competitive compensation, we referenced market data provided to us in Fiscal 20102013 by Pay Governance. Pay Governance provided us with two reports: the “2010“2013 Executive Cash Compensation Review” and the “2010“2013 Executive Long-Term Incentive Review.” For Mr. Varagne, Pay Governance referenced Towers Watson’s database for Top Executive Remuneration in France when assessing his salary and annual bonus awards. We do not benchmark against specific companies in the databases utilized by Pay Governance in preparing its reports. Our Committees do benchmark, however, by using Pay Governance’s analysis of compensation databases that include numerous companies as a reference point to provide a framework for compensation decisions. Our Committees exercise discretion and also review other factors, such as internal equity (both within and among our business units) and sustained individual and company performance, when setting our executives’ compensation.
In order to provide the Committee with data reflecting the relative sizes of UGI’s nonutility and utility businesses, Pay Governance first referenced compensation data for comparable executive positions in each of the Towers Watson 20102013 General Industry Executive Compensation Database (“General Industry Database”) and the Towers Watson 20102013 Energy Services Executive Compensation Database (“Energy Services Database”). Towers Watson’s General Industry Database is comprised of approximately 430440 companies from a broad range of industries, including oil and gas, aerospace, automotive and transportation, chemicals, computer, consumer products, electronics, food and beverages, metals and mining, pharmaceutical and telecommunications. The Towers Watson Energy Services Database is comprised of approximately 100105 companies, primarily utilities. For the named executive officers, other
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market rate derived from information in the Energy Services Database was $90,000, Pay Governance would provide us with a market rate of $97,500 for that position ($(($100,000 x 75 percent = $75,000) plus ($90,000 x 25 percent = $22,500)). The impact of weighting information derived from the two databases is to obtain a market rate designed to approximate the relative sizes of our nonutility and utility businesses. The different weightings do not have an impact on the Committee’s decision-making. For Mr. Bissell,Sheridan, we referenced Towers Watson’s 20102013 General Industry Database. For Mr. Varagne, Pay Governance referenced Towers Watson’s database for Top Executive Remuneration for France. That database is comprised of approximately 85 companies from a broad range of industries, including chemicals, media, aerospace, telecommunications, healthcare, automotive, oil and gas, real estate, financial services, energy services, industrial materials, consumer products, food and beverage, retail, and pharmaceuticals. The identities of the companies that comprise the databases utilized by Pay Governance have not been disclosed to us by Pay Governance.
We generally seek to position a named executive officer’s salary grade so that the midpoint of the salary range for his or her salary grade approximates the 50thpercentile of “going rate” for comparable executives included in the executive compensation database material referenced by Pay Governance. By comparable executive, we mean an executive having a similar range of responsibilities and the experience to fully perform these responsibilities. Pay Governance size-adjusted the survey data to account for the relative revenues of the survey companies in relation to ours. In other words, the adjustment reflects the expectation that a larger company would be more likely to pay a higher amount of compensation for the same position than a smaller company. Using this adjustment, Pay Governance developed going rates for positions comparable to those of our executives, as if the companies included in the respective databases had revenues similar to ours. We believe that Pay Governance’s application of size adjustments to applicable positions in these databases is an appropriate method for establishing market rates. After consultation with Pay Governance, we considered salary grade midpoints that were within 15 percent of the median going rate developed by Pay Governance to be competitive.
| • | Salary |
Salary is designed to compensate executives for their level of responsibility and sustained individual performance. We pay our executive officers a salary that is competitive with that of other executive officers providing comparable services, taking into account the size and nature of the business of UGI Corporation,the Company, AmeriGas Partners or Antargaz,UGI Energy Services, as the case may be.
As noted above, we seek to establish the midpoint of the salary grade for the positions held by our named executive officers at approximately the 50thpercentile of the going rate for executives in comparable positions. Based on the data provided by our former compensation consultant in June 2010 (the Committee retained Pay Governance in July 2010),2013, we increased the range of salary in each salary grade for Fiscal 2014 for each named executive officer, other than Mr. Greenberg,Walsh, by 1.52 percent. The Committee established Mr. Greenberg’sWalsh’s Fiscal 20112014 salary grade midpoint at the market median of comparable executives as identified by Pay Governance based on its analysis of the executive compensation databases. For Mr. Greenberg,Walsh, this resulted in a 3.8 percent reductionan increase of the range of salary in his salary grade from the prior year.
year of less than 1 percent.
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The following table sets forth each named executive officer’s Fiscal 20112014 salary.
| Percentage Increase | ||||||||
| Name | Salary | over Fiscal 2010 Salary | ||||||
| Lon R. Greenberg | $ | 1,099,540 | 3.0 | % | ||||
| John L. Walsh | $ | 674,440 | 4.0 | % | ||||
| Peter Kelly | $ | 437,008 | 2.5 | % | ||||
| Eugene V. N. Bissell | $ | 502,268 | 2.5 | % | ||||
| François Varagne | $ | 469,000 | (1) | 0 | %(2) | |||
| Robert H. Knauss | $ | 360,776 | 6.0 | % | ||||
| Robert C. Flexon | $ | 475,020 | N/A | |||||
Name | Salary | Percentage Increase over Fiscal 2013 Salary | ||||||
John L. Walsh | $ | 1,028,300 | 5.0 | %(1) | ||||
Kirk R. Oliver | $ | 522,730 | 1.5 | % | ||||
Jerry E. Sheridan | $ | 506,750 | 5.0 | %(2) | ||||
Monica M. Gaudiosi | $ | 420,290 | 3.0 | % | ||||
Bradley C. Hall | $ | 372,600 | 4.0 | % | ||||
| (1) | For purposes of the comparison to Fiscal 2013, an annualized salary that assumed Mr. Walsh had served as the President and Chief Executive Officer for the entirety of Fiscal 2013 was used. |
| (2) | Mr. | |
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| • | Annual Bonus Awards |
Our annual bonus plans provide our named executive officers with the opportunity to earn an annual cash incentivesincentive, provided that certain performance goals are satisfied. Our annual cash incentives areincentive is intended to motivate our executives to focus on the achievement of our annual business objectives by providing competitive incentive opportunities to those executives who have the ability to significantly impact our financial performance. We believe that basing a meaningful portion of an executive’s compensation on financial performance emphasizes our pay for performance philosophy and will result in the enhancement of shareholder or unitholder value.
In determining each executive position’s target award level under our annual bonus plans, we considered database information derived by Pay Governance regarding the percentage of salary payable upon achievement of target goals for executives in similar positions at other companies as described above. In establishing the target award level, we positionpositioned the amount within the 50th to 75th percentiles for comparable positions. We determined that the 50th to 75th percentile range was appropriate because we believe that the annual bonus opportunities should have a significant reward potential to recognize the difficulty of achieving the annual goals and the significant beneficial impact to the Company of such achievement. For Fiscal 2011, Mr. Greenberg’s opportunity was set at the 50thpercentile for comparable positions.
Messrs. Walsh, Oliver and the other participating named executive officers’ opportunities were set between the 50thHall and 67th percentiles.
For similar reasons, 90 percent of Mr. Bissell’sSheridan’s target award opportunity was principally based on earnings per common unit (“EPU”) of AmeriGas Partners, with the bonus achieved based on EPU,Partners’ Adjusted EBITDA, subject to adjustmentmodification based on achievement of AmeriGas Partners’ customer growth goal, as described below. The other 10 percent of Mr. Sheridan’s target award opportunity was based on achievement of customer service goals, but contingent on a payout under the financial component of the award. We believe that customer growth and customer service for AmeriGas Partners is anare important componentcomponents of EPUthe bonus calculation because we foresee no or minimal growth in total demand for propane in the next several years, and, therefore, customer growth is anand customer service are important factorfactors in our ability to improve the long-term financial performance of AmeriGas Partners. Additionally, the customer growth adjustmentmodification serves to balance the risk of AmeriGas Partners’ achieving short-term annual financial goals at the expense of AmeriGas Partners’ long-term goal to increase its customer base. For
Mr. Varagne, weHall’s target award opportunity was based on the adjusted net income of the Company’s Midstream and Marketing business conducted through its subsidiary, UGI Energy Services, and its subsidiary that conducts its electric generation business, UGI Development Company. Specifically, Mr. Hall’s target award opportunity was based (i) 85 percent on the targeted adjusted net income of UGI Energy Services (excluding UGI Development Company) and (ii) 15 percent on the targeted net income of UGI Development Company.
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Each Committee has discretion under our executive annual bonus plans to (i) adjust Adjusted EPS and Adjusted EBITDA for extraordinary items or other events as the Committee deems appropriate, (ii) increase or decrease the amount of an award determined to base his target award entirelybe payable under the bonus plan by up to 50 percent, and (iii) review quantitative factors (such as Company performance) and qualitative factors (such as individual performance and overall contributions to the Company) when determining the annual bonus to be paid to an executive who terminates employment during the fiscal year on achievementaccount of Antargaz’ budgeted EBITDA.
retirement, death or disability. The UGI Bonus Plan and the AmeriGas Bonus Plan each provides that, unless the Committee determines otherwise, all executive officers who have not fulfilled their respective equity ownership requirements receive as part of their ongoing compliance up to 10 percent of their gross annual bonus in fully vested UGI Corporation stock or AmeriGas Partners common units, as applicable.
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For Mr. Sheridan, the 90 percent component of the bonus award due to his resignation during Fiscal 2011.
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The following annual bonus payments were made for Fiscal 2011:
| Percent of Target | Amount of | |||||||
| Name(1) | Bonus Paid | Bonus | ||||||
| Lon R. Greenberg | 88.7 | % | $ | 1,072,821 | ||||
| John L. Walsh | 88.7 | % | $ | 508,494 | ||||
| Eugene V. N. Bissell | 72.2 | % | $ | 290,000 | ||||
| François Varagne | 93.0 | % | $ | 300,957 | (2) | |||
| Robert H. Knauss | 88.7 | % | $ | 208,005 | ||||
Name | Percent of Target Bonus Paid | Payout | ||||||
John L. Walsh | 160.0 | % | $ | 1,974,336 | ||||
Kirk R. Oliver | 160.0 | % | $ | 627,276 | ||||
Jerry E. Sheridan | 74.7 | % | $ | 302,834 | ||||
Monica M. Gaudiosi | 160.0 | % | $ | 437,102 | ||||
Bradley C. Hall | 192.5 | % | $ | 430,353 | ||||
| • | ||
Discretionary Bonus | ||
In November 2011,of 2014, the Committee andapproved a discretionary cash bonus to Ms. Gaudiosi in the independent membersamount of the UGI Board of Directors approved discretionary bonuses of (i) $50,000 to Mr. Walsh, and (ii) $60,000 to Mr. Knauss. Mr. Walsh’s$45,000. The discretionary bonus was awarded to Ms. Gaudiosi in recognition of his exceptional overall leadership, including serving as President and Chief Executive Officer of UGI Utilities, Inc. The discretionary bonus for Mr. Knauss was in recognition of hisher outstanding contributions and exceptional leadership efforts relating to acquisitions and other matters.
| • | Long-Term Compensation — Fiscal |
Background and Determination of Grants — Stock Options, Performance Units and Restricted Units
Our long-term incentive compensation is intended to create a strong financial incentive for achieving or exceeding long-term performance goals and to encourage executives to hold a significant equity stake in our companyCompany in order to align the executives’ interests with shareholder interests. Additionally, we believe our long-term incentives provide us the ability to attract and retain talented executives in a competitive market. We awarded our long-term compensation effective January 1, 2011 for Messrs. Greenberg, Walsh, Knauss and Bissell under the Company’s Amended and Restated 2004 Omnibus Equity Compensation Plan (the “2004 Plan”). Mr. Flexon also received long-term compensation, effective February 14, 2011, under the 2004 Plan, which he subsequently forfeited upon his resignation. In addition, Mr. Bissell received long-term compensation awards effective January 1, 2011 under the 2010 AmeriGas Propane, Inc. Long-Term Incentive Plan on behalf of AmeriGas Partners, L.P. (“AmeriGas 2010 Plan”). Mr. Varagne’s long-term compensation awards were made effective January 1, 2011 under the Sub-Plan for French Employees and Corporate Officers under the Company’s 2004 Plan.
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of the companies in the Adjusted Russell MidCap Utilities Index. Mr. BissellSheridan was awarded AmeriGas Partners performance unit awards tied to two different metrics: (i) the three-year total unitholder return performance of AmeriGas Partners common units relative to that of the entities in the Alerian MLP Index.Index, and (ii) the three-year total unitholder return performance of AmeriGas Partners common units relative to that of the other two retail propane distribution companies included in the Alerian MLP Index (the “Propane MLP Group”). Each performance unit represents the right of the recipient to receive a share of common stock or a common unit if specified performance goals and other conditions are met.
As is the case with cash compensation and annual bonus awards, we referenced Pay Governance’s analysis of executive compensation database information in establishing equity compensation for the named executive officers, except for Mr. Varagne, for whom such data was not available.officers. In determining the total dollar value of the long-term compensation opportunity to be provided in Fiscal 2011,2014, we initially referenced (i) median salary information, and (ii) the percentage of the market median base salary for each position to be delivered as acompetitive market-based long-term incentive compensation opportunity,information, both as calculated by Pay Governance. Pay Governance developed the percentages of base salary used to determine the amount of equity compensation based on the applicable executive compensation databases and such percentages were targeted to produce a long-term compensation opportunity at the 50th percentile level.
Except for Mr. Sheridan, we initially applied approximately 50 percent of the amount of the long-term incentive opportunity to stock options and approximately 50 percent to performance units. Because Mr. Sheridan is an executive officer employed by the General Partner, we initially applied approximately 35 percent of the amount of his long-term incentive opportunity to stock options and approximately 65 percent to AmeriGas performance units (of which 45 percent is applied to AmeriGas Partners performance compared to the Alerian MLP Index and 20 percent to AmeriGas Partners performance compared to the Propane MLP Group). We have bifurcated long-term compensation inbelieve this manner since 2000 and believe itbifurcation provides a good balance between two related, but discrete, goals. Stock options are designed to align the executive’s interests with shareholder interests, becauseBecause the value of stock options is a function of the appreciation or depreciation of our stock price.price, stock options are designed to align the executive’s interests with shareholder interests. As explained in more detail below, the performance units are designed to encourage increased total shareholder or unitholder return that compares favorably relative toover a competitive peer group.
For Fiscal 2014 equity awards, Pay Governance provided both the competitive market and UGI’sincentive levels based on its assessment of accounting values. Pay Governance then provided data for our long-term incentive values based upon a standardized “expected value” approach, which applied a binomial-lattice model for stock options. Under the binomial-lattice model, the value of a stock option equals the probability-weighted average of stock option gains at various points in time. However, in connection with its analysis of long-term incentive compensation, Pay Governance suggested that we consider an alternative approach to valuing long-term incentive awards by utilizing the accounting values. Accounting values are reported directly by companies to the survey databases. Those accounting valuesdatabases and are determined in accordance with GAAP.
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The adjustments generally resulted in (i) a decrease in the number of shares underlying options (with the exception of Mr. Hall, who received a slight increase), (ii) a decrease in the number of performance units awarded to Messrs. Walsh, Oliver and Sheridan, and (iii) a slight increase in the number of performance units awarded to Ms. Gaudiosi and Mr. Hall, in each case as compared to amounts calculated by Pay Governance using accounting values.
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compensation opportunity recommended by Pay Governance using the accounting values. The actual grant amounts based on the foregoing analysis are set forth below:
| Shares Underlying | ||||||||
| Stock Options | Performance Units | |||||||
| Name | # Granted | # Granted | ||||||
| Lon R. Greenberg | 300,000 | 70,000 | ||||||
| John L. Walsh | 125,000 | 28,000 | ||||||
| Eugene V. N. Bissell | 80,000 | 14,000 | (1) | |||||
François Varagne(2) | 50,000 | 15,000 | ||||||
| Robert H. Knauss | 57,000 | 11,000 | ||||||
Robert C. Flexon(3) | 75,000 | 15,000 | ||||||
Name | Shares Underlying Stock Options # Granted | Performance Units # Granted | ||||||
John L. Walsh | 405,000 | 63,000 | ||||||
Kirk R. Oliver | 116,250 | 19,500 | ||||||
Jerry E. Sheridan | 85,500 | 17,500 | (1) | |||||
Monica M. Gaudiosi | 75,000 | 12,750 | ||||||
Bradley C. Hall | 51,000 | 7,950 | ||||||
| (1) | Constitutes AmeriGas Partners performance units. | |
Peer Groups and Performance Metrics
While the number of performance units awarded to the named executive officers other than Mr. Varagne, was determined as described above, the actual number of shares or units underlying performance units that are paid out at the expiration of the three-year performance period will be based upon the Company’s comparative total shareholder return (“TSR”)TSR or AmeriGas Partners’ total unitholder return (“TUR”)Partners TUR over the period from January 1, 20112014 to December 31, 2013.2016. Specifically, with respect to the Company’sCompany performance units, we will compare the TSR of the Company’s common stock relative to the TSR performance of those companies comprising the Adjusted Russell MidCap Utilities Index as of the beginning of the performance period.period using the comparative returns methodology used by Bloomberg L.P. or its successor at the time of calculation. In computing TSR, the Company uses the average of the daily closing prices for its common stock and beginning with performance units granted in Fiscal
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| AGL Resources Inc. | FirstEnergy Corp. | Pepco Holdings, Inc. | ||
| Alliant Energy Corporation | Great Plains Energy Inc. | |||
| Ameren Corporation | Hawaiian Electric Industries, Inc. | |||
| American Water Works Company, Inc. | Integrys Energy Group, Inc. | Questar Corporation | ||
| Aqua America, Inc. | ITC Holdings Corp. | SCANA Corporation | ||
| Atmos Energy Corporation | MDU Resources Group, Inc. | Sempra Energy | ||
| Calpine Corporation | National Fuel Gas Company | TECO Energy, Inc. | ||
| Centerpoint Energy, Inc. | NiSource Inc. | The AES Corporation | ||
| CMS Energy Corporation | Northeast Utilities | |||
| Consolidated Edison, Inc. | NRG Energy, Inc. | |||
| Vectren Corporation | ||||
| DTE Energy Company | OGE Energy Corp. | |||
| Edison International | ONEOK, Inc. | |||
| Energen Corporation | ORMAT Technologies, Inc. | Xcel Energy Inc. |
The Company changed the peer group used to measure TSR from the S&P Utilities Index todetermined that the Adjusted Russell MidCap Utilities Index. Management recommended, and the Committee approved, this changeIndex is an appropriate peer group because the companies included in the Russell MidCap Utilities Index generally are more comparable to the Company in terms of market capitalization than the companies in the S&P Utilities Index. Moreover,and the Company is included in the Russell MidCap Utilities Index and is not included in the S&P Utilities Index. Additionally, based on the analysis provided by Pay Governance, there was no significant difference in the Company’s overall TSR ranking resulting from the change in index. The Company, uponwith approval of the Committee, excluded telecommunications companies from the peer group because the nature of the telecommunications business is markedly different from that of other companies in the utilities industry.
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The AmeriGas Compensation Committee approved a change to the long-term incentive plan design for the January 1, 2014 performance unit awards, after considering input from Pay Governance, to include a second relative total return metric. The Committee determined that the link between pay and performance would be strengthened by adding a second peer group comparing AmeriGas Partners TUR to the TUR of its two publicly traded retail propane distribution competitors, Ferrellgas Partners, L.P. (“FGP”) and Suburban Propane Partners, L.P. (“SPP”). FGP and SPP are the only other retail propane distribution companies included in the Alerian Index. The Committee believes that adding a second metric takes into account the operational and competitive perspectives unique to the propane segment of the MLP market.
| Alliance Holdings GP, L.P. | PAA Natural Gas Storage, L.P. | |||
| Alliance Resource | ||||
| Holly Energy Partners, L.P. | Penn Virginia Resource Partners, L.P. | |||
| Kinder Morgan Energy Partners, L.P. | Pioneer Southwest Energy Partners L.P. | |||
| Boardwalk Pipeline Partners, LP | Kinder Morgan Management, LLC | Plains All American Pipeline, L.P. | ||
| Buckeye Partners, L.P. | Legacy Reserves LP | Regency Energy Partners LP | ||
| Calumet Specialty Products Partners, L.P. | ||||
| Spectra Energy Partners, LP | ||||
| Suburban Propane Partners, L.P. | ||||
| Sunoco Logistics Partners L.P. | ||||
| El Paso Pipeline Partners, L.P. | TC PipeLines, LP | |||
| Enbridge Energy Management, L.L.C. | Targa Resources Partners LP | |||
| Enbridge Energy Partners, L.P. | Teekay LNG Partners L.P. | |||
| Teekay Offshore Partners L.P. | ||||
| Energy Transfer Partners, L.P. | NuStar Energy L.P. | |||
| Enterprise Products Partners L.P. | Nustar GP Holdings, LLC | |||
| EV Energy Partners, L.P. | ONEOK Partners, L.P. | Williams Partners L.P. | ||
| Ferrellgas Partners, L.P. |
For Company performance units tied to the Adjusted Russell Midcap Utilities Index, the minimum award, equivalent to 25 percent of the number of performance units, will be payable if the Company’s TSR rank is at the 25thpercentile of the Adjusted Russell MidCap Utilities Index. The target award, equivalent to 100 percent of the number of performance units, will be payable if the TSR rank is at the 50thpercentile. The maximum award, equivalent to 200 percent of the number of performance units, will be payable if the Company’s TSR rank is at the 90th percentile of the Adjusted Russell MidCap Utilities Index. The number of AmeriGas Partners common units underlying performance units tied to the Alerian MLP Index that will be paid out to Mr. Sheridan will be based upon AmeriGas Partners TUR rank relative to the Alerian MLP Index entities and is computed using a methodology analogous to that described above with regard to the Company’s TSR ranking.
With respect to AmeriGas Partners performance units tied to the Propane MLP Group, we will compare the TUR of AmeriGas Partners’ common units relative to the TUR performance of those entities comprising the Propane MLP Group using the comparative returns methodology used by Bloomberg L.P. or its successor at the time of calculation. In computing TUR, we will use the average price for the calendar quarter prior to January 1 of the beginning and end of a given three-year performance period. In addition, TUR gives effect to all distributions throughout the three-year performance period as if they had been reinvested. If one of the other two companies in the Propane MLP Group ceases to exist as a publicly traded company or declares
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bankruptcy (“Adjustment Event”) during the first year of the performance period, then the performance units tied to the Propane MLP Group will become payable at the end of the three-year performance period based on AmeriGas Partners TUR performance compared to the Alerian MLP Index. If an Adjustment Event occurs during the second year of the performance period, then the performance units will be tied (i) 50 percent to the Alerian MLP Index calculated through the end of the three-year performance period and (ii) 50 percent to the Propane MLP Group based on AmeriGas Partners TUR performance calculated using the average price for the 90 day period immediately preceding the first public announcement of the Adjustment Event. If an Adjustment Event occurs during the third year of the performance period, then the performance units tied to the Propane MLP Group will be payable based on AmeriGas Partners TUR performance compared to the performance of the Propane MLP Group calculated using the average price for the 90 day period immediately preceding the first public announcement of the Adjustment Event.
For the AmeriGas Partners performance units tied to the Propane MLP Group, no payout will occur unless AmeriGas Partners has the highest TUR for the performance period as compared to the other companies in the Propane MLP Group. The target and maximum award, equivalent to 150 percent of the number of performance units, will be payable if AmeriGas Partners has the highest TUR of the companies comprising the Propane MLP Group.
Each award payable to the named executive officers other than Mr. Varagne, provides a number of the Company’s shares or AmeriGas Partners’ common units equal to the number of performance units earned. After the Committee has determined that the conditions for payment have been satisfied, the Company or AmeriGas Propane, as the case may be, has the authority to provide for a cash payment to the named executives other than Mr. Varagne, in lieu of a limited number of the shares or common units payable. The cash payment is based on the value of the securities at the end of the performance period and is designed to meet minimum statutory tax withholding requirements. In the event that UGI executives earn shares in excess of the target award, the value of the shares earned in excess of the target is paid entirely in cash.
All performance units other than those held by Mr. Varagne, have dividend or distribution equivalent rights, as applicable. A dividend equivalent is an amount determined by multiplying the number of performance units credited to a recipient’s account by the per-share cash dividend or the per-share fair market value of any non-cash dividend paid by the Company during the performance period on Company shares on a dividend payment date. A distribution equivalent relates to AmeriGas Partners common units and is determined in a similar manner. Accrued dividend and distribution equivalents are payable in cash based on the number of common shares or AmeriGas Partners’ common units, if any, paid out at the end of the performance period.
Discretionary Award — Restricted Units
In addition to the performance units described above, the Compensation Committee of AmeriGas Propane and the Executive Committee of the AmeriGas Propane Board of Directors approved a discretionary award of AmeriGas Partners restricted units with distribution equivalents to certain individuals, including Mr. Sheridan. The restricted units were granted to those individuals who had previously been granted, and as of December 31, 2013 had not forfeited, performance units granted under the AmeriGas 2010 Plan for the performance period from January 1, 2011 to December 31, 2013 (“2011 Performance Units”). The 2011 Performance Units did not qualify for payout because AmeriGas Partners TUR did not satisfy the minimum threshold for payout during the performance period. The Committee granted the restricted units (i) in recognition of (a) AmeriGas Partners’ improved financial results over the 2011 to 2013 measurement period, and (b) the substantial progress made on key operational and organizational initiatives during the measurement period, and (ii) to motivate and retain Mr. Sheridan and other key executives of AmeriGas Propane. The Committee also considered the potential adverse effect on AmeriGas Partners’ common unit price resulting from Energy Transfer Partners, L.P.’s stated intent to divest AmeriGas Partners common units it had received as partial consideration for the Heritage Propane acquisition. At the time the 2011 Performance Units were granted, the Committee did not consider the potential impact of issuing common units as partial consideration for the Heritage Propane acquisition, including the extent and duration of such impact, on the price of AmeriGas Partners’ common units.
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| • | Long-Term Compensation — Payout of Performance Units for |
During Fiscal 2011,2014, we paid out awards to those executives who received UGI performance units in our 20082011 fiscal year covering the period from January 1, 20082011 to December 31, 2010.2013. For that period, the Company’s TSR ranked second20th relative to the 31other companies in the S&P Utilities Index, placing the Company slightly belowat the 9750th percentile ranking, resulting in a 191.9100 percent payout of the target award. AmeriGas Partners’Partners TUR ranked 636th relative to its peer group, of 19 other partnerships, placing AmeriGas Partners at approximatelybelow the 74thpercentile ranking, resulting inthreshold for a 147.8 percent payout of the target award. As a result of the Company’s TSR performance and AmeriGas Propane’s TUR performance, thefor Mr. Sheridan. The payouts duringfor Fiscal 20112014 on UGI performance unit awards were as follows:
| Performance Unit | Performance Unit | |||||||
| Name | Payout (#) | Payout Value(1) ($) | ||||||
| Lon R. Greenberg | 134,330 | $ | 4,578,638 | |||||
| John L. Walsh | 51,813 | $ | 1,766,046 | |||||
| Peter Kelly | 28,785 | $ | 981,137 | |||||
| Eugene V. N. Bissell | 17,736 | $ | 1,009,267 | |||||
| François Varagne | 17,751 | $ | 560,577 | |||||
| Robert H. Knauss | 17,271 | $ | 588,682 | |||||
Name | Performance Unit Payout (#)(1) | Performance Unit Payout Value(2) ($) | ||||||
John L. Walsh | 28,000 | $ | 1,250,970 | |||||
Kirk R. Oliver | 5,000 | $ | 214,238 | |||||
Monica M. Gaudiosi | 6,667 | $ | 289,265 | |||||
Bradley C. Hall | 7,000 | $ | 312,743 | |||||
| (1) | Because these performance units paid out in January 2014 prior to the 3-for-2 stock split effective September 5, 2014, the performance units in the above table have not been adjusted to reflect the stock split. |
| (2) | Includes dividend equivalent |
| • | Perquisites and Other Compensation |
We provide limited perquisite opportunities to our executive officers. We provide reimbursement for tax preparation services (discontinued in Fiscal 2011 for newly hired executives) and limited spousal travel. Our named executive officers may also occasionally use the Company’s tickets for sporting events for personal rather than business purposes. In addition, Mr. Varagne had a company car. The aggregate cost of perquisites for all named executive officers in Fiscal 20112014 was less than $60,000.
| • | Other Benefits |
Our named executive officers participate in various retirement, pension, deferred compensation and severance plans, which are described in greater detail in theOngoing Plans and Post-Employment Agreements section of thisCompensation Discussion and Analysis.Analysis. We also provide employees, including the named executive officers, with a variety of other benefits, including medical and dental benefits, disability benefits, life insurance, and paid time off for holidays and vacations. These benefits generally are available to all of our full-time employees, although AmeriGas Propane provided certain enhanced disability and life insurance benefits to its senior executives, which for Mr. Bissell havingSheridan had a total cost in Fiscal 20112014 of less than $5,000.
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Retirement Income Plan for Employees of UGI Utilities, Inc. (the “UGI Pension Plan”)
This plan is a tax-qualified defined benefit plan available to, among others, employees of the Company and certain of its subsidiaries. The UGI Pension Plan was closed to new participants as of January 1, 2009. The
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UGI Pension Plan provides an annual retirement benefit based on an employee’s earnings and years of service, subject to maximum benefit limitations. Messrs. Greenberg, Walsh and KnaussHall participate in the UGI Pension Plan; Mr. Bissell has a vested benefit, but he no longer participates.Plan. SeeCompensation of Executive Officers COMPENSATION OF EXECUTIVE OFFICERS — Pension Benefits Table — Fiscal 20112014 and accompanying narrative for additional information.
UGI Utilities, Inc. Savings Plan (the “UGI Savings Plan”)
This plan is a tax-qualified defined contribution plan available to, among others, employees of the Company. Under the plan, an employee may contribute, subject to Internal Revenue Code (the “Code”) limitations (which, among other things, limited annual contributions in 20112014 to $16,500)$17,500), up to a maximum of 50 percent of his or her eligible compensation on a pre-tax basis and up to 20 percent of his or her eligible compensation on an after-tax basis. The combined maximum of pre-tax and after-tax contributions is 50 percent of his or her eligible compensation. The Company provides matching contributions targeted at 50 percent of the first 3 percent of eligible compensation contributed by the employee in any pay period, and 25 percent of the next 3 percent. For participants entering the UGI Savings Plan on or after January 1, 2009 who are not eligible to participate in the UGI Pension Plan, the Company provides matching contributions targeted at 100 percent of the first 5 percent of eligible compensation contributed by the employee in any pay period. Amounts credited to an employee’s account in the plan may be invested among a number of funds, including the Company’s stock fund. Messrs. Greenberg, Walsh, Oliver and KnaussHall and Ms. Gaudiosi are eligible to participate in the UGI Savings Plan.
AmeriGas Propane, Inc. Savings Plan (the “AmeriGas Savings Plan”)
This plan is a tax-qualified defined contribution plan for AmeriGas Propane employees. Subject to Code limits, which are the same as described above with respect to the UGI Savings Plan, an employee may contribute, on a pre-tax basis, up to 50 percent of his or her eligible compensation, and AmeriGas Propane provides a matching contribution equal to 100 percent of the first 5 percent of eligible compensation contributed in any pay period. Like the UGI Savings Plan, participants in the AmeriGas Savings Plan may invest amounts credited to their account among a number of funds, including the Company’s stock fund. Mr. BissellSheridan is eligible to participate in the AmeriGas Savings Plan.
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UGI Corporation Supplemental Executive Retirement Plan
This plan is a nonqualified defined benefit plan that provides retirement benefits that would otherwise be provided under the UGI Pension Plan to employees hired prior to January 1, 2009, but are prohibited from being paid from the UGI Pension Plan by Code limits. The plan also provides additional benefits in the event of certain terminations of employment covered by a change in control agreement. Messrs. Greenberg, Walsh and KnaussHall participate in the UGI Corporation Supplemental Executive Retirement Plan. SeeCompensation of Executive Officers COMPENSATION OF EXECUTIVE OFFICERS — Pension Benefits Table — Fiscal 20112014 and accompanying narrative for additional information.
UGI Corporation Supplemental Savings Plan
This plan is a nonqualified deferred compensation plan that provides benefits that would be provided under the qualified UGI Savings Plan to employees hired prior to January 1, 2009 in the absence of Code limitations. The Supplemental Savings Plan is intended to pay an amount substantially equal to the difference between the Company matching contribution to the qualified UGI Savings Plan and the matching contribution that would have been made under the qualified UGI Savings Plan if the Code limitations were not in effect. At the end of each plan year, a participant’s account is credited with earnings equal to the weighted average return on two indices: 60 percent on the total return of the Standard and Poor’s 500 Index and 40 percent on the total return of the Barclays Capital U.S. Aggregate Bond Index. The plan also provides additional benefits in the event of certain terminations of employment covered by a change in control agreement. Messrs. Greenberg, Walsh and KnaussHall are each eligible to participate in the UGI Corporation Supplemental
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Savings Plan. SeeCompensation of Executive Officers COMPENSATION OF EXECUTIVE OFFICERS — Nonqualified Deferred Compensation Table — Fiscal 20112014 and accompanying narrative for additional information.
2009 UGI Corporation Supplemental Executive Retirement Plan for New Employees
The 2009 UGI Corporation Supplemental Executive Retirement Plan for New Employees (the “2009 UGI SERP”) is a nonqualified deferred compensation plan that is intended to provide retirement benefits to executive officers who are not eligible to participate in the UGI Pension Plan, having commenced employment with UGI on or after January 1, 2009. Under the 2009 UGI SERP, the Company credits to each participant’s account annually an amount equal to 5 percent of the participant’s compensation (salary and annual bonus) up to the Code compensation limit ($245,000255,000 in 2011)2014) and 10 percent of compensation in excess of such limit. In addition, if any portion of the Company’s matching contribution under the UGI Savings Plan is forfeited due to nondiscrimination requirements under the Code, the forfeited amount, adjusted for earnings and losses on the amount, will be credited to a participant’s account. Participants direct the investment of their account balances among a number of mutual funds, which are generally the same funds available to participants in the UGI Savings Plan, other than the UGI stock fund. Mr. Oliver and Ms. Gaudiosi are eligible to participate in the 2009 UGI SERP. SeeCompensation of Executive Officers COMPENSATION OF EXECUTIVE OFFICERS — Pension Benefits Table — Fiscal 20112014 and accompanying narrative for additional information.
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AmeriGas Propane maintains a supplemental executive retirement plan, which is a nonqualified deferred compensation plan for highly compensated employees of AmeriGas Propane. Under the plan, AmeriGas Propane credits to each participant’s account annually an amount equal to 5 percent of the participant’s compensation up to the Code compensation limits and 10 percent of compensation in excess of such limit. In addition, if any portion of AmeriGas Propane’s matching contribution under the AmeriGas Savings Plan is forfeited due to nondiscrimination requirements under the Code, the forfeited amount, adjusted for earnings and losses on the amount, will be credited to a participant’s account. Participants direct the investment of the amounts in their accounts among a number of mutual funds. Mr. BissellSheridan participates in the AmeriGas Propane, Inc. Supplemental Executive Retirement Plan. SeeCompensation of Executive Officers COMPENSATION OF EXECUTIVE OFFICERS — Nonqualified Deferred Compensation Table — Fiscal 20112014 and accompanying narrative for additional information.
AmeriGas Propane, Inc. Nonqualified Deferred Compensation Plan
AmeriGas Propane maintains a nonqualified deferred compensation plan under which participants may defer up to $10,000 of their annual compensation. Deferral elections are made annually by eligible participants in respect of compensation to be earned for the following year. Participants may direct the investment of deferred amounts into a number of mutual funds. Payment of amounts accrued for the account of a participant generally is made following the participant’s termination of employment. Mr. BissellSheridan is eligible to participate in the AmeriGas Propane, Inc. Nonqualified Deferred Compensation Plan. SeeCompensation of Executive Officers COMPENSATION OF EXECUTIVE OFFICERS — Nonqualified Deferred Compensation Table — Fiscal 20112014 and accompanying narrative for additional information.
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This plan provides deferral options that comply with the requirements of Section 409A of the Code related to (i) all stock units and phantom units granted to the Company’s and AmeriGas Propane’s non-employee Directors, (ii) benefits payable under the UGI Corporation Supplemental Executive Retirement Plan, (iii) the 2009 UGI Corporation SERP, and (iv) benefits payable under the AmeriGas Propane, Inc. Supplemental Executive Retirement Plan. If an eligible participant elects to defer payment under the plan, the participant may receive future benefits after separation from service as (i)(x) a lump sum payment, (ii)(y) annual installment payments over a period between two and ten years, or (iii)(z) one to five retirement distribution accountsamounts to be paid in a lump sum in the year specified by the individual. Deferred benefits, other than stock units and
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phantom units, will be deemed to be invested in investment funds selected by the participant from among a list of available funds. Messrs. Greenberg, Walsh, Knauss and Bissell elected to defer benefits under this plan. The plan also provides newly eligible participants with a deferral election that must be acted upon promptly.
Severance Pay Plans for Senior Executive Employees
The Company and AmeriGas Propane each maintain a severance pay plan that provides severance compensation to certain senior level employees. The plans are designed to alleviate the financial hardships that may be experienced by executive employee participants whose employment is terminated without just cause, other than in the event of death or disability. The Company’s plan covers Messrs. Greenberg, Walsh, Oliver and Knauss,Hall and Ms. Gaudiosi, and the AmeriGas Propane plan covers Mr. Bissell.Sheridan. SeeCompensation of Executive Officers COMPENSATION OF EXECUTIVE OFFICERS — Potential Payments Upon Termination or Change in Control for further information regarding the severance plans.
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The Company has change in control agreements with Messrs. Greenberg, Walsh, Oliver and Knauss,Hall and Ms. Gaudiosi, and AmeriGas Propane has a change in control agreement with Mr. Bissell.Sheridan. The change in control agreements are designed to reinforce and encourage the continued attention and dedication of the executives without distraction in the face of potentially disturbing circumstances arising from the possibility of the change in control and to serve as an incentive to their continued employment with us. The agreements provide for payments and other benefits if we terminate an executive’s employment without cause or if the executive terminates employment for good reason within two years following a change in control of the Company (and, in the case of Mr. Bissell,Sheridan, AmeriGas Propane or AmeriGas Partners). The agreements also provide that if change in control payments exceed certain threshold amounts, we will make additional payments to reimburse the executives for excise and related taxes imposed under the Code. SeeCompensation of Executive Officers COMPENSATION OF EXECUTIVE OFFICERS — Potential Payments Upon Termination or Change in Control for further information regarding the change in control agreements.
We seek to align executives’ interests with shareholder and unitholder interests through our equity ownership guidelines. We believe that by encouraging our executives to maintain a meaningful equity interest in the Company or, if applicable, AmeriGas Partners, we will enhance the link between our executives and stockholders or unitholders. Under our guidelines, an executive must meet 10 percent of the ownership requirement within one year from the date of employment or promotionpromotion. The UGI Bonus Plan and must usethe AmeriGas Bonus Plan each provides that, unless the Committee determines otherwise, all executive officers who have not fulfilled their equity ownership requirement receive up to 10 percent of histheir gross annual bonus award to purchasein fully vested UGI Corporation stock (or, in the case of Messrs. Bissell and Knauss, partnershipor AmeriGas Partners common units or stock) until his share ownership requirement is met.units. In addition, the guidelines require that 50 percent of the net proceeds from a “cashless exercise” of stock options be used to purchase stock until the ownership requirement is met. The guidelines also require that, until the share ownership requirement is met, the executive retain all shares or common units received in connection with the payout of performance units. Up to 20 percent of the ownership requirement may be satisfied through holdings of UGI common stock in the executive’s account in the relevant savings plan.
As of September 30, 2014, the equity ownership requirements for the named executive officers were as follows: (1) Mr. BissellWalsh – 225,000 shares; (2) Mr. Oliver – 50,000 shares; (3) Ms. Gaudiosi – 30,000 shares; and (4) Mr. Hall – 30,000 shares. Mr. Sheridan is permitted to satisfy his requirements through ownership of UGI common stock, AmeriGas Partners common units, or a combination of UGI common stock and AmeriGas Partners common units, with each AmeriGas Partners common unit equivalent to 1.5 shares of UGI common stock. The stock ownership guidelines further permit any Company executive who was formerly employed by AmeriGas Propane, such as Mr. Knauss, to satisfy up to two-thirds of his or her stockSheridan’s ownership requirement withis 60,000 shares of UGI Corporation common stock or 40,000 AmeriGas Partners common units.
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STOCK OPTION GRANT PRACTICES
| Required | Number of Shares of | Number of | ||||||||||
| Ownership of UGI | UGI Corporation | AmeriGas Partners | ||||||||||
| Corporation | Common Stock Held | Common Units Held | ||||||||||
| Name | Common Stock(1) | at 9/30/2011 | at 9/30/2011 | |||||||||
| Lon R. Greenberg | 250,000 | 405,872 | 11,000 | |||||||||
| John L. Walsh | 100,000 | 126,253 | 7,000 | |||||||||
| Eugene V.N. Bissell | 60,000 | 67,297 | 60,800 | |||||||||
| François Varagne | 30,000 | 42,239 | 0 | |||||||||
| Robert H. Knauss | 30,000 | 10,105 | (2) | 14,108 | ||||||||
ROLE OF EXECUTIVE OFFICERS IN DETERMINING EXECUTIVE COMPENSATION
In connection with Fiscal 20112014 compensation, Mr. Greenberg,Walsh, aided by our corporate human resources personnel,department, provided statistical data and recommendations to the appropriate Committee to assist it in determining compensation levels. Mr. GreenbergWalsh did not make recommendations as to his own compensation and was excused from the Committee meeting when his compensation was discussed by the Committee. While the Committees utilized information provided by Mr. Greenberg,Walsh, and valued Mr. Greenberg’sWalsh’s observations with regard to other executive officers, the ultimate decisions regarding executive compensation were made by the Committee for all named executive officers, except Messrs. Walsh and Sheridan, for whom executive compensation decisions were made by the independent members of the appropriate Board of Directors following Committee recommendations.
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| COMPENSATIONOF EXECUTIVE OFFICERS |
| Change in Pension | ||||||||||||||||||||||||||||||||||||
| Value and | ||||||||||||||||||||||||||||||||||||
| Option | Non-Equity | Nonqualified | ||||||||||||||||||||||||||||||||||
| Stock Awards | Awards | Incentive | Deferred | All Other | ||||||||||||||||||||||||||||||||
| Name and Principal | Fiscal | Salary | Bonus | ($) | ($) | Plan Compensation | Compensation | Compensation | Total | |||||||||||||||||||||||||||
| Position | Year | ($)(1) | ($) | (2) | (2) | ($)(3) | Earnings ($)(4) | ($)(5) | ($) | |||||||||||||||||||||||||||
| (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | |||||||||||||||||||||||||||
| Lon R. Greenberg | 2011 | 1,099,047 | 0 | 2,479,400 | 1,629,000 | 1,072,821 | 3,258,787 | 62,162 | 9,601,217 | |||||||||||||||||||||||||||
| Chairman and Chief | 2010 | 1,067,500 | 0 | 1,590,400 | 1,347,000 | 1,145,428 | 1,971,422 | 69,853 | 7,191,603 | |||||||||||||||||||||||||||
| Executive Officer | 2009 | 1,067,975 | 0 | 1,957,200 | 1,218,000 | 1,591,643 | 2,640,022 | 65,416 | 8,540,256 | |||||||||||||||||||||||||||
| John L. Walsh | 2011 | 674,040 | 50,000 | (7) | 991,760 | 678,750 | 508,494 | 376,855 | 28,023 | 3,307,922 | ||||||||||||||||||||||||||
| President, Chief Operating | 2010 | 648,440 | 0 | 636,160 | 561,250 | 591,410 | 377,873 | 33,081 | 2,848,214 | |||||||||||||||||||||||||||
| Officer and Principal Financial Officer | 2009 | 648,202 | 0 | 782,880 | 507,500 | 821,800 | 330,768 | 25,979 | 3,117,129 | |||||||||||||||||||||||||||
| Peter Kelly | 2011 | 167,917 | 0 | 0 | 0 | 0 | 0 | 756 | 168,673 | |||||||||||||||||||||||||||
| Former Vice President-Finance and | 2010 | 426,400 | 0 | 386,240 | 345,730 | 343,145 | 190,697 | 20,323 | 1,712,535 | |||||||||||||||||||||||||||
| Chief Financial Officer(6) | 2009 | 426,240 | 0 | 475,320 | 284,200 | 476,822 | 134,986 | 5,989 | 1,803,557 | |||||||||||||||||||||||||||
| Robert C. Flexon | 2011 | 191,835 | 0 | 2,137,759 | 407,250 | 0 | 0 | 0 | 2,736,844 | |||||||||||||||||||||||||||
| Former Chief Financial Officer(6) | ||||||||||||||||||||||||||||||||||||
| Eugene V. N. Bissell | 2011 | 520,936 | 0 | 763,140 | 434,400 | 290,000 | 451 | 81,094 | 2,090,021 | |||||||||||||||||||||||||||
| President and Chief Executive | 2010 | 490,006 | 0 | 715,700 | 359,200 | 349,664 | 3,778 | 85,475 | 2,003,823 | |||||||||||||||||||||||||||
| Officer of AmeriGas Propane, Inc. | 2009 | 487,820 | 0 | 643,400 | 304,500 | 450,800 | 5,943 | 97,151 | 1,989,614 | |||||||||||||||||||||||||||
| Robert H. Knauss | 2011 | 360,462 | 60,000 | (8) | 389,620 | 309,510 | 208,005 | 380,145 | 13,906 | 1,721,648 | ||||||||||||||||||||||||||
| Vice President and | 2010 | 340,340 | 45,000 | (9) | 249,920 | 255,930 | 237,370 | 389,944 | 14,872 | 1,533,376 | ||||||||||||||||||||||||||
| General Counsel | 2009 | 340,146 | 0 | 602,040 | 203,000 | 329,841 | 455,185 | 13,594 | 1,943,806 | |||||||||||||||||||||||||||
| François Varagne | 2011 | 469,000 | 0 | 240,450 | 271,500 | 300,957 | 48,063 | 49,483 | 1,379,453 | |||||||||||||||||||||||||||
| Chairman and | 2010 | 455,600 | 0 | 189,440 | 255,930 | 324,661 | 159,952 | 48,936 | 1,434,519 | |||||||||||||||||||||||||||
| Chief Executive Officer | 2009 | 452,250 | 0 | 234,210 | 268,470 | 252,493 | 62,170 | 34,185 | 1,303,778 | |||||||||||||||||||||||||||
| Antargaz (10) | ||||||||||||||||||||||||||||||||||||
| Summary Compensation Table – Fiscal 2014 | ||||||||||||||||||||||||||||||||||||
Name and Principal Position | Fiscal Year | Salary ($)(1) | Bonus ($) | Stock Awards ($)(2) | Option Awards ($)(2) | Non-Equity Incentive Plan Compensation | Change in Pension Nonqualified Deferred Compensation Earnings ($)(4) | All Other Compensation ($)(5) | Total ($) | |||||||||||||||||||||||||||
| (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | ||||||||||||||||||||||||||||
J. L. Walsh President and Chief Executive Officer | 2014 2013 2012 | 1,027,169 856,377 701,470 | 0 0 0 | 2,053,380 1,877,710 760,500 | 1,992,060 1,060,319 543,065 | 1,974,336 902,454 413,478 | 1,009,878 481,670 651,008 | 41,037 27,262 27,985 | 8,097,860 5,205,792 3,097,506 | |||||||||||||||||||||||||||
K. R. Oliver Chief Financial Officer | 2014 2013 | 522,552 505,096 | 0 0 | 635,570 1,019,190 | (6) | 571,795 437,813 | 627,276 370,414 | 0 0 | 115,233 172,016 | 2,472,426 2,504,529 | ||||||||||||||||||||||||||
J. E. Sheridan President and Chief Executive Officer of AmeriGas Propane, Inc. | 2014 2013 2012 | 506,018 474,539 410,220 | 0 0 0 | 866,967 678,156 603,500 | (7) (8) | 420,546 338,366 305,110 | 302,834 255,371 0 | 0 0 0 | 110,391 76,241 48,587 | 2,206,756 1,822,673 1,367,417 | ||||||||||||||||||||||||||
M. M. Gaudiosi Vice President, General Counsel and Secretary | 2014 2013 2012 | 420,007 407,890 169,246 | 45,000 0 0 | 415,565 382,700 244,167 | 368,900 237,450 193,206 | 437,102 234,789 120,011 | 0 0 0 | 85,545 61,812 172,503 | 1,772,119 1,324,641 899,133 | |||||||||||||||||||||||||||
B. C. Hall President of UGI Enterprises, Inc. | 2014 2013 2012 | 372,269 357,712 329,659 | 0 0 0 | 259,117 229,620 204,750 | 250,852 199,458 182,470 | 430,353 181,420 0 | 791,098 276,833 341,177 | 12,322 7,673 10,443 | 2,116,011 1,252,716 1,068,499 | |||||||||||||||||||||||||||
| (1) | The amounts shown in column (c) represent salary payments actually received during the fiscal year shown based on the number of pay periods within such fiscal year. Mr. Walsh’s Fiscal 2013 salary reflects the portion of Fiscal 2013 that he served as President and Chief Operating Officer (until April 1, 2013) as well as his promotion to President and Chief Executive Officer (effective April 1, 2013). |
| (2) | The amounts shown in columns (e) and (f) |
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| (3) | The amounts shown in this column represent payments made under the applicable performance-based annual bonus plan. Mr. Oliver and Ms. Gaudiosi received 10% of their respective payouts in UGI Corporation common stock in compliance with the Company’s ongoing stock ownership requirements. | |
| (4) | The amounts shown in column (h) of the Summary Compensation Table |
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market-based, and calculated in the same manner and at the same rate as earnings on externally managed investments available in a broad-based qualified plan. The amounts included in column (h) of the Summary Compensation Table |
| Change in | Above-Market | |||||||
| Pension | Earnings on | |||||||
| Value | Deferred Compensation | |||||||
| Name | ($) | ($) | ||||||
| L.R. Greenberg | 3,209,463 | 49,324 | ||||||
| J.L. Walsh | 369,263 | 7,592 | ||||||
| P. Kelly | 0 | 0 | ||||||
| R.C. Flexon | 0 | 0 | ||||||
| E.V.N. Bissell | 451 | 0 | ||||||
| R.H. Knauss | 377,395 | 2,750 | ||||||
| F. Varagne | 48,063 | 0 | ||||||
| Name | Change in Pension Value ($) | Above-Market Earnings on Deferred Compensation ($) | ||||||
John L. Walsh | 969,343 | 40,535 | ||||||
Kirk R. Oliver | 0 | 0 | ||||||
Jerry E. Sheridan | 0 | 0 | ||||||
Monica M. Gaudiosi | 0 | 0 | ||||||
Bradley C. Hall | 779,054 | 12,044 | ||||||
| (5) | The table below shows the components of the amounts included for each named executive officer under column (i), All Other Compensation, in the Summary Compensation Table |
| Name | Employer Contribution to 401(k) Savings Plan ($) | Employer Contribution to UGI Supplemental Savings Plan and 2009 Supplemental Executive Retirement Plan for New Employees; AmeriGas Propane, Inc. Supplemental Executive Retirement Plan ($) | Discretionary ($) | Total ($) | ||||||
John L. Walsh | 5,732 | 35,305 | 0 | 41,037 | ||||||
Kirk R. Oliver | 13,000 | 102,233 | 0 | 115,233 | ||||||
Jerry E. Sheridan | 13,000 | 68,135 | 29,256 | 110,391 | ||||||
Monica M. Gaudiosi | 8,083 | 77,461 | 0 | 85,545 | ||||||
Bradley C. Hall | 5,850 | 6,472 | 0 | 12,322 | ||||||
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| Employer | ||||||||||||||||
| Contribution | ||||||||||||||||
| To UGI | ||||||||||||||||
| Supplemental | ||||||||||||||||
| Savings Plan; | ||||||||||||||||
| AmeriGas Propane, | ||||||||||||||||
| Employer | Inc. Supplemental | |||||||||||||||
| Contribution | Executive | |||||||||||||||
| to | Retirement Plan; | |||||||||||||||
| 401(k) | Antargaz Defined | |||||||||||||||
| Savings Plan | Contribution Plan | Perquisites | Total | |||||||||||||
| Name | ($) | ($) | ($) | ($) | ||||||||||||
| L.R. Greenberg | 5,513 | 44,434 | 12,215 | 62,162 | ||||||||||||
| J.L. Walsh | 5,513 | 22,510 | 0 | 28,023 | ||||||||||||
| P. Kelly | 756 | 0 | 0 | 756 | ||||||||||||
| R.C. Flexon | 0 | 0 | 0 | 0 | ||||||||||||
| E.V.N. Bissell | 12,250 | 68,844 | 0 | 81,094 | ||||||||||||
| R.H. Knauss | 5,308 | 8,598 | 0 | 13,906 | ||||||||||||
| F. Varagne | N/A | 14,032 | 35,451 | 49,483 | ||||||||||||
| (6) | Includes 15,000 UGI performance units granted effective October 1, 2012 in connection with the commencement of Mr. Oliver’s employment. |
| (7) | Includes 3,189 AmeriGas Partners restricted units awarded to Mr. Sheridan during Fiscal 2014. See Compensation Discussion & Analysis and the Grants of Plan-Based Awards Table – Fiscal 2014 for more information on Mr. Sheridan’s award. |
| (8) | Includes 1,821 AmeriGas Partners phantom units with distribution equivalents awarded to Mr. |
Discretionary bonus awarded to Ms. Gaudiosi in recognition of | ||
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The following table and footnotes provide information regarding equity and non-equity plan grants to the named executive officers in Fiscal 2011.
| All | ||||||||||||||||||||||||||||||||||||||||||||||||
| Other | All Other | |||||||||||||||||||||||||||||||||||||||||||||||
| Estimated Possible Payouts | Stock | Option | ||||||||||||||||||||||||||||||||||||||||||||||
| Under | Estimated Future Payouts | Awards: | Awards: | Exercise | Grant Date | |||||||||||||||||||||||||||||||||||||||||||
| Non-Equity Incentive Plan | Under Equity Incentive Plan | Number | Number of | or Base | Fair Value | |||||||||||||||||||||||||||||||||||||||||||
| Awards (1) (4) | Awards (2) | of Shares | Securities | Price of | of Stock and | |||||||||||||||||||||||||||||||||||||||||||
| Board | Thres- | Thres- | of Stock | Underlying | Option | Option | ||||||||||||||||||||||||||||||||||||||||||
| Grant | Action | hold | Target | Maximum | hold | Target | Maximum | or Units | Options | Awards | Awards | |||||||||||||||||||||||||||||||||||||
| Name | Date | Date | ($) | ($) | ($) | (#) | (#) | (#) | (#) | (#) (3) | ($/Sh) | ($) | ||||||||||||||||||||||||||||||||||||
| (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | (k) | (l) | (m) | ||||||||||||||||||||||||||||||||||||
| L.R. Greenberg | 10/01/10 | 11/19/10 | 725,696 | 1,209,494 | 2,418,988 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/11 | 11/19/10 | 0 | 300,000 | 31.58 | 1,629,000 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/11 | 11/19/10 | 35,000 | 70,000 | 140,000 | 2,479,400 | |||||||||||||||||||||||||||||||||||||||||||
| J.L. Walsh | 10/01/10 | 11/19/10 | 343,964 | 573,274 | 1,146,548 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/11 | 11/19/10 | 0 | 125,000 | 31.58 | 678,750 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/11 | 11/19/10 | 14,000 | 28,000 | 56,000 | 991,760 | |||||||||||||||||||||||||||||||||||||||||||
| P. Kelly | 10/01/10 | 11/19/10 | 196,654 | 327,756 | 655,512 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||
| R.C. Flexon | 02/14/11 | 01/18/11 | 142,506 | 237,510 | 475,020 | |||||||||||||||||||||||||||||||||||||||||||
| 02/14/11 | 01/18/11 | 0 | 75,000 | 31.86 | 407,250 | |||||||||||||||||||||||||||||||||||||||||||
| 02/14/11 | 01/18/11 | 2,500 | 5,000 | 10,000 | 183,100 | |||||||||||||||||||||||||||||||||||||||||||
| 02/14/11 | 01/18/11 | 5,000 | 10,000 | 20,000 | 371,100 | |||||||||||||||||||||||||||||||||||||||||||
| 02/14/11 | 01/18/11 | 7,500 | 15,000 | 30,000 | 531,300 | |||||||||||||||||||||||||||||||||||||||||||
| 02/14/11 | 01/18/11 | 30,000 | 1,052,259 | |||||||||||||||||||||||||||||||||||||||||||||
| E.V.N. Bissell | 10/01/10 | 11/19/10 | 241,088 | 401,814 | 803,628 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/11 | 11/19/10 | 0 | 80,000 | 31.58 | 434,400 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/11 | 11/19/10 | 7,000 | 14,000 | 28,000 | 763,140 | |||||||||||||||||||||||||||||||||||||||||||
| R.H. Knauss | 10/01/10 | 11/19/10 | 140,702 | 234,504 | 469,008 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/11 | 11/19/10 | 0 | 57,000 | 31.58 | 309,510 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/11 | 11/19/10 | 5,500 | 11,000 | 22,000 | 389,620 | |||||||||||||||||||||||||||||||||||||||||||
| F. Varagne | 10/01/10 | 11/19/10 | 229,810 | 328,300 | 656,600 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/11 | 11/19/10 | 0 | 50,000 | 31.58 | 271,500 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/11 | 11/19/10 | 7,500 | 15,000 | 15,000 | 240,450 | |||||||||||||||||||||||||||||||||||||||||||
| Grants of Plan-Based Awards Table – Fiscal 2014 | ||||||||||||||||||||||||||||||||||||||||||||||||
Estimated Possible Payouts Non-Equity Incentive Plan
| Estimated Future Payouts
| All Other | All Other Option Awards: Number of Securities | Exercise or Base Price of | Grant Date Fair Value of Stock and | |||||||||||||||||||||||||||||||||||||||||||
| Name | Grant Date | Board Action Date | Thres- hold ($) | Target ($) | Maximum ($) | Thres- hold | Target (#) | Maximum (#) | of Stock or Units (#) (3) | Underlying (#) (4) | Option Awards ($/Sh) | Option ($) | ||||||||||||||||||||||||||||||||||||
| (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | (k) | (l) | (m) | ||||||||||||||||||||||||||||||||||||
J. L. Walsh | 10/01/13 | 11/21/13 | 740,376 | 1,233,960 | 2,467,920 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | 405,000 | 27.64 | 1,992,060 | ||||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | 15,750 | 63,000 | 126,000 | 2,053,380 | |||||||||||||||||||||||||||||||||||||||||||
K. R. Oliver | 10/01/13 | 11/21/13 | 235,229 | 392,048 | 784,095 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | 116,250 | 27.64 | 571,795 | ||||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | 4,875 | 19,500 | 39,000 | 635,570 | |||||||||||||||||||||||||||||||||||||||||||
J. E. Sheridan | 10/01/13 | 11/21/13 | 209,592 | 405,400 | 810,800 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | 85,500 | 27.64 | 420,546 | ||||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | 2,375 | 9,500 | 19,000 | 497,420 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | (5 | ) | 8,000 | 12,000 | 233,440 | ||||||||||||||||||||||||||||||||||||||||||
| 01/16/14 | 01/16/14 | 2,133 | 91,036 | |||||||||||||||||||||||||||||||||||||||||||||
| 01/16/14 | 01/16/14 | 1,056 | 45,070 | |||||||||||||||||||||||||||||||||||||||||||||
M. M. Gaudiosi | 10/01/13 | 11/21/13 | 163,913 | 273,189 | 546,377 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | 75,000 | 27.64 | 368,900 | ||||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | 3,187 | 12,750 | 25,500 | 415,565 | |||||||||||||||||||||||||||||||||||||||||||
B. C. Hall | 10/01/13 | 11/21/13 | 130,783 | 223,560 | 430,353 | |||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | 51,000 | 27.64 | 250,852 | ||||||||||||||||||||||||||||||||||||||||||||
| 01/01/14 | 11/21/13 | 1,987 | 7,950 | 15,900 | 259,177 | |||||||||||||||||||||||||||||||||||||||||||
-54-
| (1) | The amounts shown under this heading relate to bonus opportunities under the relevant company’s annual bonus plan for Fiscal | |
| (2) | The awards shown for |
The awards shown for Mr. Sheridan are performance units under the AmeriGas 2010 Plan, as described in the Compensation Discussion and Analysis. Terms of these awards with respect to forfeitures and change in control, as defined in the AmeriGas 2010 Plan, are fashioned in a similar manner to the terms of the performance units granted under the Company’s 2013 Plan.
- 43 -
| (3) | ||
The awards shown for Mr. Sheridan are | ||
-55-
| (4) | ||
Options are granted under the Company’s | ||
| (5) | There is no threshold with respect to Mr. Sheridan’s AmeriGas Partners performance units tied to the Propane MLP Group. |
-56-
- 44 -
The following table shows the outstanding stock option and performance unit awards held by the named executive officers at September 30, 2011.
| Option Awards | Stock Awards | |||||||||||||||||||||||||||||||
| Equity | ||||||||||||||||||||||||||||||||
| Incentive | ||||||||||||||||||||||||||||||||
| Plan Awards: | ||||||||||||||||||||||||||||||||
| Number | Market | Number of | Equity Incentive | |||||||||||||||||||||||||||||
| Number of | of Shares | Value of | Unearned | Plan Awards: | ||||||||||||||||||||||||||||
| Securities | Number of | or Units | Shares or | Shares, Units | Market or Payout | |||||||||||||||||||||||||||
| Underlying | Securities | of Stock | Units of | or Other | Value of Unearned | |||||||||||||||||||||||||||
| Unexercised | Underlying | Option | That Have | Stock That | Rights That | Shares, Units or | ||||||||||||||||||||||||||
| Options | Options | Exercise | Option | Not | Have Not | Have Not | Other Rights That | |||||||||||||||||||||||||
| Exercisable | Unexercisable | Price | Expiration | Vested | Vested | Vested | Have Not Vested | |||||||||||||||||||||||||
| Name | (#) | (#) | ($) | Date | (#) | ($) | (#) | ($) | ||||||||||||||||||||||||
| (a) | (b) | (c) | (e) | (f) | (g) | (h) | (i) | (j) | ||||||||||||||||||||||||
| L.R. Greenberg | ||||||||||||||||||||||||||||||||
| 15,000 | (1) | 16.99 | 12/31/2013 | 0 | 0 | 70,000 | 0 | (18) | ||||||||||||||||||||||||
| 350,000 | (2) | 20.47 | 12/31/2014 | 70,000 | (19) | 1,838,900 | ||||||||||||||||||||||||||
| 250,000 | (3) | 20.48 | 12/31/2015 | 70,000 | (20) | 1,838,900 | ||||||||||||||||||||||||||
| 280,000 | (4) | 27.28 | 12/31/2016 | |||||||||||||||||||||||||||||
| 300,000 | (5) | 27.25 | 12/31/2017 | |||||||||||||||||||||||||||||
| 200,000 | (6) | 100,000 | (6) | 24.42 | 12/31/2018 | |||||||||||||||||||||||||||
| 100,000 | (7) | 200,000 | (7) | 24.19 | 12/31/2019 | |||||||||||||||||||||||||||
| 300,000 | (8) | 31.58 | 12/31/2020 | |||||||||||||||||||||||||||||
| J.L. Walsh | ||||||||||||||||||||||||||||||||
| 170,000 | (9) | 22.92 | 03/31/2015 | 0 | 0 | 28,000 | 0 | (18) | ||||||||||||||||||||||||
| 120,000 | (4) | 27.28 | 12/31/2016 | 28,000 | (19) | 735,560 | ||||||||||||||||||||||||||
| 120,000 | (5) | 27.25 | 12/31/2017 | 28,000 | (20) | 735,560 | ||||||||||||||||||||||||||
| 83,333 | (6) | 41,667 | (6) | 24.42 | 12/31/2018 | |||||||||||||||||||||||||||
| 41,666 | (7) | 83,334 | (7) | 24.19 | 12/31/2019 | |||||||||||||||||||||||||||
| 125,000 | (8) | 31.58 | 12/31/2020 | |||||||||||||||||||||||||||||
| P. Kelly | ||||||||||||||||||||||||||||||||
| 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||
| R.C. Flexon | ||||||||||||||||||||||||||||||||
| 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||
| E.V.N. Bissell | ||||||||||||||||||||||||||||||||
| 70,000 | (4) | 27.28 | 12/31/2016 | 0 | 0 | 20,000 | 0 | (21) | ||||||||||||||||||||||||
| 65,000 | (5) | 27.25 | 12/31/2017 | 17,000 | (22) | 747,830 | ||||||||||||||||||||||||||
| 50,000 | (6) | 25,000 | (6) | 24.42 | 12/31/2018 | 14,000 | (23) | 615,860 | ||||||||||||||||||||||||
| 26,666 | (7) | 53,334 | (7) | 24.19 | 12/31/2019 | |||||||||||||||||||||||||||
| 80,000 | (8) | 31.58 | 12/31/2020 | |||||||||||||||||||||||||||||
| R.H. Knauss | ||||||||||||||||||||||||||||||||
| 45,000 | (4) | 27.28 | 12/31/2016 | 12,000 | (16) | 315,240 | (17) | 10,000 | 0 | (18) | ||||||||||||||||||||||
| 45,000 | (5) | 27.25 | 12/31/2017 | 11,000 | (19) | 288,970 | ||||||||||||||||||||||||||
| 16,666 | (6) | 24.42 | 12/31/2018 | 11,000 | (20) | 288,970 | ||||||||||||||||||||||||||
| 38,000 | (7) | 24.19 | 12/31/2019 | |||||||||||||||||||||||||||||
| 57,000 | (8) | 31.58 | 12/31/2020 | |||||||||||||||||||||||||||||
| F. Varagne | ||||||||||||||||||||||||||||||||
| 52,000 | (10) | 20.48 | 06/30/2015 | 0 | 0 | 18,500 | 0 | (24) | ||||||||||||||||||||||||
| 57,000 | (11) | 27.28 | 06/30/2016 | 18,500 | (19) | 485,995 | ||||||||||||||||||||||||||
| 57,000 | (12) | 28.02 | 12/16/2017 | 15,000 | (20) | 394,050 | ||||||||||||||||||||||||||
| 57,000 | (13) | 26.51 | 02/12/2019 | |||||||||||||||||||||||||||||
| 57,000 | (14) | 24.19 | 06/30/2019 | |||||||||||||||||||||||||||||
| 50,000 | (15) | 31.58 | 06/30/2020 | |||||||||||||||||||||||||||||
| Outstanding Equity Awards at Year-End Table – Fiscal 2014 | ||||||||||||||||||||||||||||||||
| Option Awards | Stock Awards | |||||||||||||||||||||||||||||||
| Name | Number of Exercisable (#) | Number of (#) | Option Exercise Price ($) | Option Date | Number (#) | Market ($) | Equity (#) | Equity Incentive ($) | ||||||||||||||||||||||||
| (a) | (b) | (c) | (e) | (f) | (g) | (h) | (i) | (j) | ||||||||||||||||||||||||
J. L. Walsh |
| 187,500 187,500 187,500 125,000 59,500 42,999 | (1) (2) (3) (4) (5) (6) |
| 62,500 119,000 86,001 405,000 | (4) (5) (6) (7) |
| 16.28 16.13 21.06 19.60 21.81 25.50 27.64 |
|
| 12/31/2018 12/31/2019 12/31/2020 12/31/2021 12/31/2022 03/31/2023 12/31/2023 |
| 0 | 0 |
| 39,000 34,500 31,500 63,000 | (11) (12) (13) (14) |
| 2,397,107 1,176,105 1,073,835 2,147,670 |
| ||||||||||||
K. R. Oliver |
| 9,374 37,500 | (8) (5) |
| 18,751 75,000 116,250 | (8) (5) (7) |
| 20.74 21.81 27.64 |
|
| 09/30/2022 12/31/2022 12/31/2023 |
| 0 | 0 |
| 15,000 25,500 19,500 | (15) (12) (14) |
| 921,964 869,295 664,755 |
| ||||||||||||
J. E. Sheridan |
| 15,000 21,000 71,250 85,500 | (4) (9) (5) (7) |
| 19.60 18.70 21.81 27.64 |
|
| 12/31/2021 03/02/2022 12/31/2022 12/31/2023 |
|
| 1,821 3,189 | (16) (18) |
| 83,074 145,482 | (17) (17) |
| 4,500 8,000 14,250 9,500 8,000 | (19) (20) (21) (22) (23) |
| 0 0 650,085 433,390 364,960 |
| |||||||||||
M. M. Gaudiosi |
| 50,000 25,000 | (10) (5) |
| 25,000 50,000 75,000 | (10) (5) (7) |
| 17.75 21.81 27.64 |
|
| 04/22/2022 12/31/2022 12/31/2023 |
| 0 | 0 |
| 15,000 15,000 12,750 | (24) (12) (14) |
| 921,964 511,350 434,648 |
| ||||||||||||
B. C. Hall |
| 55,500 63,000 42,000 21,000 | (2) (3) (4) (5) |
| 21,000 42,000 51,000 | (4) (5) (7) |
| 16.13 21.06 19.60 21.81 27.64 |
|
| 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 |
| 0 | 0 |
| 10,500 9,000 7,950 | (11) (12) (14) |
| 645,392 306,810 271,016 |
| ||||||||||||
Note: Column (d) was intentionally omitted.
| (1) | These options were granted effective January 1, |
| (2) | These options were granted effective January 1, |
| (3) | These options were granted effective January 1, |
-57-
| (4) | These options were granted effective January 1, | |
These options were granted effective January 1, |
| (6) | These options were granted effective April 1, 2013 in connection with Mr. Walsh’s promotion to Chief Executive Officer in 2013. These options vest 33 1/3 percent on each anniversary of the grant date and will be fully vested on April 1, 2016. |
| (7) | These options were granted effective January 1, |
| (8) | These options were granted effective October 1, 2012 in connection with the commencement of Mr. Oliver’s employment. These options vest 33 1/3 percent on each anniversary of the grant date and will be fully vested on October 1, 2015. |
| (9) | These options were granted effective March 3, 2012 in connection with Mr. Sheridan’s promotion to President and Chief Executive Officer in 2012. These options vest 33 1/3 percent on each anniversary of the grant date and will be fully vested on March 3, 2015. |
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| (10) | These options were granted effective April | |
| 23, 2012 in connection with the commencement of Ms. Gaudiosi’s employment. These options | ||
The amount shown relates to a target award of performance units granted effective January 1, |
These performance units were awarded January |
| (13) | These performance units were awarded April 1, 2013 in connection with Mr. Walsh’s promotion to Chief Executive Officer in 2013. The measurement period is the same as described in footnote 12 and the performance goal is the same as described in footnote 11. The performance units will be payable, if at all, on January 1, 2016. |
| (14) | These performance units were awarded January 1, 2014. The measurement period for the performance goal is January 1, 2014 through December 31, 2016. The performance goal is the same as described in footnote 11, but is measured for a different three-year period. The performance units will be payable, if at all, on January 1, 2017. |
| (15) | These performance units were granted effective October 1, 2012 in connection with the commencement of Mr. Oliver’s employment. The measurement period is the same as described in footnote 11 and the performance goal is the same as described in footnote 11. The performance units will be payable, if at all, on January 1, 2015. |
| (16) | These phantom units have a grant date of December 3, 2012 and represent time-restricted AmeriGas Partners common units that will vest on December 3, 2014, subject to continued employment. In the event of termination of employment for any reason, other than retirement, death or disability, the unvested phantom units and dividend equivalents will be forfeited. In the event of retirement, death or disability during the initial year following the grant, one half of the number of units granted would immediately vest and the remainder are forfeited. |
| (17) | The amount shown represents the closing price of AmeriGas Partners common units on September 30, 2014 multiplied by the number of phantom units awarded. |
| (18) | These phantom units have a grant date of January 16, 2014 and represent time-restricted AmeriGas Partners common units that will vest on January 16, 2015, subject to continued employment. In the event of termination of employment for any reason, other than retirement, death or disability, the unvested phantom units and distribution equivalents will be forfeited. |
| (19) | The amount shown relates to a target award of AmeriGas Partners performance units granted effective January 1, 2012. The performance measurement period for these restricted units is January 1, 2012 through December 31, 2014. The value of the number of restricted units that may be earned at the end of the performance period is based on the AmeriGas Partners TUR relative to that of each of the master limited partnerships in the Alerian MLP Index as of the first day of the performance measurement period. The actual number of restricted units and accompanying distribution equivalents earned may be higher (up to 200% of the target award) or lower than the amount shown, based on TUR performance through the end of the performance period. The restricted units will be payable, if at all, on January 1, 2015. As of November 30, 2014, the AmeriGas Partners TUR ranking qualified for no payout. See Compensation Discussion and Analysis – Long-Term Compensation – Fiscal 2014 Equity Awards for more information on the TUR performance goal measurements. |
| (20) | These performance units were awarded March 3, 2012 in connection with Mr. Sheridan’s promotion to Chief Executive Officer in 2012. The measurement period is the same as described in footnote 19 and the performance goal is the same as described in footnote 19. The performance units will be payable, if at all, on January 1, 2015. |
| (21) | These performance units were awarded January 1, 2013. The measurement period for the performance goal is January 1, 2013 through December 31, 2015. The performance goal is the same as described in footnote 19, but it is measured for a different three-year period. The performance units will be payable, if at all, on January 1, |
These performance units were awarded January 1, | ||
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These performance units were granted effective |
| (24) | These performance units were granted effective April 23, 2012 in connection with the commencement of Ms. Gaudiosi’s employment. The measurement period is the same as described in footnote 11 and the performance goal is the same as described in footnote 11. The performance units will be payable, if at all, on January 1, 2015. |
Option Exercises and Stock Vested in Fiscal 20112014
The following table sets forth (i) the number of shares of UGI Corporation common stock acquired by the named executive officers in Fiscal 20112014 from the exercise of stock options, (ii) the value realized by those officers upon the exercise of stock options based on the difference between the market price for our common stock on the date of exercise and the exercise price for the options, (iii) the number of performance units and stock units previously granted to the named executive officers that vested in Fiscal 2011,2014, and (iv) the value realized by those officers upon the vesting of such units based on the closing market price for shares of our common stock, or for Mr. Bissell,Sheridan, common units of AmeriGas Partners, on the vesting date.
| Option Awards | Stock Awards | |||||||||||||||
| Number of | ||||||||||||||||
| Shares | Number of | |||||||||||||||
| Acquired on | Value Realized on | Shares Acquired | Value Realized | |||||||||||||
| Exercise | Exercise | on Vesting | on Vesting | |||||||||||||
| Name | (#) | ($) | (#) | ($) | ||||||||||||
| (a) | (b) | (c) | (d) | (e) | ||||||||||||
| L.R. Greenberg | 120,000 | 1,808,400 | 134,330 | 4,242,141 | ||||||||||||
| J.L. Walsh | 100,000 | 888,530 | 51,813 | 1,636,255 | ||||||||||||
| P. Kelly | 177,332 | 867,441 | 28,785 | 909,030 | ||||||||||||
| R.C. Flexon | 0 | 0 | 0 | 0 | ||||||||||||
| E.V.N. Bissell | 21,667 | 244,187 | 17,736 | 864,985 | ||||||||||||
| R.H. Knauss | 52,333 | 377,688 | 17,271 | 545,418 | ||||||||||||
| F. Varagne | 60,000 | 661,806 | 17,751 | 560,577 | ||||||||||||
| Option Exercises and Stock Vested Table – Fiscal 2014 | ||||||||||||||||
| Option Awards | Stock Awards | |||||||||||||||
| Name | Number of Shares (#) | Value Realized on ($) | Number of (#) | Value Realized ($) | ||||||||||||
| (a) | (b) | (c) | (d) | (e) | ||||||||||||
J. L. Walsh | 180,000 | 2,428,552 | 42,000 | 1,160,880 | ||||||||||||
K. R. Oliver | 0 | 0 | 7,500 | 207,300 | ||||||||||||
J. E. Sheridan | 213,124 | 2,283,276 | 0 | 0 | ||||||||||||
M. M. Gaudiosi | 0 | 0 | 10,000 | 276,414 | ||||||||||||
B. C. Hall | 0 | 0 | 10,500 | 290,220 | ||||||||||||
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The following table shows (i) the number of years of credited service for the named executive officers under the Company’s defined benefit retirement plan (which we refer to below as the “UGI Utilities, Inc. Retirement Plan”), and its supplemental executive retirement plan (which we refer to below as the “UGI SERP”), and the Antargaz Supplemental Executive Retirement Plan, (ii) the actuarial present value of accumulated benefits under those plans as of September 30, 2011,2014, and (iii) any payments made to the named executive officers in Fiscal 20112014 under those plans.
| Number of | Present Value of | |||||||||||||
| Years Credited | Accumulated | Payments During | ||||||||||||
| Service | Benefit | Last Fiscal Year | ||||||||||||
| Name | Plan Name | (#) | ($) | ($) | ||||||||||
| (a) | (b) | (c) | (d) | (e) | ||||||||||
| L.R. Greenberg | UGI SERP | 31 | 17,468,893 | 0 | ||||||||||
| UGI Utilities, Inc. Retirement Plan | 31 | 1,554,305 | 0 | |||||||||||
| J.L. Walsh | UGI SERP | 6 | 1,334,165 | 0 | ||||||||||
| UGI Utilities, Inc. Retirement Plan | 6 | 242,094 | 0 | |||||||||||
| P. Kelly | UGI SERP | 0 | 0 | 0 | ||||||||||
| UGI Utilities, Inc. Retirement Plan | 0 | 0 | 0 | |||||||||||
| R.C. Flexon | None | 0 | 0 | 0 | ||||||||||
E.V.N. Bissell(1) | UGI Utilities, Inc. Retirement Plan | 6 | 33,286 | 0 | ||||||||||
| R.H. Knauss | UGI SERP | 24 | 1,504,682 | 0 | ||||||||||
| UGI Utilities, Inc. Retirement Plan | 24 | 809,550 | 0 | |||||||||||
| F. Varagne | Antargaz Supplemental Executive Retirement Plan | 2 | 270,185 | 0 | ||||||||||
| Pension Benefits Table – Fiscal 2014 | ||||||||||||||
| Name | Plan Name | Number of (#) | Present Value of ($) | Payments During Last Fiscal Year ($) | ||||||||||
| (a) | (b) | (c) | (d) | (e) | ||||||||||
J. L. Walsh | UGI SERP | 9 | 3,187,832 | 0 | ||||||||||
| UGI Utilities, Inc. Retirement Income Plan | 9 | 471,620 | 0 | |||||||||||
K. R. Oliver | None | 0 | 0 | 0 | ||||||||||
J. E. Sheridan | None | 0 | 0 | 0 | ||||||||||
M. M. Gaudiosi | None | 0 | 0 | 0 | ||||||||||
B. C. Hall | UGI SERP | 32 | 1,679,230 | 0 | ||||||||||
| UGI Utilities, Inc. Retirement Income Plan | 32 | 2,134,990 | 0 | |||||||||||
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The Company participates in the UGI Utilities, Inc. Retirement Income Plan, a qualified defined benefit retirement plan (“Pension Plan”), to provide retirement income to its employees hired prior to January 1, 2009. The Pension Plan pays benefits based upon final average earnings, consisting of base salary or wages and annual bonuses and years of credited service. Benefits vest after the participant completes five years of vesting service.
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The Pension Plan’s normal retirement benefit formula is (A) -– (B) and is shown below:
A = The minimum of (1) and (2), where
(1) = 1.9% of five-year final average earnings (as defined in the Pension Plan) multiplied by years of service;
(2) = 60% of the highest year of year of earnings; and
B = 1% of the estimated primary Social Security benefit multiplied by years of service.
The amount of the benefit produced by the formula will be reduced by an early retirement factor based on the employee’s actual age in years and months as of his early retirement date. The reduction factors range from 65 percent at age 55 to 100 percent (no reduction) at age 62.
The normal form of benefit under the Pension Plan for a married employee is a 50 percent joint and survivor lifetime annuity. Regardless of marital status, a participant may choose from a number of lifetime annuity payments.
The Pension Plan is subject to qualified-plan Code limits on the amount of annual benefit that may be paid, and on the amount of compensation that may be taken into account in calculating retirement benefits under the plan. For 2011,plan year 2014, the limit on the compensation that may be used is $245,000$260,000 and the limit on annual benefits payable for an employee retiring at age 65 in 20102014 is $195,000.$210,000. Benefits in excess of those permitted under the statutory limits are paid from the Company’s Supplemental Executive Retirement Plan, described below.
Messrs. Greenberg, Walsh Bissell and KnaussHall are currently eligible for early retirement benefits under the Pension Plan.
UGI Corporation Supplemental Executive Retirement Plan
The Company’s Supplemental Executive Retirement Plan (“SERP”) is a non-qualified defined benefit plan that provides retirement benefits that would otherwise be provided under the Pension Plan to employees hired prior to January 1, 2009, but are prohibited from being paid from the Pension Plan by Code limits. The benefit paid by the SERP is approximately equal to the difference between the benefits provided under the Pension Plan to eligible participants and benefits that would have been provided by the Pension Plan if not for the limitations of the Employee Retirement Income Security Act of 1974, as amended, and the Code. Benefits vest after the participant completes 5 years of vesting service. The benefits earned under the SERP are payable in the form of a lump sum payment.payment or transferred into the Company’s nonqualified deferred compensation plan. For participants who attained age 50 prior to January 1, 2004, the lump sum payment is calculated using two
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payment is made within 15 days after expiration of a six-month postponement period following “separation from service” as defined in the Code.
Actuarial assumptions used to determine values in the Pension Benefits Table — Fiscal 2011
The amounts shown in the Pension Benefit Table above are actuarial present values of the benefits accumulated through September 30, 2011.2014. An actuarial present value is calculated by estimating expected future payments starting at an assumed retirement age, weighting the estimated payments by the estimated probability of surviving to each post-retirement age, and discounting the weighted payments at an assumed discount rate to reflect the time value of money. The actuarial present value represents an estimate of the amount which,that, if invested today at the discount rate, would be sufficient on an average basis to provide estimated future payments based on the current accumulated benefit. The assumed retirement age for each named executive is age 62, which is the earliest age at which the executive could retire without any benefit reduction due to age. Actual benefit present values will vary from these estimates depending on many factors, including an executive’s actual retirement age. The key assumptions included in the calculations are as follows:
| September 30, 2014 | September 30, 2013 | |||
Discount rate for Pension Plan for all purposes and for SERP, for pre-commencement calculations | 4.60% | 5.20% | ||
SERP lump sum rate | 2.70% for applicable pre-2004 service; 2.50% for other service | 3.10% for applicable pre-2004 service; 2.60% for other service | ||
Retirement age | 62 | 62 | ||
Postretirement mortality for Pension Plan | RP-2000, combined, healthy table projected to 2021 using Scale AA without collar adjustments | RP-2000, combined, healthy table projected to 2020 using Scale AA without collar adjustments | ||
Postretirement Mortality for SERP | 1994 GAR Unisex | 1994 GAR Unisex | ||
Preretirement Mortality | none | none | ||
Termination and disability rates | none | none | ||
Form of payment – qualified plan | Single life annuity | Single life annuity | ||
Form of payment – nonqualified plan | Lump sum | Lump sum |
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The following table shows the contributions, earnings, withdrawals and account balances for each of the named executive officers who participate in the Company’s Supplemental Savings Plan, the 2009 UGI Corporation Supplemental Executive Retirement Plan for New Employees, the AmeriGas Propane, Inc. Supplemental Executive Retirement Plan (“AmeriGas SERP”), and the AmeriGas Propane, Inc. Nonqualified Deferred Compensation Plan and the Antargaz Defined Contribution Plan.
| Aggregate | Aggregate | |||||||||||||||||||||
| Executive | Employer | Earnings | Aggregate | Balance at | ||||||||||||||||||
| Contributions | Contributions | in Last | Withdrawals/ | Last Fiscal | ||||||||||||||||||
| in Last | in Last | Fiscal | Distributions | Year-End | ||||||||||||||||||
| Name | Plan Name | Fiscal Year ($) | Fiscal Year ($) | Year ($) | ($) | ($)(4) | ||||||||||||||||
| (a) | (b) | (c) | (d) | (e) | (f) | |||||||||||||||||
| L.R. Greenberg | UGI Supplemental Savings Plan | 0 | 44,434 | (1) | 0 | 0 | 787,615 | |||||||||||||||
| J.L. Walsh | UGI Supplemental Savings Plan | 0 | 22,510 | (1) | 0 | 0 | 136,904 | |||||||||||||||
| P. Kelly | UGI Supplemental Savings Plan | 0 | 0 | (1) | 0 | 0 | 0 | |||||||||||||||
| R.C. Flexon | 2009 UGI SERP for New Employees | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
| E.V.N. Bissell | AmeriGas SERP | 0 | 68,844 | (2) | 6,928 | 0 | 843,043 | |||||||||||||||
| AmeriGas Nonqualified Deferred Compensation Plan | 0 | 0 | 1,337 | 0 | 34,444 | |||||||||||||||||
| R.H. Knauss | UGI Supplemental Savings Plan | 0 | 8,598 | 0 | 0 | 50,031 | ||||||||||||||||
| AmeriGas SERP | 0 | 0 | 2,237 | 0 | 162,270 | |||||||||||||||||
| F. Varagne | Antargaz Defined Contribution Plan | 0 | 14,032 | (3) | 0 | 0 | 28,530 | |||||||||||||||
| Nonqualified Deferred Compensation Table – Fiscal 2014 | ||||||||||||||||||||||
| Name | Plan Name | Executive Contributions in Last Fiscal Year ($) | Employer Contributions in Last Fiscal Year ($) | Aggregate Earnings in Last Fiscal Year ($) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at Last Fiscal Year-End ($)(3) | ||||||||||||||||
| (a) | (b) | (c) | (d) | (e) | (f) | |||||||||||||||||
J. L. Walsh | UGI Supplemental Savings Plan | 0 | 35,305 | 37,938 | 0 | 276,881 | ||||||||||||||||
K. R. Oliver | 2009 UGI SERP for New Employees | 0 | 102,233 | 5,610 | 0 | 80,661 | ||||||||||||||||
J. E. Sheridan | AmeriGas SERP | 0 | 68,135 | 39,272 | 0 | 424,974 | ||||||||||||||||
M. M. Gaudiosi | 2009 UGI SERP for New Employees | 0 | 77,461 | 5,904 | 0 | 76,503 | ||||||||||||||||
B. C. Hall | UGI Supplemental Savings Plan | 0 | 6,472 | 11,904 | 0 | 82,271 | ||||||||||||||||
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| (1) | This amount represents the employer contribution to the Company’s Supplemental Savings Plan, which is also reported in the Summary Compensation Table | |
| (2) | This amount represents the employer contribution to the AmeriGas SERP, which is also reported in the Summary Compensation Table | |
| (3) | The aggregate balances do not include the | |
| Company contributions occur after fiscal year-end. The aggregate balances include the following aggregate amounts previously reported in the Summary Compensation Table in prior years: Mr. |
The UGI Corporation Supplemental Savings Plan (“SSP”) is a nonqualified deferred compensation plan that provides benefits to certain employees that would be provided under the Company’s 401(k) Savings Plan in the absence of Code limitations. Benefits vest after the participant completes five years of service. The SSP is intended to pay an amount substantially equal to the difference between the Company matching contribution that would have been made under the 401(k) Savings Plan if the Code limitations were not in effect and the Company match actually made under the 401(k) Savings Plan. The Code compensation limit for 2009, 2010plan year 2012 was $245,000, for plan year 2013, $250,000, and 2011 was $245,000.for plan year 2014, $255,000. The Code contribution limit for 2009, 2010each of plan years 2012 and 20112013 was $49,000.$50,000 and for plan year 2014 was $51,000. Under the SSP, the participant is credited with a Company match on compensation in excess of Code limits using the same formula applicable to contributions to the Company’s 401(k) Savings Plan, which is a match of 50 percent on the first 3 percent of eligible compensation, and a match of 25 percent on the next 3 percent, assuming that the employee contributed to the 401(k) Savings Plan the lesser of 6 percent of eligible compensation orand the maximum amount permissible under the Code. Amounts credited to the participant’s account are credited with interest. The rate of interest currently in effect is the rate produced by blending the annual return on the Standard and Poor’s 500 Index (60 percent weighting) and the annual return on the Barclays Capital U.S. Aggregate Bond Index (40 percent weighting). Account balances are payable in a lump sum within 60 days after termination of employment, except as required by Section 409A of the Code. If payment is required to be delayed by Section 409A of the Code, payment is made within 15 days after expiration of a six-month postponement period following “separation from service” as defined in the Code.
The AmeriGas SERP is a nonqualified deferred compensation plan that is intended to provide retirement benefits to certain AmeriGas Propane employees. Under the plan, AmeriGas Propane credits to each participant’s account annually an amount equal to 5 percent of the participant’s compensation (salary and annual bonus) up to the Code compensation limit ($245,000255,000 in 2011)plan year 2014) and 10 percent of compensation in excess of such limit. In addition, if any portion of AmeriGas Propane’s matching contribution under the AmeriGas Propane, Inc. 401(k) Savings Plan (“AmeriGas 401(k) Savings Plan”) is forfeited due to nondiscrimination requirements under the Code, the forfeited amount, adjusted for earnings and losses on the amount, will be credited to a participant’s account. Benefits vest on the fifth anniversary of a participant’s employment commencement date. Participants direct the investment of their account balances among a number of funds, which are generally the same funds available to participants in the AmeriGas 401(k) Savings Plan, other than the Company’sUGI Corporation stock fund. Account balances are payable in a lump sum within 60 days after termination of employment, except as required by Section 409A of the Code. If payment is required to be delayed by Section 409A of the Code, payment is made within 15 days after expiration of a six-month postponement period following “separation from service” as defined in the Code. Amounts payable under the AmeriGas SERP may be deferred in accordance with the Company’s 2009 Deferral Plan. SeeCompensation Discussion and Analysis — – UGI Corporation 2009 Deferral Plan.
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The 2009 UGI Corporation Supplemental Executive Retirement Plan for New Employees (the “2009 UGI SERP”) is a nonqualified deferred compensation plan that is intended to provide retirement benefits to executive officers who are not eligible to participate in the Pension Plan, having been hired on or after January 1, 2009. Under the 2009 UGI SERP, the Company credits to each participant’s account annually an amount equal to 5 percent of the participant’s compensation (salary and annual bonus) up to the Code compensation limit ($245,000255,000 in 2011)plan year 2014) and 10 percent of compensation in excess of such limit. In addition, if any portion of the Company’s matching contribution under the UGI Utilities, Inc. 401(k) Savings Plan is forfeited due to nondiscrimination requirements under the Code, the forfeited amount, adjusted for earnings and losses on the amount, will be credited to a participant’s account. Benefits vest on the fifth anniversary of a participant’s employment commencement date. Participants direct the investment of their account balances among a number of mutual funds, which are generally the same funds available to participants in the UGI Utilities, Inc. 401(k) Savings Plan, other than the UGI Corporation stock fund. Account balances are payable in a lump sum within 60 days after termination of employment, except as required by Section 409A of the Code. If payment is required to be delayed by Section 409A of the Code, payment is made within 15 days after expiration of a six-month postponement period following “separation from service” as defined in the Code. Amounts payable under the 2009 UGI SERP may be deferred in accordance with the UGI Corporation 2009 Deferral Plan. SeeCompensation Discussion and Analysis —– UGI Corporation 2009 Deferral Plan.
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Severance Pay Plan for Senior Executive Employees
Named Executive Officers Employed by UGI Corporation.The UGI Corporation Senior Executive Employee Severance Plan (the “UGI Severance Plan”) provides for payment to certain senior level employees of UGI, including Messrs. Greenberg, Walsh, Oliver and Knauss,Hall and Ms. Gaudiosi, in the event their employment is terminated without fault on their part. Benefits are payable to a senior executive covered by the UGI Severance Plan if the senior executive’s employment is involuntarily terminated for any reason other than for just cause or as a result of the senior executive’s death or disability. Under the UGI Severance Plan, “just cause” generally means (i) dismissal of an executive due to (i) misappropriation of funds, (ii) substance abuse or habitual insobriety that adversely affects the executive’s ability to perform his or her job, (iii) conviction of a crime involving moral turpitude, or (iv) gross negligence in the performance of duties.
Except as provided herein, the UGI Severance Plan provides for cash payments equal to a participant’s compensation for a period of time ranging from six months to 18 months, depending on length of service (the “Continuation Period”). In the case of Mr. Greenberg,Walsh, the Continuation Period is 30 months; for Mr. Walsh, the Continuation Period ranges from 12 months to 24 months, depending on length of service.months. In addition, a participant receivesmay receive an annual bonus for his or her year of termination, subject to the cash equivalentCommittee’s discretion and not to exceed the amount of his targetor her bonus under the Annual Bonus Plan, pro-rated for the number of months served in the fiscal year prior to termination. However, if the termination occurs in the last two months of the fiscal year, we have the discretion to determine whether the participant will receive a pro-rated target bonus, or the actual annual bonus which would have been paid after the end of the fiscal year, assuming that the participant’s entire bonus was contingent on meeting the applicable financial performance goal, pro-rated for the number of months served. The levels of severance payments were established by the Committee based on competitive practice and are reviewed by management and the Committee from time to time.
Under the UGI Severance Plan, a participant also receives a payment equal to the cost the participant would have incurred to continue medical and dental coverage under the Company’s plans for the Continuation Period (less the amount the participant would be required to contribute for such coverage if the participant were an active employee)., provided continued medical and dental coverage would not result in adverse tax consequences to the participant or the Company and is permitted under the applicable medical and dental plans. The maximum period for calculating the payment of such benefits is 18 months (30 months in the case of Mr. Greenberg and 24 months in the case of Mr. Walsh). The UGI Severance Plan also provides for outplacement services for a period of 12 months following a participant’s termination of employment and reimbursement for tax preparation services, if eligible, for the final year of employment. Provided that the participant is eligible to retire, all payments under the UGI Severance Plan may be reduced by an amount equal to the fair market value of certain equity-based awards, other than stock options, payable to the participant after the termination of employment.
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provided by or entered into with UGI or its subsidiaries. The UGI Severance Plan also requires a senior executive to ratify any existing post-employment activities agreement (which restricts the senior executive from competing with UGI and its affiliatesthe Company following termination of employment) and to cooperate in attending to matters pending at the time of termination of employment.
Named Executive Officers Employed by AmeriGas Propane.The AmeriGas Propane, Inc. Senior Executive Employee Severance Plan (the “AmeriGas Severance Plan”) provides for payment to certain senior level employees of AmeriGas Propane, including Mr. Bissell,Sheridan, in the event their employment is terminated without fault on their part. Specified benefits are payable to a senior executive covered by the AmeriGas Severance Plan if the senior executive’s employment is involuntarily terminated for any reason other than for just cause or as a result of the senior executive’s death or disability. Under the AmeriGas Severance Plan, “just cause” generally means (i) dismissal of an executive due to (i) misappropriation of funds, (ii) substance abuse or habitual insobriety that adversely affects the executive’s ability to perform his job, (iii) conviction of a crime involving moral turpitude, or (iv) gross negligence in the performance of duties.
Except as provided herein, the AmeriGas Severance Plan provides for cash payments equal to a participant’s compensation for a period of time ranging from six months to 18 months, depending on length of service (the “Continuation“AmeriGas Continuation Period”). In the case of Mr. Bissell,Sheridan, the AmeriGas Continuation Period ranges from 12 months to 24 months, depending on length of service. In addition, a participant receivesmay receive an annual bonus for his or her year of termination, subject to the cash equivalentCommittee’s discretion and not to exceed the amount of his targetor her bonus under the Annual Bonus Plan, pro-rated for the number of months served in the fiscal year. However, if the termination occurs in the last two months of the fiscal year AmeriGas Propane has the discretionprior to determine whether the participant will receive a pro-rated target bonus, or the actual annual bonus which would have been paid after the end of the fiscal year, provided that the weighting to be applied to the participant’s business/financial goals under the AmeriGas Propane Annual Bonus Plan will be deemed to be 100 percent, pro-rated for the number of months served.termination. The levels of severance payments were established by the Committee based on competitive practice and are reviewed by management and the Committee from time to time.
Under the AmeriGas Severance Plan, a participant also receives a payment equal to the cost the participant would have incurred to continue medical and dental coverage under AmeriGas Propane’s plans for the AmeriGas Continuation Period (less the amount the participant would be required to contribute for such coverage if the participant were an active employee)., provided continued medical and dental coverage would not result in adverse tax consequences to the participant or AmeriGas Propane and is permitted under the applicable medical and dental plans. The AmeriGas Severance Plan also provides for outplacement services for a period of 12 months following a participant’s termination of employment, and reimbursement for tax preparation services, if eligible, for the final year of employment. Provided that the participant is eligible to retire, all payments under the AmeriGas Severance Plan may be reduced by an amount equal to the fair market value of certain equity-based awards, other than stock options, payable to the participant after the termination of employment.
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Severance Arrangement for Mr. Varagne
Named Executive Officers Employed by UGI Corporation.Messrs. Greenberg, Walsh, Oliver and KnaussHall and Ms. Gaudiosi each have an agreement with the Company whichthat provides benefits in the event of a change in control. TheMessrs. Walsh’s and Hall’s agreements have a term of one year with automatic one-year extensions in May of each year, unless in each case, prior to a change in control, the Company terminates ansuch agreement with required advance notice. Each of Mr. Oliver’s and Ms. Gaudiosi’s agreement has a term of three years with automatic one-year extensions each year, unless, prior to a change in control, the Company terminates such agreement with required advance notice. In the absence of a change in control or termination by the Company, each agreement will terminate when, for any reason, the executive terminates his or her employment with the Company. A change in control is generally deemed to occur in the following instances:
Any person (other than certain persons or entities affiliated with the Company), together with all affiliates and associates of such person, acquires securities representing 20 percent or more of either (i) the then outstanding shares of common stock, or (ii) the combined voting power of the Company’s then outstanding voting securities;
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outstanding shares of common stock, or (ii) the combined voting power of the Company’s then outstanding voting securities; |
Individuals, who at the beginning of any 24-month period constitute the Board of Directors (the “Incumbent Board”) and any new Director whose election by the Board of Directors, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the Incumbent Board, cease for any reason to constitute a majority;
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The Company is liquidated or dissolved.
The Company will provide each of Messrs. Greenberg, Walsh, Oliver and KnaussHall and Ms. Gaudiosi with cash benefits (“Benefits”) if we terminate his or her employment without “cause” or if he or she terminates employment for “good reason” at any time within two years following a change in control of the Company. “Cause” generally includes (i) misappropriation of funds, (ii) habitual insobriety or substance abuse, (iii) conviction of a crime involving moral turpitude, or (iv) gross negligence in the performance of duties, which gross negligence has had a material adverse effect on the business, operations, assets, properties or financial condition of the Company. “Good reason” generally includes a material diminution in authority, duties, responsibilities or base compensation; a material breach by the Company of the terms of the agreement; and substantial relocation requirements. If the events trigger a payment following a change in control, the Benefitsbenefits payable to each of Messrs. Greenberg, Walsh, Oliver, Hall and KnaussMs. Gaudiosi will be as specified under his or her change in control agreement unless payments under the UGI Severance Plan described above would be greater, in which case Benefitsbenefits would be provided under the UGI Severance Plan.
Benefits under this arrangement would be equal to three times the executive officer’s base salary and annual bonus. Each executive would also receive the cash equivalent of his or her target bonus, prorated for the number of months served in the fiscal year. In addition, Messrs. Greenberg, Walsh, Oliver and KnaussHall and Ms. Gaudiosi are each entitled to receive a payment equal to the cost he or she would incur if he or she enrolled in the Company’s medical and dental plans for three years (less the amount he or she would be required to contribute for such coverage if he or she were an active employee). Messrs. Greenberg, Walsh, Oliver and KnaussHall and Ms. Gaudiosi would also have benefits under the Company’s Supplemental Executive Retirement Plan and Mr. Oliver and Ms. Gaudiosi would also have benefits under the Company’s 2009 UGI SERP, calculated as if each of them had continued in employment for three years. In addition, outstanding performance units, stock units and dividend equivalents will be paid in cash based on the fair market value of the Company’s common stock in an amount equal to the greater of (i) the target award, orand (ii) the award amount that would have been paid if the performance unit measurement period ended on the date of the change in control, as determined by the Compensation and Management Development Committee. For treatment of stock options, see the Grants of Plan — Plan—Based Awards Table — Table—Fiscal 2011.
The Benefitsbenefits for Messrs. Walsh and Hall are subject to a “conditional gross-up” for excise and related taxes in the event they would constitute “excess parachute payments,” as defined in Section 280G of the Code. The Company will provide the tax gross-up if the aggregate parachute value of Benefitsbenefits is greater than 110 percent of the maximum amount that may be paid under Section 280G of the Code without imposition of an excise tax. If the parachute value does not exceed the 110 percent threshold, the Benefitsbenefits for each of Messrs. Greenberg, Walsh and KnaussHall will be reduced to the extent necessary to avoid imposition of the excise tax on “excess parachute payments.”
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Named Executive Officers Employed by AmeriGas Propane, Inc.Mr. BissellSheridan has an agreement with AmeriGas Propane that provides benefits in the event of a change in control. His agreement has a term of one year and is automatically extended for one-year terms in May of each year unless, prior to a change in control, AmeriGas Propane terminates his agreement with required advance notice. In the absence of a change in control or termination by AmeriGas Propane, his agreement will terminate when, for any reason, he terminates his employment with AmeriGas Propane. A change in control is generally deemed to occur in the following instances:
Any person (other than certain persons or entities affiliated with the Company), together with all affiliates and associates of such person, acquires securities representing 20 percent or more of either (i) the then outstanding shares of common stock, or (ii) the combined voting power of the Company’s then outstanding voting securities;
Individuals, who at the beginning of any 24-month period constitute the Company’s Board of Directors (the “Incumbent Board”) and any new Director whose election by the Board of Directors, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the Incumbent Board, cease for any reason to constitute a majority;
The Company is reorganized, merged or consolidated with or into, or sells all or substantially all of its assets to, another corporation in a transaction in which former shareholders of the Company do not own more than 50 percent of, respectively, the outstanding common stock and the combined voting power of the then outstanding voting securities of the surviving or acquiring corporation;
AmeriGas Propane, AmeriGas Partners or AmeriGas Propane, L.P. is reorganized, merged or consolidated with or into, or sells all or substantially all of its assets to, another entity in a transaction with respect to which all of the individuals and entities who were owners of the General Partner’sAmeriGas Propane’s voting securities or of the outstanding units of the Partnership immediately prior to such transaction do not, following such transaction, own more than 50 percent of, respectively, the outstanding common stock and the combined voting power of the then outstanding voting securities of the surviving or acquiring corporation, or if the resulting entity is a partnership, the former unitholders do not own more than 50 percent of the outstanding common units in substantially the same proportion as their ownership immediately prior to the transaction;
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The Company fails to own more than 50 percent of the general partnership interests of AmeriGas Partners or the Operating Partnership;
The Company fails to own more than 50 percent of the outstanding shares of common stock of AmeriGas Propane; or
AmeriGas Propane is removed as the general partnerGeneral Partner of AmeriGas Partners or the Operating Partnership.
AmeriGas Propane will provide Mr. BissellSheridan with cash benefits (“Benefits”) if there is a termination of his employment without “cause” or if he terminates employment for “good reason” at any time within two years following a change in control. “Cause” generally includes (i) misappropriation of funds, (ii) habitual insobriety or substance abuse, (iii) conviction of a crime involving moral turpitude, or (iv) gross negligence in the performance of duties, which gross negligence has had a material adverse effect on the business, operations, assets, properties or financial condition of AmeriGas Propane. “Good reason” generally includes a material diminution in authority, duties, responsibilities or base compensation; a material breach by AmeriGas
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Propane of the terms of the agreement; and substantial relocation requirements. If the events trigger a payment following a change in control, the benefits payable to Mr. BissellSheridan will be as specified under his change in control agreement unless payments under the AmeriGas Severance Plan described above would be greater, in which case Benefitsbenefits would be provided under the AmeriGas Severance Plan.
Benefits under this arrangement would be equal to three times Mr. Bissell’sSheridan’s base salary and annual bonus. Mr. BissellSheridan would also receive the cash equivalent of his target bonus, prorated for the number of months served in the fiscal year. In addition, he is entitled to receive a payment equal to the cost he would incur if he enrolled in AmeriGas Propane’s medical and dental plans for three years (less the amount he would be required to contribute for such coverage if he were an active employee). Mr. BissellSheridan would also receive his benefits under the AmeriGas SERP calculated as if he had continued in employment for three years. In addition, outstanding performance units and distribution equivalents will be paid in cash based on the fair market value of AmeriGas Partners common units in an amount equal to the greater of (i) the target award, orand (ii) the award amount that would have been paid if the measurement period ended on the date of the change in control, as determined by the AmeriGas Propane Compensation/Pension Committee. For treatment of stock options, see the Grants of Plan-Based Awards Table —– Fiscal 2011.
2014.
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In order to receive benefits under his change in control agreement, Mr. BissellSheridan is required to execute a release whichthat discharges AmeriGas Propane and its affiliates from liability for any claims he may have against any of them, other than claims for amounts or benefits due under any plan, program or contract provided by or entered into with AmeriGas Propane or its affiliates.
Potential Payments Upon Termination or Change in Control
The amounts shown in the table below are merely estimates of the incremental amounts that would be paid out to the named executive officers if their termination had occurred on the last day of Fiscal 2011.2014. The actual amounts to be paid out can only be determined at the time of such named executive officer’s termination of employment. The amounts set forth in the table below do not include compensation to which each named executive officer would be entitled without regard to his termination of employment, including (i) base salary and short-term incentives that have been earned but not yet paid, and (ii) amounts that have been earned, but not yet paid, under the terms of the plans reflected in the Pension Benefits Table —– Fiscal 2011
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2014 and the Nonqualified Deferred Compensation Table —– Fiscal 2011.2014. There are no incremental payments in the event of voluntary resignation, termination for cause, disability or upon retirement.
| Potential Payments Upon Termination or Change in Control Table – Fiscal 2014 | ||||||||||||||||||||
| Name & Triggering Event | Severance Pay($)(1)(2) | Equity Awards with Accelerated Vesting($)(3) | Nonqualified Retirement Benefits($)(4) | Welfare & Other Benefits($)(5) | Total($) | |||||||||||||||
J. L. Walsh | ||||||||||||||||||||
Death | 0 | 9,263,295 | 2,324,481 | 0 | 11,587,776 | |||||||||||||||
Involuntary Termination Without Cause | 5,619,264 | 0 | 2,677,973 | 61,523 | 8,358,760 | |||||||||||||||
Termination Following Change in Control | 8,020,740 | 16,910,262 | 5,452,596 | 10,742,431 | 41,126,029 | |||||||||||||||
K. R. Oliver | ||||||||||||||||||||
Death | 0 | 3,233,590 | 0 | 0 | 3,233,590 | |||||||||||||||
Involuntary Termination Without Cause | 933,878 | 0 | 0 | 37,205 | 971,083 | |||||||||||||||
Termination Following Change in Control | 3,136,381 | 5,911,189 | 235,433 | 87,235 | 9,370,238 | |||||||||||||||
J. E. Sheridan | ||||||||||||||||||||
Death | 0 | 3,465,278 | 0 | 0 | 3,465,278 | |||||||||||||||
Involuntary Termination Without Cause | 1,703,460 | 0 | 0 | 58,676 | 1,762,136 | |||||||||||||||
Termination Following Change in Control | 3,141,850 | 4,214,206 | 234,645 | 75,549 | 7,666,250 | |||||||||||||||
M. M. Gaudiosi | ||||||||||||||||||||
Death | 0 | 2,503,383 | 0 | 0 | 2,503,383 | |||||||||||||||
Involuntary Termination Without Cause | 699,945 | 0 | 0 | 26,464 | 726,409 | |||||||||||||||
Termination Following Change in Control | 2,353,625 | 4,320,209 | 169,044 | 31,447 | 6,874,325 | |||||||||||||||
B. C. Hall | ||||||||||||||||||||
Death | 0 | 1,801,833 | 1,916,323 | 0 | 3,718,156 | |||||||||||||||
Involuntary Termination Without Cause | 1,142,800 | 0 | 2,223,113 | 52,760 | 3,418,673 | |||||||||||||||
Termination Following Change in Control | 2,052,040 | 2,950,043 | 3,099,877 | 1,973,824 | 10,075,784 | |||||||||||||||
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| Equity | ||||||||||||||||||||
| Awards with | Nonqualified | Welfare & | ||||||||||||||||||
| Severance | Accelerated | Retirement | Other | |||||||||||||||||
| Name & Triggering Event | Pay($) | Vesting($)(3) | Benefits($)(4) | Benefits($)(5) | Total($) | |||||||||||||||
L. R. Greenberg | ||||||||||||||||||||
| Death | 0 | 4,278,800 | 0 | 0 | 4,278,800 | |||||||||||||||
| Involuntary Termination Without Cause | 6,980,847 | (1) | 0 | 0 | 63,757 | 7,044,604 | ||||||||||||||
| Termination Following Change in Control | 8,208,428 | (2) | 6,117,700 | 4,918,610 | 48,908 | 19,293,646 | ||||||||||||||
J. L. Walsh | ||||||||||||||||||||
| Death | 0 | 1,721,537 | 0 | 0 | 1,721,537 | |||||||||||||||
| Involuntary Termination Without Cause | 2,194,782 | (1) | 0 | 0 | 44,194 | 2,238,976 | ||||||||||||||
| Termination Following Change in Control | 4,501,987 | (2) | 2,457,097 | 1,906,395 | 3,214,775 | 12,080,254 | ||||||||||||||
P. Kelly(6) | ||||||||||||||||||||
| Death | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
| Involuntary Termination Without Cause | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
| Termination Following Change in Control | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
R.C. Flexon(6) | ||||||||||||||||||||
| Death | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
| Involuntary Termination Without Cause | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
| Termination Following Change in Control | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
E. V.N. Bissell | ||||||||||||||||||||
| Death | 0 | 1,740,823 | 0 | 0 | 1,740,823 | |||||||||||||||
| Involuntary Termination Without Cause | 2,063,816 | (1) | 0 | 0 | 72,355 | 2,136,171 | ||||||||||||||
| Termination Following Change in Control | 2,874,683 | (2) | 2,400,673 | 247,609 | 85,836 | 5,608,801 | ||||||||||||||
R.H. Knauss | ||||||||||||||||||||
| Death | 0 | 976,783 | 0 | 0 | 976,783 | |||||||||||||||
| Involuntary Termination Without Cause | 1,126,953 | (1) | 0 | 0 | 47,454 | 1,174,407 | ||||||||||||||
| Termination Following Change in Control | 2,105,799 | (2) | 1,265,753 | 1,407,708 | 1,702,023 | 6,481,283 | ||||||||||||||
F. Varagne(7) | ||||||||||||||||||||
| Involuntary Termination Without Cause | 1,380,000 | 0 | 0 | 13,800 | 1,393,800 | |||||||||||||||
| (1) | Amounts shown under “Severance Pay” in the case of involuntary termination without cause are calculated under the terms of the UGI Severance Plan for Messrs. | |
| (2) | Amounts shown under “Severance Pay” in the case of termination following a change in control are calculated under the officer’s change in control agreement. | |
| (3) | In calculating the amounts shown under “Equity Awards with Accelerated Vesting” we assumed (i) the continuation of the Company’s dividend (and AmeriGas | |
| (4) | Amounts shown under “Nonqualified Retirement Benefits” are in addition to amounts shown in the Pension Benefits Table | |
| (5) | Amounts shown under “Welfare and Other Benefits” include estimated payments for (i) medical and dental insurance premiums, (ii) outplacement services, (iii) tax preparation services, | |
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The closing price of our Stock, as reported on the New York Stock Exchange Composite Tape on November 14, 2011,12, 2014, was $29.23.
| SECURITIES OWNERSHIPOF DIRECTORSAND EXECUTIVE OFFICERS |
The following table shows the number of shares beneficially owned by each Director, by each of the executive officers named in the Summary Compensation Table – Fiscal 2014, and by all Directors and executive officers as a group. The table shows their beneficial ownership as of October 1, 2014.
Our subsidiary, AmeriGas Propane, Inc., is the General Partner of AmeriGas Partners, one of our consolidated subsidiaries and a publicly-traded limited partnership. The table also shows, as of October 1, 2014, the number of common units of AmeriGas Partners, and phantom units representing common units, beneficially owned by each Director and named executive officer, and by all Directors and executive officers as a group.
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Each person named in the table beneficially owns less than 1 percent of the outstanding common stock and less than 1 percent of the outstanding common units of AmeriGas Partners. Directors and executive officers as a group own approximately 2.36 percent of the outstanding common stock and less than 1 percent of the outstanding common units of AmeriGas Partners. For purposes of reporting total beneficial ownership, shares that may be acquired within 60 days of October 1, 2014 through UGI Corporation stock option exercises are included.
Beneficial Ownership of Directors, Nominees and Named Executive Officers
Name | Number of Shares of UGI Common Stock(1) | Number of UGI Stock Units(2) | Exercisable Options For UGI Common Stock | Number of AmeriGas Partners, L.P. Common Units | Number of AmeriGas Partners, L.P. Phantom Units(3) | |||||||||||||||
Monica M. Gaudiosi | 15,928 | 0 | 74,998 | 0 | 0 | |||||||||||||||
Richard W. Gochnauer | 0 | 16,768 | 51,000 | 0 | 0 | |||||||||||||||
Lon R. Greenberg | 501,835 | (4) | 0 | 900,000 | 15,000 | 0 | ||||||||||||||
Bradley C. Hall | 100,246 | (5) | 0 | 181,500 | 0 | 0 | ||||||||||||||
Frank S. Hermance | 150,000 | (6) | 14,616 | 44,625 | 0 | 0 | ||||||||||||||
Ernest E. Jones | 11,566 | 60,897 | 114,750 | 0 | 0 | |||||||||||||||
Kirk R. Oliver | 14,418 | (7) | 0 | 0 | 56,250 | (7) | 0 | |||||||||||||
Anne Pol | 4,867 | 119,365 | 114,750 | 0 | 2,281 | |||||||||||||||
M. Shawn Puccio | 6,525 | 25,560 | 76,500 | 0 | 0 | |||||||||||||||
Marvin O. Schlanger | 37,086 | (8) | 100,245 | 114,750 | 1,000 | (8) | 4,117 | |||||||||||||
Jerry E. Sheridan | 1,052 | (9) | 0 | 192,750 | 38,639 | (10) | 49,260 | |||||||||||||
Roger B. Vincent | 15,000 | (11) | 39,745 | 114,750 | 6,000 | (11) | 0 | |||||||||||||
John L. Walsh | 320,766 | (12) | 0 | 340,289 | 7,000 | (12) | 0 | |||||||||||||
Directors and executive officers as a group (15 persons) | 1,229,772 | 377,196 | 2,556,460 | 67,639 | 55,658 | |||||||||||||||
| (1) | Sole voting and investment power unless otherwise specified. |
| (2) | The 2004 Plan and the 2013 Plan each provides that stock units will be converted to shares and paid out to Directors upon their retirement or termination of service. |
| (3) | The AmeriGas Propane, Inc. 2010 Long-Term Incentive Plan on behalf of AmeriGas Partners, L.P. provides that phantom units will be converted to common units and paid out to Directors upon their retirement or termination of service. |
| (4) | Mr. Greenberg holds 376,228 shares jointly with his spouse and 163,465 shares in a charitable trust for which Mr. Greenberg and his spouse are co-trustees. |
| (5) | 5,250 of these shares are held by a family partnership, of which Mr. Hall’s spouse is a 25% beneficial owner, and Mr. Hall holds 19,753 of these shares in his 401(k) Savings Plan. |
| (6) | Mr. Hermance holds these shares jointly with his spouse. |
| (7) | Mr. Oliver holds 3,255 shares jointly with his spouse and 426 shares in his 401(k) Savings Plan. Mr. Oliver’s spouse holds all common units shown. Mr. Oliver disclaims beneficial ownership of the common units held by his spouse. |
| (8) | Mr. Schlanger’s spouse holds 3,000 shares and all common units shown. Mr. Schlanger disclaims beneficial ownership of the shares and common units owned by his spouse. |
| (9) | Mr. Sheridan holds these shares in his 401(k) Savings Plan. |
| (10) | Mr. Sheridan holds 38,639 common units jointly with his spouse. |
| (11) | Mr. Vincent’s shares and common units are held in a family trust for which Mr. Vincent’s spouse is a trustee. Mr. Vincent disclaims beneficial ownership of the shares and common units held in the family trust. |
| (12) | Mr. Walsh’s shares and common units are held jointly with his spouse. |
Section 16(a) of the Exchange Act requires our Directors, certain officers and 10 percent beneficial owners to report their ownership of shares and changes in such ownership to the SEC. Based on UGI Corporation’s Executive Compensation
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| SECURITIES OWNERSHIPOF CERTAIN BENEFICIAL OWNERS |
The following table shows information regarding each person known by the Company to be the beneficial owner of more than five percent of the Company’s common stock. The ownership information below is based on information reported on a Form 13F as filed with the SEC in November 2014 for the quarter ended September 30, 2014.
Securities Ownership of Certain Beneficial Owners
Title of Class | Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percent of Class(1) | |||||||
Common Stock | Wellington Management Company, LLP 280 Congress Street Boston, MA 02210 | 18,654,190(2) | 10.82% | |||||||
Common Stock | The Vanguard Group, Inc. P.O. Box 2600 Valley Forge, PA 19482 | 13,099,442(3) | 7.60% | |||||||
Common Stock | State Street Corporation One Lincoln Street Boston, MA 02111 | 9,470,500(4) | 5.49% | |||||||
| (1) | Based on 172,273,781 shares of common stock issued and outstanding at September 30, 2014. |
| (2) | The reporting person, and certain related entities, has shared voting and shared investment power with respect to 1,574,397 shares, sole voting power with respect to 11,628,963 shares, and sole investment power with respect to 17,079,793 shares. |
| (3) | The reporting person, and certain related entities, has sole voting power with respect to 113,688 shares and sole investment power with respect to 13,000,104 shares. |
| (4) | The reporting person, and certain related entities, has sole voting power and shared investment power with respect to 9,470,500 shares. |
| ITEM 2 — ADVISORY VOTEON UGI CORPORATION’S EXECUTIVE COMPENSATION |
Pursuant to Section 14A of the Exchange Act, the Company is providing shareholders with the opportunity to cast an advisory, non-binding vote to approve the compensation of our named executive officers. The compensation of our named executive officers is disclosed under the headingsCompensation Discussion and Analysisand Compensation of Executive Officers,, beginning on pages 2520 and 5141 of this proxy statement,Proxy Statement, respectively.
We believe that we closely align the interests of our named executive officers and our shareholders. As described in ourCompensation Discussion and Analysis,, our compensation program for our named executive officers is designed to provide a competitive level of total compensation, to motivate and encourage our executive officers to contribute to the Company’s success and to effectively link our executives’ compensation to our financial performance and sustainable growth in shareholder value. OurCompensation Discussion and Analysis also describes in detail the components of our executive compensation program and the process by which, and the reasons why, the independent members of our Board of Directors and our Compensation and Management Development Committee make executive compensation decisions.
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In making executive compensation decisions, our Compensation and Management Development Committee seeks to implement and maintain sound compensation and corporate governance practices, which include the following:
Our Compensation and Management Development Committee is composed entirely of directors who are independent, as defined in the corporate governance listing standards of the New York Stock Exchange.
Our Compensation and Management Development Committee utilizes the services of Pay Governance LLC (“Pay Governance”), an independent outside compensation consultant.
The Company allocates a substantial portion of compensation to performance-based compensation. In Fiscal 2011, 80%2014, 84% of the principal compensation components, in the case of Mr. Greenberg,Walsh, and 62%66% to 74%76% of the principal compensation components, in the case of all other named executive officers, were variable and tied to financial performance or total shareholder return.
The Company awards a substantial portion of compensation in the form of long-term awards, namely, stock options and performance units, so that executive officers’ interests are aligned with shareholders’ interests and long-term Company performance.
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We require termination of employment for payment under our change in control agreements (referred to as a “double trigger”). We also have not entered into change in control agreements providing for tax gross-up payments under Section 280G of the Internal Revenue Code since 2010. See COMPENSATION OF EXECUTIVE OFFICERS — Potential Payments Upon Termination or Change in Control.
We have meaningful stock ownership guidelines. See COMPENSATION OF EXECUTIVE OFFICERS — Stock Ownership Guidelines.
We have a recoupment policy for incentive-based compensation paid or awarded to current and former executive officers in the event of a restatement due to material non-compliance with financial reporting requirements.
We have a policy prohibiting the Company’s Directors and executive officers from (i) hedging the securities of UGI Corporation and AmeriGas Partners, (ii) holding UGI Corporation and AmeriGas Partners securities in margin accounts as collateral for a margin loan, and (iii) pledging the securities of UGI Corporation and AmeriGas Partners.
This vote is advisory, which means that the vote on executive compensation is not binding on the Company, our Board of Directors or the Compensation and Management Development Committee. The vote on this resolution is not intended to address any specific element of compensation, but rather relates to the overall compensation of our named executive officers. The Board of Directors and the Compensation and Management Development Committee expect to take into account the outcome of this vote when considering future executive compensation decisions and will evaluate whether any actions are necessary to address shareholders’ concerns, to the extent a significant number of our shareholders vote against our compensation program.
Accordingly, we ask our shareholders to vote on the following resolution at the Annual Meeting:
RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including ourCompensation Discussion and Analysis,, compensation tables, and the related narrative discussion, is hereby APPROVED.
The Board of Directors of UGI Corporation unanimously recommends a vote FOR the approval of the compensation paid to our named executive officers, as disclosed in theCompensation Discussion and Analysis,, the compensation tables and the related narrative discussion in this Proxy Statement.
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| ITEM 3 — RATIFICATIONOF APPOINTMENTOF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM |
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The Board of Directors of UGI Corporation unanimously recommends a vote FOR this proposal.
| ITEM 4 — OTHER MATTERS |
The Board of Directors is not aware of any other matter to be presented for action at the meeting. If any other matter requiring a vote of shareholders should arise, the Proxies (or their substitutes) will vote in accordance with their best judgment.
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DIRECTIONSTO THE DESMOND HOTELAND CONFERENCE CENTER
Directions from South Jersey.Take I-95 South to Route 322 West. Take 322 West to Route 1 South to Route 202 North. Take Route 202 North to Great Valley/Route 29 North Exit. At the end of the ramp, turn right onto Matthews Road. Turn right at the next light onto RouteMorehall Road (Route 29 North.North). Turn right at second light onto Liberty Boulevard. The Desmond will be on the left.
Directions from Philadelphia Airport. Take I-95 South to 476 North. Follow 476 North to the Schuylkill Expressway (I-76) West to Route 202 South. Take Route 202 South to the Great Valley/Route 29 North Exit. At the end of the ramp, proceed through the light onto Liberty Boulevard. The Desmond will be on the right.
Directions from Wilmington and Points South (Delaware and Maryland).Take I-95 North to Route 202 North to the Great Valley/Route 29 North Exit. At the end of the ramp, turn right onto Matthews Road. Turn right at the next light onto RouteMorehall Road (Route 29 North.North). Turn right at second light onto Liberty Boulevard. The Desmond will be on the left.
Directions from New York and Points North. Take the New Jersey Turnpike South to Exit 6, theI-276, Pennsylvania Turnpike extension.connector. Follow the Turnpike I-276 West to Exit 326, Valley Forge. Take the first exit, Route 202 South to the Great Valley/Route 29 North Exit. At the end of the ramp, proceed through the light onto Liberty Boulevard. The Desmond will be on the right.
Directions from Harrisburg and Points West.Take the Pennsylvania Turnpike, I-76, East to Exit 326, Valley Forge. Take Route 202 South to Great Valley/Route 29 North Exit. At the end of the ramp, proceed through the light onto Liberty Boulevard. The Desmond will be on the right.
E-Z Pass Holders:Take the Pennsylvania Turnpike, I-76, to Exit 320, Malvern (Exit 320 is an electronic interchange for E-Z pass holders only.) At the end of the ramp, turn left at the traffic light onto Morehall Road (Route 29 South) toward Malvern. Proceed on Morehall Road (Route 29 South) to the third traffic light at Liberty Boulevard. Turn left onto Liberty Boulevard and The Desmond Hotel will be on your left.
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| IMPORTANT ANNUAL MEETING INFORMATION |
| Using ablack ink pen, mark your votes with anX as shown in this example. Please do not write outside the designated areas. | x |
Electronic Voting Instructions
Available 24 hours a day, 7 days a week!
Instead of mailing your proxy, you may choose one of the voting methods outlined below to vote your proxy.
VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.
Proxies submitted by the Internet or telephone must be received by 9:00 a.m., Eastern Standard Time, on January 29, 2015.
 | ||||||||||
 |  | |||||||||
• | Go to | |||||||||
• | Or scan the | |||||||||
| QR code with your smartphone | ||||||||||
• |  | |||||||||
Follow the steps outlined on the secure | ||||||||||
Vote by telephone
| • |  | |||||||||
| • | ||||||||||
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▼qIF YOU HAVE NOT VOTED OVER THE INTERNETOR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.▼q
| A | Proposals — The Board of Directors recommends that you voteFOR Numbers 1, 2 and | |||||||||
1. | Election of Directors: | 01 - R.W. Gochnauer 04 - E.E. Jones 07 - M.O. Schlanger | ||||||||||
02 - L.R. Greenberg 05 - A. Pol 08 - R.B. Vincent | 03 - 06 - M.S. Puccio 09 - J.L. Walsh |
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| 01 | 02 | 03 | 04 | 05 | 06 | 07 | 08 | 09 | ||||||||||||||||
| ¨ | For AllEXCEPT - To vote against one or more nominees, mark the box to the left and the corresponding numbered box(es) to the right. | ¨ | ¨ | ¨ | ¨ | ¨ | ¨ | ¨ | ¨ | ¨ |
| For | Against | Abstain | ||||||||
| 2. | Proposal to approve resolution on executive compensation. | ¨ | ¨ | ¨ | ||||||
| For | Against | Abstain | ||||||||
| 3. | Ratification of Appointment of Ernst & Young LLP as our independent registered public accounting firm. | ¨ | ¨ | ¨ | ||||||
| B | Non-Voting Items | |||||||||
| Change of Address— Please print new address below. | Comments— Please print your comments below. | |||||||||
| o | Mark here to vote FOR all nominees | o | Mark here to WITHHOLD vote from all nominees | |||||||||||||||||||||||||||||||||||||||
| 01 | 02 | 03 | 04 | 05 | 06 | 07 | 08 | 09 | 10 | |||||||||||||||||||||||||||||||||
| o | For AllEXCEPT - To withhold a vote for one or more nominees, mark the box to the left and the corresponding numbered box(es) to the right. | o | o | o | o | o | o | o | o | o | o | |||||||||||||||||||||||||||||||
| For | Against | Abstain | 1 Year | 2 Years | 3 Years | Abstain | ||||||||||||||||
| 2. | Proposal to approve resolution on executive compensation. | o | o | o | 3. | Recommend the frequency of future advisory votes on executive compensation. | o | o | o | o | ||||||||||||
| For | Against | Abstain | ||||||||||||||||||||
| 4. | Ratification of Appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm. | o | o | o |
| C | ||||||||||
| Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below | ||
Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.
| Date (mm/dd/yyyy) — Please print date below. | Signature 1 — Please keep signature within the box. | Signature 2 — Please keep signature within the box. | ||||||
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| ¢ | 1 U PX | U G I 1 | + |
Proxy — UGI CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF UGI CORPORATION
The undersigned hereby appoints Marvin O. Schlanger, Lon R. Greenberg and Stephen D. Ban,John L. Walsh, and each of them, with power to act without the other and with power of substitution, as proxies and attorneys-in-fact and hereby authorizes them to represent and vote, as provided on the other side, all the shares of UGI Corporation Common Stock which the undersigned is entitled to vote, and, in their discretion, to vote upon such other business as may properly come before the Annual Meeting of Shareholders of the Company to be held January 19, 201229, 2015 or at any adjournment thereof, with all powers which the undersigned would possess if present at the Meeting.
For the participants in the UGI Utilities, Inc. Savings Plan, AmeriGas Propane, Inc. Savings Plan, and the UGI HVAC Enterprises, Inc. Savings Plan (together, the “Plans”), this Proxy Card will constitute voting instructions to the Trustee under the Plans, as indicated by me on the reverse side, but, if I make no indication as to a particular matter, then as recommended by the Board of Directors on such matter, and in their discretion, upon such other matters as may properly come before the Meeting. The Trustee will keep my vote completely confidential. If the Trustee does not receive my executed Proxy by January 16, 2012,26, 2015, I understand the Trustee will vote the shares represented by this Proxy in the same proportion as it votes those shares for which it does receive a properly executed Proxy.
(Continued, and to be marked, dated and signed, on the other side)
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