Ad Hoc Pricing Committee Members in 2022: Members:
Jeffries SheinJames F. Cosgrove, Jr. Ann L. Noble Walter G. Reinhard, ex officio
Independent Members:2 3 Meetings Held in 2015:2022:0 | Ad Hoc Pricing Committee Responsibilities The ad hocAd Hoc Pricing Committee meets, as needed, to review financial matters including, but not limited to, the pricing and issuance of equity and long-term debt securities. Middlesex Water Company 15 2016 Proxy Statement
DIRECTOR COMPENSATION AND EQUITY OWNERSHIP GUIDELINES
Director Compensation
For 2015, Middlesex Water Company compensated each of the Board members who are not employed by the Company (“outside Directors”) with a Common Stock award valued at $15,000. In addition, Board members received an annual retainer of $15,000 and are compensated for attendance at Committee meetings. Mr. Doll, Chairman of the Board and an Executive Officer of the Company, receives no fee or common stock award for his service as a member of the Board or the Boards of the Company’s subsidiaries. The table below sets forth the annual retainers for 2015.
Position | | Annual Retainer | Outside Director | | $15,000 | Supplemental Retainer | | | Lead Director |
Middlesex Water Company 18 2023 Proxy Statement CORPORATE SUSTAINABILITY | The Company continues to make progress in matters of ESG as part of our cur- rent and long term plans for sustainability. We believe being a good neighbor has a positive impact on our stakeholders. We’re committed to the highest standards of ethical behavior, further growing diversity, equity and inclusive- ness in our workforce and our Board, making prudent investments in aging infrastructure, maintaining public health, safety and economic stability in the communities we serve and serving as a trusted and reliable resource to our customers and communities. Our approach to corporate social responsibility includes capturing ESG metrics that connect to our business strategies, foster accountability and enhance operational performance. These generally relate to the following areas: • Protecting the health and safety of our employees and customers through training, education and emergency planning and preparedness as well as quality water treatment to protect public health • Making investments in infrastructure which mitigate against climate impact and result in enhanced service delivery, reliability and resiliency • Upholding good governance practices centered around policies, procedures and best practices • Supporting our people and actively engaging with the communities we serve Our Approach We strive to: ✔ Foster accountability through improved alignment around ESG areas and expanded Board and management oversight of ESG risk ✔ Report on metrics and developments that connect to our business strategies and are relevant to stakeholders ✔ Strengthen our organizational frameworks to enhance year over year disclosure ✔ Engage external stakeholders to better understand ESG expectations ✔ Continually improve transparency and disclosure on material topics ✔ Consistently integrate ESG aspects into our decision making and planning ✔ Analyze data collected to effect continual improvement The Company’s Corporate Sustainability Report and the ESG section on our web- site demonstrates an ongoing commitment to ESG and continual improvement. It offers an overview of steps we are taking in the areas of governance and compliance, cybersecurity, social impact, diversity and inclusion, environmental stewardship and network resiliency, to better support our people, our environment and the communities we serve. To view our most recent ESG progress highlights, please visit www.middlesexwater.com/environmental-social-and- governance | | | $ 5,000 | Chair of Audit Committee | | $ 7,500 |
Middlesex Water Company 19 2023 Proxy Statement Sustainability Highlights of 2022 Middlesex continued to monitor our environmental footprint while placing public health at the forefront making prudent investments to enhance water quality and support system reliability. | • | Middlesex invested $10 million to replace 22,500 linear feet of aging water main as well as 583 service lines, valves and 21 fire hydrant replacements. | Chair of Compensation Committee | | $ 5,000 |
| • | Middlesex began a utility-wide program to remove all lead and galvanized steel service lines on the customer and utility side by 2031. The Company will be working on a neighborhood-by-neighborhood basis to replace lead service lines, factoring in planned construction activities and prioritizing geographic areas based on the most vulnerable areas that serve a large number of at-risk individuals. | All other Chairpersons | | $ 2,500 |
| • | Progress continues on construction of a upgraded treatment plant to treat PFAS (per- and polyfluoroalkyl substances). Middlesex’s Park Avenue wellfield tested above new health-based standards in late 2021. The Company promptly notified customers of the exceedance and was able to switch to alternate drinking water sources by November 2021. By June 2022, Middlesex began successfully treating ground water for PFAS compounds with its Phase 1 construction of an advanced treatment facility at its Park Avenue wellfield which continues to effectively treat ground water in compliance with all state and federal drinking water standards. Despite lingering challenges in the supply chain, the full treatment facility project remains on target for completion in June 2023. |
| • | Committed to sound environmental principles, environmental impact is considered when performing upgrades to our operating facilities. These practices include converting away from fuel oil for heating, adding variable frequency drives on large pumps, utilizing energy efficient lighting, etc. |
| • | Middlesex worked to minimize its carbon footprint implementing numerous initiatives including: |
| – | Upgrading its Oracle Mobile Workforce management application resulting in more efficient dispatching, reduced travel time and vehicle usage |
| – | Implementing hybrid work schedules which facilitating increased remote working capability and teleconferencing, thereby reducing employee commuting. |
| – | Initiating design of remote charging stations to support the company’s migration to electric vehicles |
| – | Installation of devices in company vehicles which help monitor safety as well as help manage vehicle usage and fuel consumption |
| – | Advocating wise water use to customers though promotion of WaterSense water efficient products. |
| • | In analyzing the impact of the environment on our operations, as part of hurricane/storm preparedness activities, crews cleared, cut and removed very large tree hazards and vegetative overgrowth which could pose a threat to critical water storage facilities. |
Our approach to employee engagement, safety, training and diversity, equity and inclusion are critical investments in human capital that help promote an agile and engaged workforce and support the sustainability of our business. We work to serve as a trusted resource to our customers and local governments, build stronger communities through active participation and by providing a solid water delivery framework that drives economic stability, prosperity and quality of life. | • | Provided employees a robust compensation and benefits package to support their health and well-being. These include flexible/hybrid work arrangements, monthly health, self-care, mindfulness and wellness tips, incentive exercise programs, mental health and Employee Assistance Programs, sit/stand desks, on-site flu shot clinics and convenient on-site mammograms, First Aid and CPR Safety courses, as well Defensive Driving classes. |
| • | With increasing cyberthreats to utilities in general, Middlesex worked to continually strengthen cybersecurity awareness in its employees through ongoing training on how to recognize common security risks, frequent bulletins, and by recognizing good day-to-day cybersecurity hygiene through employee recognition. |
| • | To ensure compliance with regulatory agency and review alignment to industry standards such as NIST (National Institute of Standard and Technology), the Board of Directors has commissioned a comprehensive audit of our IT networks. The audit which is scheduled for 2023, will include a comprehensive review of cyber security policies, procedure and practices. |
| • | Middlesex earned a Risk Management Excellence Award from PMA Insurance Group honoring the Company’s strong organizational commitment to employee safety over the past few years. |
| • | With a goal of ensuring safety is at the focus, Middlesex hosted Safety/ Practical Days where operations personnel rotated to different safety instructional stations learning about Hydrants, fittings, traffic safety and flagging, shoring, gas monitor and pump training and guillotine saw handling. |
| • | To reduce driving accidents and reinforce better driver behavior, Middle- sex implemented numerous driver safety programs. A GPS fleet tracking system has been installed which enhances driver awareness, promotes greater driver accountability behind the wheel and promotes safe driving habits. All company service vehicles include a sticker reminding occupants to conduct a full 360 inspection of the vehicle prior to entering. |
| • | To better support the Company’s response to emergencies and mitigate impact on customers, the position of Emergency Preparedness, Safety & Security Manager was created. This professional works with our Emergency Management and Security Committee to ready the Company for emergencies and climate events such as storms, floods, as well as fires, pandemics, prolonged power outages and more. |
Middlesex Water Company 20 2023 Proxy Statement Sustainability Highlights of 2022 Cont’d. | • | To further cultivate strong relationships with local law enforcement and first responders as well as local, state and federal Emergency Management agencies and local government, we conducted facility tours for these key stakeholders to emphasize the criticality of our infrastructure so appropriate response plans are developed to help keep the public and our employees safe in an emergency. |
| • | Intent on integrating Diversity, Equity & Inclusion (DEI) principles which are consistent with our company culture, the Company formalized a Statement on Diversity, Equity and Inclusion which can be viewed on |
its website. | • | DEI Training, including “Moving from Bias to Inclusion in a DEI Journey” was delivered to all employees. |
| • | Middlesex CEO Dennis Doll joined CEO Action for Diversity and Inclusion which encourages companies to cultivate environments that support dialogue on DEI, implement and expand bias education and training and engage board of directors in the development and evaluation of inclusion and diversity strategies. |
| • | Middlesex implemented an applicant tracking system which enables candidates to apply for jobs online fairly and equitably. |
| • | We continue to be intentional in our efforts to attract job candidates from historically marginalized groups and seek a diverse pool of candidates for apprenticeships and internship opportunities. |
The Board of Directors maintains overall oversight of the Company’s business strategy while the Corporate Governance and Nominating Committee oversees matters related to ESG and overall sustainability including Enterprise Risk Management. We seek to mitigate risks related to environmental impact and climate variability, workforce safety, cybersecurity, and work to actively promote diversity, equity and inclusion. Management discusses all matters or risks, including ESG challenges and incremental progress toward sustainability regularly with the Corporate Governance and Nominating Committee. | • | We continue to review committee accountabilities on the board level ensuring that risks related to climate change, cybersecurity, human capital were well delineated. |
| • | We seek directors who are committed to representing the interests of shareholders, who combine a broad spectrum of experience and who have a diverse skill set and a reputation for collaboration, leadership and integrity. |
| • | Except for our CEO, all directors are independent, including our Lead Director. Board committees are 100% independent. |
| • | Board committee meeting fees for outside Directors amounted to $750 per Director for each Board committee meeting attended. In the event a Special Board or a Committee meeting attended via teleconference is held, the meeting fees for outside Directorsand director performance evaluations are $400 and $200 per meeting, respectively.Director Compensation Table
The following table details Director compensation earned during 2015.
Name | Fees earned or paid in cash ($) | Common Stock Awards ($) | Total Compensation ($) | James F. Cosgrove, Jr. | 25,200 | 15,000 | 40,200 | John C. Cutting (1) | 7,250 | 15,000 | 22,250 | Kim C. Hanemann (2) | | | | Steven M. Klein | 30,200 | 15,000 | 45,200 | Amy B. Mansue | 30,450 | 15,000 | 45,450 | John R. Middleton, M.D. | 24,000 | 15,000 | 39,000 | Walter G. Reinhard | 26,200 | 15,000 | 41,200 | Jeffries Shein | 26,000 | 15,000 | 41,000 |
(1)Dr. John C. Cutting, Ph. D. retired from the Board as of May 26, 2015.
(2) Kim C. Hanemann was named to the Board on January 26, 2016.
Director Equity Ownership
As part of their annual compensation, each Director receives Company common stock valued at $15,000. The Board believes that all Directors should maintain a meaningful ownership stake in the Company to underscore the importance of aligning their long-term interests with those of our shareholders. Directorsconducted annually.
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| • | All employees are required to hold common stock valued at least three times the amountannually review, sign and attest to a Code of the annual retainer by the fifth anniversary of Board membership. All Conduct and Insider Trading policy. |
| • | Board members met this requirementreceive ongoing director education. |
| • | Company Statements on Diversity, Equity and Inclusion, our Human Rights Policy and Whistleblower Hotline can be readily found on our website. |
| • | Stock ownership requirements are in place for 2015.Board members and executive management. |
Middlesex Water Company 21 2023 Proxy Statement Our Approach to Executive Compensation Middlesex Water Company 16 2016 Proxy Statement
Our Approach to Executive Compensation
What We Do | x☑ | Executive Compensation Philosophy |
We maintain an Executive Compensation Philosophy that details overall compensation goals and objectives as well as the approachbalance our need to each element of compensation. The Philosophy is reviewed and approved by the Compensation Committee on an annual basis.appropriately serve our customers against our need to deliver long-term shareholder value. We benchmark total compensation to the 50th percentile of our comparator group. | x☑ | Align Pay with Our Performance |
Budgeted Income Before Income Taxes is the financial metric on which incentive compensation is based for Named Executive Officers (NEOs). Such annual target amount is approved by the Board. Incentive compensation awards to NEOs, other than the CEO, are based 60% on achieving the financial metric and 40% on achievement of operational, service, growth and other non-financial metrics. The CEO’s incentive awards are based 80% on achieving the financial metric and 20% on operational, service, growth and other non-financialnon- financial metrics.
| x☑ | Focus on Long-Term Goals |
One element of our Compensation Philosophy is thatWe believe our incentive compensation program should be simple, transparent and easily understood by shareholders, analysts, regulators and other interested parties. Our incentive compensation program is administered substantially in the form of a long-term benefit through restricted shares of Common Stock with a five-year cliff-vestingcliff- vesting schedule. A modest short-term benefit is provided through the dividends on the awarded restricted Common Stock for the five-year period untilduring which the shares are vested.unvested.
| x☑ | Require Stock Ownership |
The Chief Executive Officer is required to beneficially hold shares of Common Stock equal in value to at least 3.0 times base salary. The Chief Financial Officer and Chief Operating Officer areis required to beneficially hold 1.5 times base salary. All other NEOs are required to beneficially hold 1.0 times base salary.salary and all NEOs are to hold the required shares by their fifth anniversary of their designation as NEOs. Directors are required to hold 3.0 times their annual retainer by the fifth anniversary of their Board service.membership. | x☑ | Regularly Review our Comparator Group |
We regularly review our designated comparator group to ensure our compensation program is properly aligned with the peers whose relative size, operations, regulatory requirements and other relevant characteristics are reasonably comparable to ours. What We Do Not Do | x⊘ | No Risky or Complicated Programs |
We do not engage in compensation programs that create undue risk or are difficult to assess how effectively incentive targets were achieved. | x⊘ | No Hedges of, or Liens on, our Common Stock |
We prohibit the pledging of, or hypothecating, or otherwise placing a lien on, any Common Stock or other equity interest of the Company. | x⊘ | No Employment Contracts |
All employees of the Company, including NEOs, are “at will employees.” All NEOs of the Company do however, have Change of Control Agreements deemed to incent management to actively represent the interest of shareholders in contemplation of a change in control. | x⊘ | No Definitive Retention of Restricted Stock Award – Subject to Clawback |
Under our “clawback” policy, we do not allow any recipient of previously-awarded restricted Common Stock to retain the amount of such awards, which were based on achievement of financial metrics, that would have been invalidated by a restatement of financial statements. | x⊘ | No Repricing or Cash Buyouts of Restricted Stock Awards |
We do not reprice or buy out unvested restricted Common Stock awards. Middlesex Water Company 17 2016 22 2023 Proxy Statement
EXECUTIVE COMPENSATION Compensation Committee Report The Compensation Committee has reviewed and discussedapproved the Compensation Discussion and Analysis with management, and based on this review and discussion, has recommended to the Board that it be included in this Proxy Statement. COMPENSATION DISCUSSION AND ANALYSIS Note: The Compensation Committee and the full Board continually evaluate our executive compensation program to ensure it fulfills the key objectives of our executive compensation philosophy, aligns with key operational and sustainability objectives and serves the overall best interests of our customers and our shareholders. Introduction The following Compensation Discussion and Analysis (“CD&A”) provides a detailed description of our executive compensation objectives, philosophy, practices and programs, as well as how the Compensation Committee determines executive compensation under those programs.programs to motivate and retain a qualified senior leadership and to ensure alignment with shareholder value creation. Our CD&A focuses onaddresses the compensation of our Named Executive Officers (NEOs) that was paid, or earned, in 2022. Those NEOs for calendar year 2015 who were:include: 1) Dennis W. Doll, President and Chief Executive Officer, (2)2) A. Bruce O’Connor, Senior Vice President, Treasurer and Chief Financial Officer, (3) Richard M. Risoldi,3) Jay L. Kooper, Vice President, – OperationsGeneral Counsel & Secretary, 4) Georgia M. Simpson, Vice President - Information Technology and Chief OperatingTechnology Officer, (4) Gerard L. Esposito,and 5) Robert K. Fullagar, Vice President – Tidewater Utilities, Inc.- Operations. Executive Summary Middlesex Water Company owns and (5) Bernadette M. Sohler, Vice President– Corporate Affairs. Executive Summary
operates regulated water and wastewater utility systems in New Jersey and Delaware. The objectiveCompany also operates water and wastewater utility systems under contract on behalf of our executive compensation program ismunicipal, industrial and commercial clients. In 2022, we continued to aligninvest in regulated utility infrastructure for the interests of our senior leadership with thosebenefit of our customers, worked to enhance safety and the skills of our workforce, made continued progress towards sustainability and built value for our shareholders. The key components of the Company’s compensation program are designed augmented and modified, as appropriate, to ensure we attract and retain qualified executive talent and appropriately reward financial and operational performance. We continually strive to maintain a compensation program that provides an adequate balance between shortershorter- and longer-term operational and financial performance.objectives and related results. Our 20152022 compensation program was designed to be benchmarked as to:to base salaries, incentive compensation and total compensation. Base salaries
Incentive compensation
Perquisites and
Total compensation
The Company remains committed to a disciplined and balanced approach to meeting the short- and long-term needs of shareholders, customers shareholders and employees. This compensation philosophy is consistent with the Company’s risk management philosophy. The Company’s formal Enterprise Risk Management program seeks to eliminate, mitigate transfer or eliminatetransfer risk while simultaneously maximizing opportunity for shareholders and maintaining appropriate quality service for the Company’s customers. The Corporate Governance and Nominating Committee has formal responsibility for oversight of the Enterprise Risk Management Program in addition to our ESG initiatives. The Company’s compensation program seeks to achieve an appropriate balance among all these objectives and therefore, does not encourage or reward inappropriate risk-taking. Compensation Program Oversight The Compensation Committee is responsible for making recommendations to the full Board with respect to the compensation of the NEOs. As part of these duties, the Committee: | þ• | administersAdministers the Company’s equity-based incentive compensation plan |
| þ• | conductsConducts an annual formal performance reviewevaluation of the Chief Executive Officer and, |
| þ• | in consultationIn Consultation with the Chief Executive Officer, reviews the performance of the other NEOs and other Officers of the Company. The Board has the ultimate authority to determine the compensation of all NEOs, in addition to those Officers who are not NEOs for purposes of Proxy reporting. |
The Board has ultimate authority to determine the compensation of all NEOs, in addition to those Officers who are not NEOs, for purposes of Proxy reporting.
The Compensation Committee is governed by a formal charter that describes the Committee’s scope of authority and responsibility. The Compensation Committee consists of Directors, who are all “independent”“independent,” as set forth in the listing requirements for the Nasdaq Stock Market where Middlesex Water Company is listed as a Nasdaq Global Select securities.Company. The Corporate Governance and Nominating Committee evaluates the independence of Committee members at least annually, using standards no less restrictive than those contained in the Nasdaq Global Select listing requirements. This evaluation, and the determination that each member of the Committee is independent, was made most recently in February 2016.April 2023. Role of Executives in Compensation Committee Activities.Activities The executive officers who serve as a resource to the Compensation CommitteeCommit- tee are the Chief Executive Officer and the Vice President-HumanPresident, Human Resources. These executives provide the Compensation Committee with data regarding market-based compensation philosophy, processes and practices related to human capital management including developing, attracting and retaining personnel, succession planning, company culture and employment practices. This communication assists the Committee in the design and implementation of the Company’s compensation programs. In addition to providing factual information,in- formation, such as Company-wide performance on relevant measures, these executives articulate management’s views and results on current compensation programs and processes, recommend relevant performance measures to be used for future evaluations and otherwise supply information to assist the Compensation Committee. Additional resources used by the Compensation Committee in their deliberations are provided by outsideindependent third-party sources, as well as by individual Committee or other Board members. The Chief Executive Officer also provides information about individual performance assessments for the other NEOs, and expresses to the Compensation Committee views on the appropriate levels ofrecommendations for changes in compensation for all Officers of the Company, including the other NEOs,than himself, based on individual performance. The Compensation Committee periodically communicates directly with independent third-party consultants, providing such consultants with Company-specific and market-based information. Certain portions of such information may be provided by the Vice President-HumanPresident - Human Resources or the Chief Executive Officer, in assisting in the evaluation of the estimated effect on the Company’s financial statementsresults of operations regarding any proposed changes to the various elements of compensation. Such a Middlesex Water Company 23 2023 Proxy Statement An executive compensation study was last completed in 2014 by Steven Hall & Partners.Partners, an independent firm specializing in executive compensation, in January 2022. Executives participate in Committee activities solely in an informational and advisory capacity, and have no vote in the Committee’s decision-making process. The Chief Executive Officer and Vice President-HumanPresident - Human Resources do not attend those portions of Compensation Committee meetings during which their performance is evaluated or their compensation is determined. No executive officer other than the Chief Executive Officer attends those portions of Compensation Committee meetings during which the performance of the other NEOs is evaluated or their compensation is determined. In addition, the Compensation Committee meets in executive session as it considers appropriate. Use of Consultants.Consultants The Compensation Committee periodically engages qualified independent compensation consultants to assist in the compensation process for NEOs. The consultants are retained by, and report directly to, the Compensation Committee. The Chair of the Compensation Committee serves as the designated primary contact with outside compensation consultants. The Compensation Committee places no restrictions on consultants within the scope of contracted services and such consultants are not engaged by management for any purpose. The consultants provide expertise and information about competitive trends in the employment marketplace, including established and emerging compensation practices at other companies both inside and outside the Company’s comparator group. The consultants also provide proxy statementProxy Statement and survey data, and assist in assembling relevant comparator groups. In addition, the consultants also assist in establishing benchmarks for base salary and incentives from the comparator group proxy statementProxy Statements and survey data. Middlesex Water Company 18 2016 Proxy Statement
In determining compensation for the NEOs in 2015, the Committee continued to rely on data from a comprehensive study presented in April 2014, performed by Steven Hall & Partners, as one element in their deliberations. Such information was supplemented by the Committee’s independent observations of current market conditions relative to the data in the 2014 study.
Compensation Program Objectives and Philosophy Objectives | • Attract, retain and appropriately motivate employees • Compensate executives for long-term improvement in overall shareholder value • Provide differentiated executive pay based on experience, assigned responsibilities and performance • Support the attainment of short and long-term financial and strategic objectives |
The methods used to achieve the compensation program objectives for NEOs are influenced by the compensation and employment practices of a comparator group, as adopted in consultation with the Company’s independent executive compensation consultant. Other considerations include each NEO’s individual performance in achieving both financial and non-financial corporate objectives. Our program is designed to compensate the NEOs based on their level of assigned responsibilities, individual experience and performance levels and their knowledge and management of the Company’s operations. The creation of long-term value is highly dependent on the development and effective execution by our NEOs of our business strategy. Factors that influence the design of our executive compensation program include, among other things, thevarious items listed as follows: We operate primarily in a highly regulated utility industry with regard to public health and safety, the environment, service levels to our customers and the rates for utility services that are charged to our customers. We value industry-specific experience that promotes safe, proper and reliable utility services for our customers;
We value our executives’ ability to appropriately balance the short- and long-term needs of our customers, our employees and our shareholders. We seek to not only provide safe, proper and reliable utility services on a current basis for our customers, but we also plan and execute strategies that promote the sustainability of critical utility services into the future. In addition, we simultaneously seek to provide financial returns for our shareholders that appropriately reflect the risks and opportunities that are inherent in meeting the short- and long-term needs of our customers, and that are inherent in the provision of our utility services. We work to appropriately recognize further contributions to shareholder value achieved through contract operations and other complementary business opportunities that are not traditional regulated public utilities and therefore, not regulated by a state public utility commission as to customers’ rates;
We value our executives’ ability to attract, retain and continually develop a workforce that ensures critical technical and management skills are maintained in sufficient quantity and quality.
| • | We operate primarily in a highly regulated utility industry with regard to public health and safety, the environment, service levels to our customers and the rates for utility services charged to our customers. We value industry-specific experience that promotes safe, proper and reliable life-sustaining utility services for our customers; |
| • | We value our executives’ ability to appropriately balance the short- and long-term needs of our customers, our employees and our shareholders. We seek to not only provide safe, proper and reliable utility services on a current basis for our customers, but we also plan and execute strategies that promote the sustainability of critical utility services into the future. Promotion of the sustainability of services also includes routine Compensation Committee discussions regarding the status of succession planning initiatives at both the executive and management levels. In addition, we simultaneously seek to provide financial returns for our shareholders that appropriately reflect the risks and opportunities inherent in meeting the short- and long-term needs of our customers, and inherent in the provision of our utility services. We work to appropriately recognize further contributions to shareholder value achieved through contract operations and other complementary business opportunities which are not traditional regulated public utilities and therefore, not regulated by a state public utility commission as to customers’ rates and service; |
| • | We value our executives’ ability to attract, retain and continually develop a workforce that ensures critical technical and management skills are maintained in sufficient quantity and quality. |
Our compensation program for NEOs includes three components: (1) base salary, (2) an equity-based long-term incentive plan in the form of restricted common stock and (3) perquisites at levels that are competitive in the marketplace and appropriate for the roles of the NEOs. The incentive-based component of our compensation program is designed to be clear, transparent and understandable to investors and recipients. This is intended to simplify analysis by our shareholders of the relationship of pay to performance as well as to emphasize the critical importance of a long-term focus in the water and wastewater utility industry on financial and operational performance. Components of Our Compensation Program The Compensation Committee analyzes the level and relative mix of the elements of executive compensation elements by component (e.g., base(base salary incentives, and benefits)incentives) and in the aggregate.aggregate as related to total compensation. The Compensation Committee has generally established the 50th percentile of peer comparators and survey data as the target for base salary, incentive compensation and total compensation. The Compensation Committee generally seeks to undertake a comprehensive review of the executive compensation program approximately every threetwo years. The Chief Executive Officer provides recommendations to the Committee relating to base compensation changes relative to the NEOs, other than himself. Based on this analysis, the Compensation Committee reviews, challenges and recommends each NEO’s compensation, subject to approval by the full Board. When evaluating the components comprising total compensation, the Compensation Committee considers among other things, general market practices and the alignment of incentive awards with strategic objectives and Company operational and financial performance. The Compensation Committee seeks to create appropriate incentives to promote service quality and shareholder value without encouraging behaviors thatwhich may result in inappropriate risk taking. Middlesex Water Company 24 2023 Proxy Statement Base Salary.Salary: Base salary is designed to provide a reasonable level of predictablepredict- able compensation commensurate with market standards of the position held, adjusted for specific job responsibilities assigned, individual experience and demonstrated performance.held. NEOs are eligible for periodic adjustments to their base salary based on these factors. The Compensation Committee reviews and recommends to the Board any base salary changes for NEOs, including the Chief Executive Officer.CEO. Adjustments are made upward or downward for each NEO’s specific experience, responsibilities and performance, estimated value in the marketplace and the Committee’s judgment of each NEO’s contribution to the success of the Company. Incentives.Incentives:The Company does not have anya formal plan or program that provides for cash or other form of short-term incentive compensation for NEOs other than dividends on restricted stock awards that are not yet vested. The Company has a long-term incentive plan in the form of restricted Company common stock (the Restricted Stock Plan). Awards under this plan are considered on an annual basis and are based on the achievement of certain financial and operational goals. The ultimate value of the compensation recognized from restricted shares issued is determined as of the date vesting occurs, generally five yearsoccurs. Generally, the Restricted Stock Plan provides for five-year cliff-vesting from date of award for all shares granted in any individual year. The value of shares awarded in any given year can either increase or decrease between the date of issue.issuance and the five-year vesting term. The Restricted Stock Plan provides for accelerated vesting in the case of a retirement. Shares fully vest for retirements occurring on or after age 65 or in the case of a Change In Control. There is no provision in the Restricted Stock Plan that specifically addresses re-pricing or cash buyouts relative to unvested restricted stock awards however, such practices are prohibited as a matter of policy and have never been employed.
There is no minimum holding/retention period for restricted shares that become fully vested. The Company does however have minimum stock ownership and holding requirements. See Stock Ownership and Holding Requirements on page 28. The Restricted Stock Plan is designed to compensate the NEOs for executing specific financial and non-financial elements of the Company’s business plan. The target award is comprised of a single corporate financial goal, in addition to one or more individual non-financial performance goals. The corporate financial goal, for 2014, for which incentive compensation was awarded in 2015,earned for 2022, was budgeted Income Before Income Taxes. Separate from this metric, a qualitative assessment of financial performance relative to the company’s peer group is made through an evaluation of the total shareholder return over a 5-year period, as presented as part of the Form 10-K. The corporate financial goal comprised 60% of the target award for NEOs other than the President and Chief Executive Officer,CEO, whose corporate financial goal comprised 80% of his target award. The remaining portion of the target award for all NEOs is based upon the level of achievement of the individual non-financial performance goals. The non-financial individual performance goals are intended to further incent the NEOs to implement operational, technical, management and other initiatives that benefit the Company’s customers and shareholders, and which require effort and achievement above and beyond what would normally be required as part of the NEO’s base job responsibilities. Middlesex Water Company 19 2016 Proxy Statement
The Compensation Committee evaluates the reasonableness of attaining designated incentive goals relative to the importance of such goals to the overall mission and strategies of the Company and the required effort to achieve such goals. The Committee recognizes that some level of calculated risk is required to achieve business objectives that ultimately benefit shareholders and customers; however,customers however; the Committee discourages taking risk that, in the judgment of the Board, is inappropriate relative to the expectations of our shareholders and regulators. Delivered performance during the applicable measurement period may exceed, or fall short, of the targets, resulting in the NEO potentially receiving an incentive award that is above or below the initial targeted level. Annual incentive awards granted in prior years are not taken into account by the Compensation Committee in the process of setting performance targets or in evaluating achievements for the current year. Incentive-based awards are subject to the Company’s “clawback” policy. Such policy requires that incentive-based awards are subject to return to the Company, in whole or in part, if a financial statement restatement occurs within the three calendar years subsequent to an award, wherebywhere such restatement effectively negates the previous achievement of financial targets that precipitated such prior award. Awards made to any and all NEOs are subject to the provisions of the clawback policy. Our policy prohibits any Director, NEO or NEOother Officer from buying or selling Company Common Stock without obtaining prior approval from our Corporate Secretary and General Counsel. This policy, as an element of the Company’s Insider Trading Policy, is designed to help assure that the Directors and NEOs will not trade in our securities at a time when they are in possession of inside information. In addition, our formal Insider Trading policy prohibits our Directors and NEOs from hedging the economic risk of stock ownership. In evaluating actual performance relative to the established corporate financial goal, the Compensation Committee may, at its discretion, exclude individual items that are either additive or deductive which are considered non-recurring in nature. Such items are generally presumed to be infrequent. In addition, the Compensation Committee may increase or decrease a Restricted Stock award based upon additional consideration of a NEO’s performance or achievements. Middlesex Water Company 25 2023 Proxy Statement Our Business and Strategy Operational expertise, business continuity planning and dedicated employees are critical to our ability to deliver uninterrupted utility service. Our Company’s strategy is designed to meet the expectations of customers and shareholders for the long term. Infrastructure investments we are making currently under our Water for Tomorrow® infrastructure investment campaign are designed to benefit current and future generations of customers. Diverse talent we are recruiting today and nurturing through training and professional development become the leaders of tomorrow. We drive accountability across our enterprise through a set of core values that drive daily decision-making. These core values of Respect, Integrity, Growth, Honesty and Teamwork serve as the standards by which our people operate and help ensure a diverse, equitable and inclusive workplace. We expect our teams to be accountable for upholding these values each and every day as we work to fulfill our mission. The basic tenets of our strategy for profitability & growth include:
» | Investment in projects, products and services that complement our core water and wastewater competencies |
» | Timely and adequate recovery of infrastructure investments and other costs necessary to maintain and continually improve service quality |
» | Prudent acquisitions of investor and municipally-owned water and wastewater utilities |
» | Execution of municipal and industrial water and wastewater systems contracts |
Our 2022 Company Performance We continued to strive to strengthen our reputation as a trusted service provider to our customers, and as a valued employer, while we worked to further enhance value to our shareholders. The results below demonstrate some key accomplishments during the year: ✔ | Commemorated the Company’s 125th anniversary with a dedication and tours of our ozone treatment plant in New Jersey which serves to mitigate disinfection by-products and treat for presently unregulated compounds of emerging concern. |
✔ | Accelerated construction of partial treatment at our Park Avenue Treatment Plant in New Jersey to effectively treat water from this valuable ground water source while complying with newly-enacted state drinking water standards. The completed upgrade to the Plant, is expected to be fully operational by June 2023. |
✔ | Awarded a 10-year operations and maintenance contract for the water, wastewater and storm water collection systems of the Borough of Avalon, New Jersey. |
✔ | Constructed two elevated one million gallon capacity storage tanks to help ensure reliable water supply to rapidly expanding communities in southern Delaware. |
✔ | Under New Jersey legislation, embarked on a lead service line replacement initiative aimed at reducing lead exposure through inventory and replacement of all lead and galvanized steel service lines owned by property owners or Middlesex by 2031. |
✔ | Achieved third party recognition for Risk Management excellence for the company’s strong track record of organizational commitment to employee safety. |
✔ | Marked the Company’s 50th year of consecutive dividend increases with a 7.76% increase. |
✔ | Established a Cross-Connection Control program to further protect the public drinking water supply in Delaware. |
✔ | Continued to focus on employee training and development supporting water apprenticeship programs and piloting a simulated Plant Operator training tool. |
✔ | Enhanced our Mobile Workforce Management platform which optimizes driving routes and drives fleet efficiencies. |
✔ | Further strengthened cybersecurity protocols through increased employee training, alignment with industry standards and identifying vulnerabilities working with an external leader in cyber security risk platforms. |
✔ | Entered our 27th year of our RENEW Program in New Jersey, where we invested $10 million in to upgrade more than 24,000 linear feet of water main, as well as service lines, valves and fire hydrants. |
✔ | Earned an Employer Support Award from the American Water Works Association - New Jersey Section for our ongoing commitment to employee development through industry leadership and participation. |
✔ | Interconnected two large water systems serving nearly 20,000 service connections in Sussex County DE, to further stabilize water supply for area residents while increasing distribution system operational efficiency. |
✔ | Further developed our Diversity, Equity and Inclusion strategy through delivery of ongoing training for all employees. |
Middlesex Water Company 26 2023 Proxy Statement 2022 Executive Compensation Analysis and Conclusions In 2015,connection with the market-based analysis of compensation conducted by our independent consultant in the Company’s most recent executive compensation study, the Company established a long-term incentive target as a percentage of base salary. The respective financial and non-financial long- term award target percentages comprising the total award target percentage for each NEO for 2022 were as follows: Name | Base Salary at Grant Date | Target Restricted Stock Award | Financial Target Component | Non-Financial Target Component | Dennis W. Doll | $700,000 | 57% | 80% | 20% | A. Bruce O’Connor | $445,333 | 33% | 60% | 40% | Jay L. Kooper | $345,013 | 25% | 60% | 40% | Georgia M. Simpson | $282,894 | 20% | 60% | 40% | Robert K. Fullagar | $282,652 | 25% | 60% | 40% |
The values of the respective financial and non-financial long-term award targets for each NEO for 2022 performance were as follows: Name | Target Restricted Stock Award ($) | Financial Target Component ($) | Non-Financial Target Component ($) | Dennis W. Doll | 399,000 | 319,200 | 79,800 | A. Bruce O’Connor | 146,960 | 88,176 | 58,784 | Jay L. Kooper | 62,103 | 37, 262 | 24,841 | Georgia M. Simpson | 56,579 | 33,947 | 22,632 | Robert K. Fullagar | 70,663 | 42,398 | 28,265 |
In order for any NEO to be eligible for any amount of long-term incentive award, the Committee, and ultimately the full Board, considers a variety of qualitative factors in their overall assessment of the individual and collective performance of the NEOs. Such factors align with the company’s core values. Elements of such values include, but are not limited to: | • | Legal and regulatory compliance |
| • | Compliance with the Company’s Code of Conduct |
In its further assessment of the extent to which long-term incentive awards would be made relative to performance, the Committee evaluated the performance of each respective NEO, based upon the financial and operational metrics below. The financial target award metric of Income Before Taxes, on which the financial target awards were based, was $44.5 million. This target was established to appropriately incentivize the NEOs and was based on known, anticipated and projected operational and financial opportunities and challenges in 2022. The non-financial target award metrics established for each NEO were as follows: Name | Non-Financial Performance Metrics | Dennis W. Doll | • Further refine and implement succession plan for key roles • Continued implementation of strategic initiatives for long-term growth and sustainability | A. Bruce O’Connor | • Achieve appropriate outcomes in multiple regulatory filings • Further implement strategic operational initiatives in Delaware operations | Jay L. Kooper | • Successfully manage strategic and logistical aspects of multiple regulatory filings • Successfully manage strategic and logistical aspects of multiple legal proceedings | Georgia M. Simpson | • Further implement internal and third party cybersecurity protocols • Lead newly-planned multiple strategic information technology initiatives | Robert K. Fullagar | • Implement further enhancements regarding security/emergency preparedness • Implement enhancements regarding metrics/reporting in Enterprise Risk Management Program |
Company does not have established threshold and maximum award percentages defined relative to each financial and non-financial performance goal. There is no implicit expectation that partial awards would be made relative to the Company financial target, or the non-financial targets, if the target is not fully achieved. The non-financial award targets are partially qualitative in nature. An element of judgment is applied by the Compensation Committee evaluated achievementin assessing the extent to which any individual non-financial target was, or was not achieved. Awards are therefore recommended in the sole judgment and discretion of the corporateCompensation Committee, with the ultimate approval of the full Board. In the Compensation Committee’s evaluation of the extent to which the financial goal for 2014. The Compensation Committee evaluated actual 2014 Income Before Income Taxes and determinedwas achieved, it was concluded that there were no non-recurring items in 2014 that should be considered in the determinationevaluation. The Committee further concluded the Company financial incentive target of the level of achievement of the 2014 corporate financial goal. Based on the Company’s reported 2014 Income Before Income Taxes the Compensation Committee determined that threshold financial performance washad been met in 2014 and awards were made to the NEOs related to the 2014 corporate financial goal. Detailed explanation of the factors contributing to 2014 financial2022 combined with performance are articulated in the Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s 2014 Annual Report to Shareholders. Separately, the Compensation Committee also evaluated the level of achievement of the individual personal performance goals relative to our peer group regarding total shareholder return. In addition, the contributionCommittee assessed the extent to which the various customer-related, strategic, competitive, operationalnon-financial incentive goals were met greater than 100% for each NEO. Consequently, the Committee, and management objectives referenced above.subsequently the full Board, approved the following restricted stock awards: Name | Company Financial Goal ($) | Non-Financial Operational Goal #1 Award ($) | Non-Financial Operational Goal #2 Award ($) | Total Long- Term Incentive Award ($) | Dennis W. Doll | 319,200 | 47,880 | 32,920 | 400,000 | A. Bruce O’Connor | 88,176 | 73,480 | 18,344 | 180,000 | Jay L. Kooper | 37,262 | 11,369 | 11,369 | 60,000 | Georgia M. Simpson | 33,947 | 16,974 | 9,079 | 60,000 | Robert K. Fullagar | 42,398 | 16,561 | 11,041 | 70,000 |
Broad-based Benefits.NEOs are provided with certain health and welfare benefits available to all qualifying employees of the Company, as well as selected fringe benefits and perquisites, not generally available to all employees of the Company. Middlesex Water Company 27 2023 Proxy Statement The following summarizes the broad-based benefits, available to all qualifying employees, in which the NEOs were eligible to participate in 2015:participate: Defined benefit pension plan (see page 24 for description of limitations to participation in this Plan),
Defined contribution 401(k) retirement plan,
Health insurance coverage (all employees share in the cost of such coverage),
Disability insurance coverage.
Group term life insurance coverage (premiums associated with coverage above $50,000 are reported as taxable income to all eligible employees per Internal Revenue Service regulations)
| • | Defined benefit pension plan (see page 31 for description of limitations to participation in this Plan), |
| • | Defined contribution 401(k) retirement plan, |
| • | Health insurance coverage (all employees share in the cost of such coverage), |
| • | Disability insurance coverage, |
| • | Group term life insurance coverage (premiums associated with coverage above $50,000 are reported as taxable income to all eligible employees per Internal Revenue Service regulations). |
Executive Benefits and Perquisites.The NEOs received the following fringe benefits and perquisites in 2015:perquisites: Use of a Company-owned vehicle. The cost of operation and maintenance of such vehicle is borne by the Company. The value of any personal use of such vehicle is reported as taxable income to the executive,
Use of a Company-owned cellular telephone, generally for business purposes,
Group term life insurance coverage of 1.5x base salary (amount in excess of coverage generally available to all employees, for which premiums are reported as taxable income to the executive),
Participation in a Supplemental Executive Retirement Plan (see below for description of limitations to participation in this Plan).
| • | Use of a Company-owned vehicle. The cost of operation and maintenance of such vehicle is borne by the Company. The value of any personal use of such vehicle is reported as taxable income to the executive, |
| • | Use of a Company-owned cellular telephone, generally for business purposes, |
| • | Group term life insurance coverage of 1.5x base salary (amount in excess of coverage generally available to all employees, for which premiums are reported as taxable income to the executive and for which total policy coverage is capped at $1,500,000), |
| • | Participation in a Supplemental Executive Retirement Plan (see below for description of limitations to participation in this Plan). |
The Compensation Committee formally reviews all components of executive compensation on an annual basis, as well as on an interim basis, as deemed necessary. Supplemental Executive Retirement Plan.Certain of the Company’s NEOs are eligible to participate in a non-qualified Supplemental Executive Retirement Plan (SERP) at the discretion of the Board. A participant, who retires on their normal retirement date, as defined in the SERP, is entitled to an annual retirement benefit of up to 75% of eligible compensation, as defined in the SERP, generally reduced by the anticipated primary social security benefit, and further reduced by any benefit payable from the Company’s qualified defined benefit pension plan. Further reductions are made for certain retirement benefits from prior employment, where such benefits have accrued. The maximum annual retirement benefit to which two of the six eligible executives may be entitled is 50% of compensation. Offsetting amounts related to Social Security and other benefit plans are calculated similarly for allparticipating NEOs. Generally, a participant is vested in the SERP at ten (10) years of service in the case of retirement, and in the event of a Change in Control, as described further herein. A participant’s right to receive benefits under the SERP generally commencescommences: 1) upon retirement, 2) to their beneficiary at death andor, 3) in connection with a Change in Control upon termination under the circumstances described in the SERP. Benefits are generally payable upon achieving Normal Retirement, as defined in the SERP, for fifteen (15) years, either to the participant or the participant’s beneficiary. A reduced benefit may be received upon Early Retirement, as defined in the SERP, after age 62 and before age 65. Retirement benefitsThe default method of benefit payment is a 15-year certain payout, payable in monthly installments. Subject to approval by the Compensation Committee, the benefit may also be paid in the form of a single life annuity, joint and 50% survivor’s annuity, joint and 100% survivor’s annuity, single life annuity with a ten (10) year certain period or single life annuity with a fifteen (15) year certain period,period. Amounts paid in any manner other than 15-year certain option are adjusted on an actuarial equivalent basis. Middlesex Water Company 20 2016 Proxy Statement
The Company is not obligated to set aside or earmark any monies or other assets specifically for the purpose of funding the SERP except that upon a Change in Control, the Company would be obligated to make contributions to a trust anticipated to be sufficient to meet the obligations under the SERP. Absent a Change in Control, benefit payments are in the form of an unfunded general obligation of the Company. Exceptions to Usual Procedures.The Compensation Committee may recommend to the full Board that they approve the payment of special cash compensation to one or more NEOs, in addition to payments approved during the annual compensation-setting cycle. The Committee may make such a recommendation if it believes it would beis appropriate to reward one or more NEOs in recognition of contributions to a particular project or initiative, or in response to customer, competitive or other factors that were not addressed during the recurring annual compensation-setting cycle or, that may have changed since the annual compensation-setting cycle. Stock Ownership and Holding Requirements | Named Executive Officer | Stock Ownership and Holding Requirement | Dennis W. Doll | 3.0 X Base Salary | A. Bruce O’Connor | 1.5 X Base Salary | Richard M. Risoldi | 1.5 X Base Salary | Gerard L. Esposito | 1.0 X Base Salary | Bernadette M. Sohler | 1.0 X Base Salary |
The Company establishedhas formal stock ownership and holding requirements for NEOs, in 2012 whereby,to be achieved within five years of being designated a NEO. A formal beneficial Common Stock ownership and holding requirement of 3.0 times base salary has been establishedis required for the CEO, intended to be achieved within five years. As of December 31, 2015, the CEO retains a beneficial stock ownership level in excess of 3.0 times base salary through a combination of personal purchases of stock on the open market and awards of restricted stock under the Company’s incentive compensation program.CEO. A beneficial stock ownership and holding requirement of 1.5 times base salary has been establishedis required for the Chief Financial Officer and Chief Operating Officer. A beneficial stock ownership and holding requirement of 1.0 times base salary has been establishedis required for all other NEOs. A portionSome or all of the shares that are under the beneficial ownership of each NEO ismay be in the form of unvested restricted stock, to which the executive does not acquire unrestricted title until such restricted stock awards fully vest. Employment Agreements.The Company does not have employment agreements with any of the NEOs other than in conjunction with a Change in Control, as detailed elsewhere in this Proxy Statement. All NEOs are “at will” employees. | Compensation Committee Amy B. Mansue, Chair
Steven M. Klein
John R. Middleton, M.D.
Jeffries Shein
|
Amy B. Mansue, Chair Joshua Bershad, M.D. James F. Cosgrove, Jr. Kim C. Hanemann Middlesex Water Company 21 2016 28 2023 Proxy Statement SUMMARY COMPENSATION TABLE The following table details compensation earned or accrued by our NEOs for the three years ended December 31, 2022, 2021 and 2020, respectively. SUMMARY COMPENSATION TABLE | The following table details compensation earned or accrued by our NEOs for the three years ended December 31, 2015, 2014 and 2013, respectively. | Name and Principal Position | Year | (1) Salary ($) | (2) Stock Awards ($) | (3) Change in Pension Value and Non-Qualified Deferred Comp. Earnings ($) | (4) All other Compensation ($) | Total ($) | Dennis W. Doll | 2015 | 485,802 | 271,936 | 86,044 | 47,391 | 891,173 | Chairman, President and | 2014 | 491,855 | 257,692 | 271,641 | 40,742 | 1,061,930 | Chief Executive Officer | 2013 | 461,958 | 191,690 | 0 | 32,701 | 686,349 | | | | | | | | A. Bruce O’Connor | 2015 | 273,979 | 88,788 | 73,669 | 26,850 | 463,286 | Vice President-Treasurer and | 2014 | 277,392 | 84,810 | 299,347 | 26,352 | 687,901 | Chief Financial Officer | 2013 | 260,531 | 70,405 | 0 | 24,254 | 355,190 | | | | | | | | Richard M. Risoldi | 2015 | 273,979 | 88,788 | 100,678 | 28,617 | 492,062 | Vice President-Operations | 2014 | 277,392 | 84,810 | 337,456 | 27,865 | 727,623 | and Chief Operating Officer | 2013 | 260,531 | 63,600 | 0 | 23,654 | 347,784 | | | | | | | | Gerard L. Esposito | 2015 | 189,906 | 28,539 | 141,971 | 20,071 | 380,487 | President | 2014 | 192,272 | 31,503 | 197,334 | 21,853 | 442,963 | Tidewater Utilities, Inc. | 2013 | 180,581 | 26,776 | 0 | 21,853 | 229,210 | | | | | | | | Bernadette M. Sohler | 2015 | 183,592 | 39,660 | 43,279 | 20,246 | 286,777 | Vice President | 2014 | 185,879 | 37,405 | 209,128 | 18,872 | 451,284 | Corporate Affairs | 2013 | 174,577 | 30,994 | 8,796 | 16,046 | 230,413 |
Name and Principal Position | Year | Salary ($) | (1) Stock Awards ($) | (2) Change in Pension Value and Non-Qualified Deferred Comp. Earnings ($) | (3) All other Compensation ($) | Total ($) | Dennis W. Doll Chairman, President and Chief Executive Officer | 2022 | 688,056 | 400,000 | — | 66,670 | 1,154,726 | 2021 | 650,495 | 400,000 | 174 ,119 | 65,830 | 1,290,444 | 2020 | 631,549 | 400,000 | 679,154 | 70,791 | 1,781,494 | A. Bruce O’Connor Sr. Vice President, Treasurer and Chief Financial Officer | 2022 | 435,306 | 180,000 | — | 37,977 | 653,283 | 2021 | 404,890 | 170,000 | 151 ,881 | 36,054 | 762,825 | 2020 | 393,097 | 170,000 | 474,207 | 36,406 | 1,073,710 | Jay L. Kooper Vice President, General Counsel & Secretary | 2022 | 335,066 | 60,000 | — | 37,498 | 432,564 | 2021 | 304,480 | 60,000 | — | 36,325 | 400,805 | 2020 | 294,602 | 60,000 | — | 34,926 | 389,528 | Georgia M. Simpson Vice President Information Technology | 2022 | 270,220 | 60,000 | — | 31,506 | 361 ,726 | 2021 | 233,969 | 60,000 | — | 29,680 | 323,649 | 2020 | 227,155 | 60,000 | — | 29,490 | 316,645 | Robert K. Fullagar Vice President Operations | 2022 | 268,673 | 70,000 | — | 23,663 | 362,336 | 2021 | 228,921 | 70,000 | 64,398 | 17,442 | 380,761 | 2020 | 222,253 | 70,000 | 258,832 | 16,447 | 567,533 |
(1) | The base salary decrease in 2015 reflects 26 pay periods in 2015, as opposed to 27 in 2014. | | |
(2) | Reflects the value of Restricted Stock Plan awards in the applicable year. These awards generally do not vest to the participants until the expiration of five years from the date of such award. During such five-yearfive year period, the participants have contingent ownership of such shares, including the right to vote the same and to receive dividends thereon. | | |
(3)(2) | Represents the aggregate change in the actuarial present value of the accumulated benefitbenefits under all of our defined benefit pension plan.plans for the named executive officers. A zero is shown in those cases where the present value of accumulated benefits declined by $307,616, $124,734 and $203,865 for Mssrs. Doll, O’Connor and Fullagar, respectively. The amountsincreases for this amount in 2020 and 2021 are largelyprimarily due to changes in the levels of qualifying compensation and an additional year of credited service. The increases for 2014 were driven by reductionsNeither an increase or decrease in the discount rate from 4.87% in 2013 to 3.91% in 2014 applied to calculate the benefit and from the adoption of the latest mortality tables (RP-2014) issued by the Society of Actuaries. A zero is shown in those cases where the present value of accumulated benefits declined for 2013 due to the impact of the increase in the discount rate used to value the benefit from 3.99% in 2012 to 4.87% in 2013. The present value of accumulated benefits declined by $32,952, $146,124, $85,123 and $141,498 for Mr. Doll, Mr. O’Connor, Mr. Risoldi and Mr. Esposito, respectively. Neither the increase nor the decrease in pension value resulting from changes in the discount rate results in any increase or decrease in benefits payable to participants under the plans, other than additional creditedcredit service years for the passage of time. Mr. Kooper and Ms. Simpson do not qualify to participate in the Company’s Defined Benefit (DB) Plan since their hire dates were after the DB Plan was closed to new entrants. Alternatively, Mr. Kooper and Ms. Simpson do participate in the Company’s Discretionary Profit Sharing (DPS) Plan administered through the Company’s 401k Plan. See Schedule A - All Other Compensation. The Company does not have any nonqualified deferred compensation plans or related earnings. | | |
(4)(3) | The detail of “All Other Compensation” recognized for the benefit of the NEOs is set forth onin Schedule A as supplemental information to the Summary Compensation Table. |
SCHEDULE - A SUMMARY - ALL OTHER COMPENSATION | The following table details all other compensation earned or accrued for the three years ended December 31, 2015, 2014 and 2013, respectively. | | | Dividends on Restricted Stock | Personal Automobile Use | (5) Group Term Life Insurance Premiums | (5) 401(K) - Employer Match | Spouse Travel | Total - All Other Compensation | Name and Principal Position | Year | ($) | ($) | ($) | ($) | ($) | ($) | Dennis W. Doll | 2015 | 27,114 | 2,724 | 7,263 | 9,274 | 1,016 | 47,391 | Chairman, President and | 2014 | 19,326 | 3,918 | 7,346 | 9,111 | 1,120 | 40,742 | Chief Executive Officer | 2013 | 11,456 | 3,918 | 6,894 | 8,924 | 1,509 | 32,701 | | | | | | | | | A. Bruce O’Connor | 2015 | 11,129 | 2,478 | 3,983 | 8,805 | 455 | 26,850 | Vice President-Treasurer and | 2014 | 9,098 | 3,612 | 4,026 | 8,670 | 1,025 | 26,352 | Chief Financial Officer | 2013 | 6,854 | 3,612 | 3,775 | 8,804 | 1,208 | 24,254 | | | | | | | | | Richard M. Risoldi | 2015 | 10,557 | 4,534 | 3,983 | 8,927 | 616 | 28,617 | Vice President-Operations | 2014 | 8,406 | 6,546 | 4,026 | 7,897 | 1,309 | 27,865 | and Chief Operating Officer | 2013 | 3,195 | 6,195 | 8,960 | 6,288 | - | 24,898 | | | | | | | | | Gerard L. Esposito | 2015 | 4,547 | 4,807 | 3,960 | 6,545 | 212 | 20,071 | President | 2014 | 4,993 | 4,749 | 4,103 | 6,729 | 1,097 | 21,853 | Tidewater Utilities, Inc. | 2013 | 4,088 | 4,749 | 3,895 | 6,320 | 813 | 18,642 | | | | | | | | | Bernadette M. Sohler | 2015 | 4,892 | 5,939 | 2,584 | 5,928 | 903 | 20,246 | Vice President | 2014 | 4,236 | 4,112 | 1,396 | 6,505 | 1,270 | 16,046 | Corporate Affairs | 2013 | 3,209 | 4,112 | 1,308 | 6,110 | 1,041 | 14,691 |
SCHEDULE A - SUMMARY - ALL OTHER COMPENSATION The following table details all other compensation earned or accrued for the three years ended December 31, 2022, 2021 and 2020, respectively. | | Dividends on Restricted Stock | Personal Automobile Use | (4) Group Term Life Insurance Premiums | (4) (5) 401(K) - Employer Match | Spouse Travel | Total - All Other Compensation | Name and Principal Position | Year | ($) | ($) | ($) | ($) | ($) | ($) | Dennis W. Doll Chairman, President and Chief Executive Officer | 2022 | 39,391 | 4,984 | 11,089 | 10,674 | 532 | 66,670 | 2021 | 41,606 | 2,985 | 11,089 | 10,150 | — | 65,830 | 2020 | 46,963 | 2,724 | 11,089 | 9,974 | 41 | 70,791 | A. Bruce O’Connor Sr. Vice President, Treasurer and Chief Financial Officer | 2022 | 14,806 | 3,654 | 8,348 | 10,529 | 640 | 37,977 | 2021 | 14,957 | 2,287 | 8,348 | 10,150 | 312 | 36,054 | 2020 | 15,975 | 2,109 | 8,348 | 9,974 | — | 36,406 | Jay L. Kooper Vice President, General Counsel & Secretary | 2022 | 2,813 | 7,045 | 1,716 | 25,924 | — | 37,498 | 2021 | 1,951 | 8,176 | 1,549 | 24,649 | — | 36,325 | 2020 | 1,025 | 8,176 | 1,501 | 24,224 | — | 34,926 | Georgia M. Simpson Vice President Information Technology | 2022 | 3,030 | 6,551 | 810 | 20,138 | 977 | 31,506 | 2021 | 2,531 | 8,530 | 810 | 17,809 | — | 29,680 | 2020 | 2,135 | 8,530 | 810 | 17,558 | — | 29,490 | Robert K. Fullagar Vice President Operations | 2022 | 3,282 | 7,077 | 3,901 | 9,403 | — | 23,663 | 2021 | 2,665 | 5,007 | 1,758 | 8,012 | — | 17,442 | 2020 | 2,229 | 4,737 | 1,702 | 7,779 | — | 16,447 |
(5)
(4) | The benefits available to the NEOs under these programs are also available to all other employees of the Company. |
(5) | In addition to employer matching contributions under the Company’s 401k Plan, included in this column are contributions from the Company’s DPS Plan administered through the Company’s 401k Plan. Mr. Kooper and Ms. Simpson are the only NEOs eligible to participate in the DPS Plan since each is ineligible to participate in the DB Plan. |
Middlesex Water Company 29 2023 Proxy Statement GRANTS OF PLAN-BASED AWARDS* The following table details information relative to grants of plan-based awards to the NEOs under these programs are also available to all other employees ofour Restricted Stock Plan during the Company.year ended December 31, 2022. Middlesex Water Company 22 2016 Proxy Statement
GRANTS OF PLAN-BASED AWARDS * | The following table details information relative to grants of plan-based awards to the NEOs under our Restricted Stock Plan during the year ended December 31, 2015. | Name | Grant Date | Stock Awards: Number of Shares or Units
(#) | | | (#) | Dennis W. Doll | 7/1/201504/01/2022 | 12,006 3,803 | A. Bruce O’Connor | 7/1/201504/01/2022 | 3,9201,616 | Richard M. RisoldiJay L. Kooper | 7/1/201504/01/2022 | 3,920571 | Gerard L. EspositoGeorgia M. Simpson | 7/1/201504/01/2022 | 1,260571 | Bernadette M. SohlerRobert K. Fullagar | 7/1/201504/01/2022 | 1,751666 |
*The Company does not employ the use of stock options.options STOCK VESTED DURING 2015* | The following table details information regarding the vesting of stock awards as of December 31, 2015. | | Stock Awards | Name | Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | Dennis W. Doll | 452 | 10,740 | A. Bruce O’Connor | 472 | 11,215 | Richard M. Risoldi | 235 | 5,584 | Gerard L. Esposito | 482 | 11,452 | Bernadette M. Sohler | 429 | 10,193 | *The Company does not employ the use of stock options. |
STOCK VESTED DURING 2022* The following table details information regarding the vesting of stock awards as of December 31, 2022. OUTSTANDING EQUITY AWARDS | The following table represents outstanding restricted stock awards as of December 31, 2015. | | Shares of stock that have not vested | Market value of shares of stock that have not vested | Name | (#) | ($) | Dennis W. Doll | 28,994 | 769,501 | A. Bruce O’Connor | 12,482 | 331,272 | Richard M. Risoldi | 11,685 | 310,120 | Gerard L. Esposito | 5,346 | 141,883 | Bernadette M. Sohler | 5,529 | 146,740 |
| Stock Awards | Name | Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | Dennis W. Doll | 8,147 | 856,820 | A. Bruce O’Connor | 2,660 | 279,752 | Jay L. Kooper | — | — | Georgia M. Simpson | 335 | 35,232 | Robert K. Fullagar | 336 | 35,337 |
*The Company does not employ the use of stock options. PENSION BENEFITS | The following table details the present value of accumulated benefits that have accrued under the Qualified Defined Benefit Pension Plan (Qualified Plan) and the SERP as of December 31, 2015. | Name | Plan | Years of Credited Service | Present Value of Accumulated Benefit ($) | Payments During Last Fiscal Year ($) | Dennis W. Doll | MWC Qualified Plan | 11 | 437,598 | — | | MWC SERP | 11 | 1,752,240 | — | A. Bruce O’Connor | MWC Qualified Plan | 26 | 1,079,038 | — | | MWC SERP | 26 | 263,636 | — | Richard M. Risoldi | MWC Qualified Plan | 26 | 1,132,975 | — | | MWC SERP | 26 | 300,712 | — | Gerard L. Esposito | MWC Qualified Plan | 17 | 741,249 | — | | MWC SERP | 17 | 462,221 | — | Bernadette M. Sohler | MWC Qualified Plan | 21 | 595,467 | — | | MWC SERP | 21 | — | — |
OUTSTANDING EQUITY AWARDS The following table represents outstanding unvested restricted stock awards as of December 31, 2022. Name | Shares of stock that have not vested (#) | Market value of shares of stock that have not vested ($) | Dennis W. Doll | 32,246 | 2,536,793 | A. Bruce O’Connor | 12,265 | 964,888 | Jay L. Kooper | 2,519 | 198,170 | Georgia M. Simpson | 2,620 | 206,115 | Robert K. Fullagar | 2,856 | 224,682 |
PENSION BENEFITS The following table details the present value of accumulated benefits that have accrued under the Company’s DB Plan and the SERP as of December 31, 2022. Name | Plan | Years of Credited Service | Present Value of Accumulated Benefit ($) | Payments During Last Fiscal Year ($) | Dennis W. Doll | MWC DB Plan | 18 | 1,006,147 | — | MWC SERP | 18 | 3,666,298 | — | A. Bruce O’Connor | MWC DB Plan | 33 | 1,943,028 | — | MWC SERP | 33 | 1,488,139 | — | Jay L. Kooper (1) | MWC DB Plan | — | — | — | MWC SERP | — | — | — | Georgia M. Simpson (1) | MWC DB Plan | — | — | — | MWC SERP | — | — | — | Robert K. Fullagar (2) | MWC DB Plan | 25 | 785,955 | — | MWC SERP | — | — | — |
| (1) | NEO does not participate in the DB Plan or the SERP. |
| (2) | NEO does not participate in the SERP. |
CEO to Median Employee Pay Ratio We are providing the following information regarding the relationship of the annual total compensation of our Chief Executive Officer (CEO) compared to the annual total compensation of our median employee. For fiscal 2022, our last completed fiscal year: the annual compensation of our CEO, as reported in the Summary Compensation Table included on page 29 of this Proxy Statement, was $1,154,726; the annual total compensation of our median employee was $80,417; and the resulting ratio is 14.36:1. Our pay ratio estimate has been calculated in a manner consistent with Item 402(u) of Regulation S-K using data and assumptions summarized below. To identify our median employee, we first determined our employee population (excluding our CEO) as of the last day of our fiscal year, December 31, 2022 (the Determination Date). We had approximately 350 employees, representing all full-time, part-time, seasonal and temporary workers as of the Determination Date. The number does not include any independent contractors or “leased” workers, as permitted by applicable SEC rules. We then measured our employee population’s total direct compensation in fiscal 2022 for our consistently applied compensation measure based on information from our payroll management systems. This compensation measurement was calculated by totaling, for each employee, their annual W-2 wages, salary, bonuses and perquisites as of the Determination Date and target restricted stock awards granted in fiscal 2022. Once we identified our median employee, we then determined the annual total compensation of this employee. We believe the above is a reasonable estimate of the relationship between the pay of our CEO and the pay of our median employee. Middlesex Water Company 23 2016 30 2023 Proxy Statement All employees hired before April 1, 2007, including all the NEOs except for Mr. Kooper and Ms. Simpson, who were hired after March 31, 2007, and who receive pay for a minimum of 1,000 hours during the calendar year, are participants in the Company’s QualifiedDB Plan. Under the noncontributory QualifiedDB Plan, current service costs are funded annually, as required under Internal Revenue Service guidelines and by the QualifiedDB Plan. The Company’s annual contribution is determined on an actuarial basis. Benefits are measured from the member’s entry date and accrue to normal retirement date or date of early retirement. Benefits are calculated, at normal retirement, at 1.25% of pay up to the employee’s Social Security benefit integration level, plus 1.9% of such excess pay, multiplied by anticipated total years of service to normal retirement date, capped at 35 years of such excess pay, multiplied by years of service achieved and not to exceed number of years of service achieved at normal retirement date of age 65. Average pay is the highest annual average of total pay during any 5 consecutive years within the 10 calendar-year period prior to normal retirement date. The benefit amounts are not subject to any deduction for Social Security benefits or other offset amounts. The benefits under the SERP are described on page 20of28 of this Proxy Statement. All NEOsMessrs. Doll and O’Connor are eligible to receive early retirement benefits under the QualifiedDB Plan, and the SERP only in the event of their retirement. If Messrs. Doll, O’Connor, Risoldi or Ms. Sohlerany of the aforementioned NEOs elected to receive early retirement benefits under the QualifiedDB Plan, such benefits would be at a reduced level on an actuarial basis, as defined under the QualifiedDB Plan for any eligible employee who elects early retirement prior to age 62. If Messrs. Doll, O’Connor, Risoldi, Esposito or Ms. Sohler electedWith respect to the SERP, if participating NEOs, upon achieving age 62 and ten years of service, elect to receive early retirement benefits under the SERP (defined as retirement prior to age 65 but after age 62), such benefits would be at a reduced level as defined under the SERP. Mr. Doll and Mr. O’Connor are eligible to receive early retirement benefits under the SERP, only in the event of their retirement. Mr. Kooper, Ms. Simpson and Mr. Fullagar are not participants in the SERP. No lump sum payment of accumulated retirement benefits is provided under the QualifiedDB Plan or the SERP.
Employees hired after March 31, 2007 are not eligible to participate in the QualifiedDB Plan, but do participate in a defined contribution planDPS Plan, in lieu of the DB Plan, that provides an annual contribution at the discretion of the Company, based upon a percentage of the participants’ compensation. Mr. Kooper and Ms. Simpson are participants in the DPS Plan. POTENTIAL PAYMENTS UPON CHANGE IN CONTROL The Company has Change in Control Agreements with the NEOs. These agreements generally provide that if the executive is terminated by the Company, other than for death, disability, retirement, for Cause (as defined in the agreement), or if the executive resigns for Good Reason (as defined in the agreement) within three (3) years after a Change In Control of the Company, also as defined in the agreement, the executive is entitled to receive, (a) a lump sum severance payment equal to three (3) times the executive’s average annual total eligible compensation, as defined in the agreement, for the five (5) years prior to the termination; (b) continued coverage for three (3) years under any health or welfare plan in which the executive and the executive’s dependents were participating; and (c) an additional amount equal to the amount of federal Excise Tax, if any, that is due or determined to be due resulting from the severance payments or any other payments under the agreement. The Company has no non-Change in Control severance arrangements. The Company does not gross-upgross- up payments for any other federal or state income or other tax under a Change in Control or, under any other agreement or plan. The benefits under any health or welfare benefit plan could end earlier than three (3) years from the date of termination and would end on the earlier of (i) the date the executive becomes covered by a new employer’s health and welfare benefit plan, or (ii) the date the executive becomes eligible for Medicare. Also, coverage for the executive’s dependents could end earlier than any of these dates if required by the health or welfare benefit plan due to age eligibility. In addition to the benefits to be paid to the executive as noted above, if there is a separation from service under the terms of the Change in Control agreement on or before the third anniversary of the Change in Control, the Company shall pay the executive any deferred compensation, including, but not limited to, deferred bonuses allocated or credited to the executive as of the date of termination. Also, any outstanding restricted stock grants awarded to the executive under the Company’s stock plans, which are not vested on termination, shall immediately vest. A Change in Control may also lead to the payment of benefits to the NEOs and other Executive Officers, who participate in the SERP. Under the SERP, if an executive leaves the Company’s employ under the terms of a Change In Control agreement within five years of the Change in Control under any of the following circumstances: (a) the executive’s employment with the Company is terminated by the Company other than for cause; (b) the nature and scope of the executive’s duties or activities with the Company or its successor are reduced to a level significantly below that which the executive had enjoyed immediately prior to the Change in Control; (c) the executive’s base salary is reduced; or (d) if the Change in Control is preceded by the Company terminating the executive’s employment with the Company without cause during the six-month period prior to the occurrence of the Change in Control, the executive shall be entitled to receive an annual retirement benefit equal to 75% of the executive’s Compensation (and in some cases, 50% of Compensation) reduced by certain other benefits as more particularly set forth in the SERP. Such annual retirement benefits shall commence within sixty days after the later of (a) the executive’s Normal Retirement Date, or (b) the executive’s retirement or termination of employment with the Company or its successor. Unless the executive elects and receives approval of an alternative form of payment under the SERP, the executive shall receive the annual retirement benefit each year for fifteen years payable in monthly installments. Notwithstanding the foregoing, if an executive leaves the Company’s employ under the terms of a Change In Control agreement, and within the time frame, and for the reasons discussed above, then, at the executive’s sole option, the executive may elect to receive a reduced benefit equal to 75% of the executive’s eligible Compensation (and in some cases, 50% of Compensation) reduced by certain other benefits as prorated and as set forth in the SERP.SERP, to commence within 60 days of separation of employment. The following table indicates the potential value the NEOs would receive in connection with termination by the Company within three years after a Change in Control of the Company. All scenarios use December 31, 2015,2022, the last business day of the Company’s last completedmost recent fiscal year, as the date for the triggering event set forth in the schedule. Additionally, the potential values to each of the NEOs also include the present value of accumulated benefits under the SERP assuming that each NEO made an election to receive such benefits within sixty days after the executive terminates employment with the Company or its successor. Name | Compensation Paid During Calendar Year 2015 (using definition of “Compensa- tion” under the Agreement) | Termination Before Third Anniversary (1) | Dennis W. Doll | $608,018 | $4,049,568 | A. Bruce O’Connor | $326,481 | $1,806,303 | Richard M. Risoldi | $323,333 | $1,778,729 | Gerard L. Esposito | $213,615 | $1,037,614 | Bernadette M. Sohler | $205,587 | $ 987,238 |
Name | Compensation Paid During Calendar Year 2022 (using definition of “Compensa- tion” under the Agreement) ($) | Termination Before Third Anniversary (1) ($) | Dennis W. Doll | 1,103,675 | 6,868,220 | A. Bruce O’Connor | 619,444 | 2,987,780 | Jay L. Kooper | 412,837 | 1,555,492 | Georgia M. Simpson | 341,710 | 1,256,995 | Robert K. Fullagar | 268,673 | 1,223,489 |
| (1) | Compensation and other benefits paid following termination on or before the third anniversary of the Change in Control. |
Middlesex Water Company 24 2016 31 2023 Proxy Statement
PAY FOR PERFORMANCE COMPARISON As discussed in the CD&A above, our Compensation Committee has implemented an executive compensation program designed to link a substantial portion of our NEO’s realized compensation to the achievement of our strategic financial, operational and strategic objectives, and to align our executive pay with changes in the value of our shareholders’ investments. The following table sets forth additional compensation information for our NEOs, calculated in accordance with SEC regulations, for fiscal years 2022, 2021 and 2020. | | | | | | Average Summary | | Average | | Value of Initial Fixed $100 Investment Based On: | | | | | Year (a) | | Summary Compensation Table Total for CEO (b) | | Compensation Actually Paid to CEO (c) | | Compensation Table Total for non-CEO NEOs (d) | | Compensation Actually Paid to non-CEO NEOs (e) | | Total Shareholder Return (f) | | Peer Group Total Shareholder Return (g) | | Net Income (In Millions) (h) | | Income Before Income Taxes (In Millions) (i) | 2022 | | $ | 1,154,726 | | | $ | 38,867 | | | $ | 452,477 | | | $ | 284,597 | | | $ | 128.86 | | | $ | 120.09 | | | $ | 42.429 | | | $ | 44.400 | | 2021 | | $ | 1,290,444 | | | $ | 3,173,051 | | | $ | 490,567 | | | $ | 782,328 | | | $ | 194.55 | | | $ | 132.92 | | | $ | 36.423 | | | $ | 31.685 | | 2020 | | $ | 1,781,494 | | | $ | 1,714,156 | | | $ | 677,013 | | | $ | 526,936 | | | $ | 115.79 | | | $ | 101.42 | | | $ | 38.305 | | | $ | 28.118 | |
Column (b) Reflects compensation amounts reported in the “Summary Compensation Table” for our CEO, Dennis Doll, for the respective years shown. Column (c) “Compensation actually paid” to our CEO in each of 2022, 2021 and 2020 reflects the respective amounts set forth in column (b) of the compensation table above, adjusted as set forth in the compensation calculation table below, as determined in accordance with SEC rules. The dollar amounts reflected in column (b) of the table above do not reflect the actual amount of compensation earned by or paid to our CEO during the applicable year. For information regarding the decisions made by our Compensation Committee in regards to the CEO’s compensation for each fiscal year, please see the CD&A sections of the proxy statements reporting pay for the fiscal years covered in the table above. The aggregate change in actuarial present value of accumulated benefit under pension plans reflects the amount reported for the applicable year in the Summary Compensation Table. Column (d) Reflects compensation information for our NEOs other than the CEO as described in the CD&A of this proxy statement. 2022: A. Bruce O’Connor, Jay L. Kooper, Robert K. Fullagar, Georgia M. Simpson 2021: A. Bruce O’Connor, Bernadette M. Sohler, Jay L. Kooper, Lorrie B. Ginegaw 2020: A. Bruce O’Connor, Bernadette M. Sohler, Lorrie B. Ginegaw, Jay L. Kooper Column (e) Average “compensation actually paid” for our non-CEO NEOs in each of 2022, 2021 and 2020 reflects the respective amounts set forth in column (d) of the table above, adjusted as set forth in the compensation calculation table below, as determined in accordance with SEC rules. The dollar amounts reflected in column (d) of the table above do not reflect the actual amount of compensation earned by or paid to our non-CEO NEOs during the applicable year. For information regarding the decisions made by our Compensation Committee in regards to the non-CEO NEOs compensation for each fiscal year, please see the CD&A sections of the proxy statements reporting pay for the fiscal years covered in the table above. Column (f) For the relevant fiscal year, represents the cumulative total shareholder return (TSR) of Middlesex for the measurement periods ending on December 31 of each of 2022, 2021 and 2020, respectively. Column (g) For the relevant fiscal year, represents the cumulative TSR of the Peer Group for the measurement periods ending on December 31 of each of 2022, 2021 and 2020, respectively. Peer Group companies currently include American States Water Company, Artesian Resources Corp., California Water Service Group, Global Water Resources Inc., SJW Corp., and York Water Company. Column (h) Reflects Net Income in the Company’s Consolidated Income Statements included in the Company’s Annual Reports on Form 10-K for each of the years ended December 31, 2022, 2021 and 2020. Column (i) Reflects Income Before Income Taxes in the Company’s Consolidated Income Statements included in the Company’s Annual Report on Form 10-K for each of the years ended December 31, 2022, 2021 and 2020. Calculation of Compensation Actually Paid to CEO Year | | Summary Compensation Table Total for CEO | | Summary Compensation Table Equity Awards for CEO | | Equity Awards Adjustment for CEO | | Summary Compensation Table Change in Pension Value for CEO | | Pension Service Cost Adjustment for CEO | | Total Compensation Actually Paid to CEO | 2022 | | $ | 1,154,726 | | | $ | (400,000 | ) | | $ | (1,008,164 | ) | | $ | — | | | $ | 292,314 | | | $ | 38,876 | | 2021 | | $ | 1,290,444 | | | $ | (400,000 | ) | | $ | 2,176,122 | | | $ | (174,119 | ) | | $ | 280,604 | | | $ | 3,173,051 | | 2020 | | $ | 1,781,494 | | | $ | (400,000 | ) | | $ | 758,543 | | | $ | (679,154 | ) | | $ | 253,273 | | | $ | 1,714,156 | |
Fair Value of Equity Awards for CEO | | 2022 | | 2021 | | 2020 | Year End Fair Value of Current Year Equity Award | | $ | 299,182 | | | $ | 608,959 | | | $ | 403,368 | | Year End Change in Fair Value of Prior Year Equity Awards | | $ | (1,184,082 | ) | | $ | 1,507,984 | | | $ | 311,473 | | Change in Fair Value of Prior Year Equity Awards Vesting in Current Year | | $ | (123,264 | ) | | $ | 59,179 | | | $ | 43,702 | | Total Equity Awards Adjustments for CEO | | $ | (1,008,164 | ) | | $ | 2,176,122 | | | $ | 758,543 | |
Middlesex Water Company 32 2023 Proxy Statement PAY FOR PERFORMANCE COMPARISON Cont’d. Calculation of Compensation Actually Paid to non-CEO NEOs Year | | Average Summary Compensation Table Total for non-CEO NEOs | | Average Summary Compensation Table Equity Awards for non-CEO NEOs | | Average Equity Awards Adjustment for non-CEO NEOs | | Average Summary Compensation Table Change in Pension Value for non-CEO NEOs | | Average Pension Service Cost Adjustment for non-CEO NEOs | | Average Total Compensation Actually Paid to non-CEO NEOs | 2022 | | $ | 452,477 | | | $ | (92,500 | ) | | $ | (120,479 | ) | | $ | — | | | $ | 45,098 | | | $ | 284,597 | | 2021 | | $ | 490,567 | | | $ | (88,750 | ) | | $ | 390,457 | | | $ | (78,407 | ) | | $ | 68,461 | | | $ | 782,328 | | 2020 | | $ | 677,013 | | | $ | (88,750 | ) | | $ | 153,174 | | | $ | (273,752 | ) | | $ | 59,252 | | | $ | 526,936 | |
Fair Value of Average Equity Awards for non-CEO NEOs | | 2022 | | 2021 | | 2020 | Year End Fair Value of Current Year Equity Award | | $ | 67,342 | | | $ | 135,097 | | | $ | 100,462 | | Year End Change in Fair Value of Prior Year Equity Awards | | $ | (175,221 | ) | | $ | 246,026 | | | $ | 46,124 | | Change in Fair Value of Prior Year Equity Awards Vesting in Current Year | | $ | (12,600 | ) | | $ | 9,334 | | | $ | 6,588 | | Total Equity Awards Adjustments non-CEO NEOs | | $ | (120,479 | ) | | $ | 390,457 | | | $ | 153,174 | |
Pay for Performance Alignment The Company has identified Income Before Taxes, as referenced in the table at the top of page 32, as the most important financial performance measure. As income taxes are largely a function of taxable income, management has a greater ability to drive financial performance affecting those income statement line items, which are separate and apart from income taxes, than income taxes themselves. Listed below are the financial performance measures, which in our assessment, represent additional important financial performance measures we use to link compensation actually paid to our NEOs, for 2022, to company performance. Return on Average Common Equity Net Income Total Shareholder Return As largely a regulated water and wastewater utility company, achieving returns on average common equity at levels authorized by our economic regulators is an important financial measure. When combined with the financial performance of our non-regulated contract operations business, we achieved a consolidated return on average common equity in 2022 of 11.0%. The net income we derive from our regulated water utility business is somewhat weather-dependent as related to revenue from outdoor irrigation in the spring and summer months. In addition, income we derive from the sale of water to municipal contract customers is dependent on whatever weather and/or other operational anomalies such contract customers may experience from year-to-year. Our ability to manage our water supplies, provide treatment to such supplies in sufficient quantity and quality, combined with our ability to manage and control operation and maintenance expenses, are key drivers of net income and therefore, of our ability to generate net income as an important element of shareholder return. Total Shareholder Return, on an absolute basis and in comparison to that of our peer group, is an important measure of our ability to deliver shareholder value. We view our focus on bottom line financial results combined with common stock dividends as important drivers of total shareholder return. We conclude that the 2022 results related to the three aforementioned important financial measures are relevant to the compensation paid to our CEO and the other NEOs for 2022. Other non-financial measures also used in determining executive compensation for 2022, can be found in the CD&A. Relationship between Pay and Performance Below are graphs showing the relationship of Compensation Actually Paid (CAP) to our CEO and other NEOs in 2020, 2021 and 2022. (1) TSR of both Middlesex and the Peer Group, (2) Middlesex’s net income and (3) Middlesex’s Income Before Income Taxes. CAP, as required under SEC rules, reflects adjusted values to unvested and vested equity awards during the years shown in the table based on year-end stock prices, various accounting valuation assumptions, and projected performance modifiers but does not reflect actual amounts paid out for those awards. CAP generally fluctuates due to stock price achievement and varying levels of projected and actual achievement of performance goals. For a discussion of how our Compensation Committee assessed Middlesex’s performance and our NEOs’ pay each year, see the CD&A in this proxy statement and in the proxy statements for 2021 and 2020. Middlesex Water Company 33 2023 Proxy Statement PROPOSAL 2 NON-BINDING PROPOSAL TO APPROVE THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS
Section 14A of the Exchange Act, as amended by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, or the “Dodd-Frank Act,” enables our shareholders to vote to approve, on an advisory (non-binding) basis, the compensation of our named executive officersNEOs as disclosed in this proxy statement in accordance with the SEC’s rules. As previously disclosed, the Board has determined that it will hold an advisory vote on the compensation of our NEOs on an annual basis. The Compensation of our NEOs is described in the Compensation Discussion and Analysis,CD&A, the compensation tables and the accompanying narrative on pages 17-2423-31 of this Proxy Statement.proxy statement. The Compensation Committee of the Board of Directors is responsible for making recommendations to the full Board of Directors with respect to the compensation of the NEOs, including the Chief Executive Officer.CEO. As part of these duties, the Committee administers the Company’s equity-based incentive compensation plan and conducts an annual performance review of the Chief Executive OfficerCEO and, in consultation with the Chief Executive Officer,CEO, reviews the performance of the other NEOs. The Board of Directors has ultimate authority to determine the compensation of all NEOs, including the Chief Executive Officer.CEO. The overall objectives of the Company’s compensation program are to retain, motivate, and reward employees and officers (including the NEOs) for short- and long-term performance, and to provide competitive compensation to attract appropriate talent to the Company. The methods used to achieve these goals for NEOs are influenced by the compensation and employment practices of our peers and competitors within the utilities industry, and elsewhere in the marketplace, for executive talent. Other considerations include each NEO’s individual performance in achieving both financial and non-financial corporate goals. Based on its review of the total compensation of our NEOs for fiscal year 2015,2022, the Compensation Committee believes that the total compensation for each of the NEOs is reasonable and effectively achieves the objective of aligning compensation with performance measures directly related to our financial goals and creation of shareholder value without encouraging NEOs to take unnecessary or excessive risks. The CD&A section of this Proxy Statementproxy statement and the accompanying tables and narrative provide a comprehensive review of NEO compensation objectives, program and rationale. We urge you to read this disclosure before voting on this proposal, the approval of which is included as Proposal 2 in this Proxy Statement.proxy statement. This advisory vote is typically referred to as a “say-on-pay” vote. For the reasons stated above, the Board is requesting your non-binding approval of the following resolution: “Resolved, that the compensation of NEOs, as disclosed in the Compensation Discussion and Analysis,CD&A, the compensation tables and the accompanying narrative on pages 17-2423-31 of this Proxy Statement, is approved.”proxy statement.
Your vote on this proposal will be non-binding and will not be construed as overruling a decision by the Board. Your vote will not create or imply any change to fiduciary duties or create or imply any additional fiduciary duties for the Board. However, the Board values the opinions that our shareholders express in their votes and will consider the outcome of the vote when making future executive compensation decisions as it deems appropriate. THE BOARD RECOMMENDS THAT SHAREHOLDERS VOTE FOR PROPOSAL 2,
THE NON-BINDING ADVISORY PROPOSAL APPROVING THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS.
THE BOARD RECOMMENDS SHAREHOLDERS VOTE FOR PROPOSAL 2, THE NON-BINDING ADVISORY PROPOSAL APPROVING THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS. |
Middlesex Water Company 25 2016 34 2023 Proxy Statement PROPOSAL 3 PROPOSAL REGARDING THE FREQUENCY (ONE,TWO, OR THREE YEARS) OF THE NON-BINDING SHAREHOLDER VOTE TO APPROVE THE COMPENSATION OFF NAMED EXECUTIVE OFFICERS We believe that a non-binding shareholder vote on executive compensation should occur every year. We believe that a one-year frequency provides the highest level of accountability and communication by enabling the non-binding shareholder vote to approve the compensation of our NEOs to correspond with the most recent executive compensation information presented in our Proxy Statement for our Annual Meeting of Shareholders. We believe that providing a vote only every two or three years may prevent shareholders from communicating in a meaningful and clear manner. For example, we may not know whether the shareholder vote approves or disapproves of compensation for the reporting period or the compensation for previous reporting periods or both. As a result, it could be difficult to discern the implication of the shareholder vote. For the reasons stated above, the Board recommends a vote FOR a one-year frequency for the non-binding shareholder vote to approve the compensation of our NEOs. Note that shareholders are not voting to approve or disapprove the recommendation of the Board with respect to this proposal. Instead, each proxy card provides four choices with respect to this proposal: a one, two or three year frequency or shareholders may abstain from voting on the proposal. Your vote on this proposal will be non-binding on us and the Board and will not be construed as overruling a decision by us or the Board. Your vote will not create or imply any change to our fiduciary duties or create or imply any additional fiduciary duties for us or the Board. However, the Board values the opinions that our shareholders express in their votes and will consider the outcome of the vote when making future compensation decision as it deems appropriate. THE BOARD RECOMMENDS SHAREHOLDERS VOTE FOR A ONE-YEAR FREQUENCY FOR THE NON-BINDING SHAREHOLDER VOTE TO APPROVE THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS. |
Middlesex Water Company 35 2023 Proxy Statement REPORT OF THE AUDIT COMMITTEE The Audit Committee of the Board of Directors is comprised solely of independent Directors.directors. The Committee members for the year 2015 was2022 were Steven M. Klein, Chairman,Chair, Dr. Joshua Bershad, Amy B. Mansue and John R. Middleton, M.D.Vaughn L. McKoy. Mr. Klein serves as Audit Committee Chair and is the designated Audit Committee Financial Expert, as defined by the Securities and Exchange Commission. John C. Cutting, Ph.D. served on the Audit Committee until his retirement from the Board in May 2015. Kim C. Hanemann, named to the Board in January 2016, has been appointed to serve on the Audit Committee for 2016 with fellow Directors Klein, Mansue and Middleton.Commission (“SEC”). The Audit Committee operates under a written Charter adopted by the Board of Directors which is reviewed and adopted annually by the Audit Committee and the Board.Board of Directors. The Charter is available on the Company’s website at www.MiddlesexWater.com. Management is responsible for the Company’s consolidated financial statements and internal controls. The Company’s independent accountants, Baker Tilly Virchow Krause,US, LLP (Baker Tilly)(“Baker Tilly”), are responsible for performing an integrated independent audit of the Company’s annual consolidated financial statements and internal controls over financial reporting in accordance with the standards of the Public Company Accounting Oversight Board (PCAOB) (United States) and for issuing reportsa report thereon. The Audit Committee’s responsibility is to oversee the quality and integrity of the Company’s accounting, auditing and financial reporting practices. In this context, the Audit Committee has metmeets periodically with the independent accountantsBaker Tilly without management present. Each year, the Audit Committee evaluates and considers the qualifications, audit quality, tenure and independence of Baker Tilly. In doing so, the Audit Commit- tee considers the qualifications of Baker Tilly’s engagement team serving the Company, monitors rotation requirements of the Baker Tilly engagement team and interviews engagement team leadership with each rotation. The Committee also discusses with Baker Tilly the most recent PCAOB inspection report for their firm. Baker Tilly has served as the Company’s independent registered public accounting firm since 2006. Management represented to the Audit Committee that the Company’s consolidated financial statements were prepared in accordance with generally accepted accounting principles, and the Audit Committee has reviewed and discussed the consolidated audited financial statements with management and the independent accountants.Baker Tilly. The Audit Committee discussed with the independent accountantsBaker Tilly the matters required to be discussed under the rules adopted by the PCAOB which included as applicable:included: | 1. | Significant issues with regard to Baker Tilly’s appointment or retention; |
| 2. | Significant risks identified during Baker Tilly’s risk assessment procedures; |
| 3. | Significant changes to Baker Tilly’s planned audit strategy or to the significant risks originally identified; |
| 4. | Significant accounting policies and practices and significant unusual transactions; |
| 5. | Critical accounting policies and practices; |
| 6. | Critical accounting estimates; |
| 7. | Baker Tilly’s evaluation of the quality of the Company’s financial reporting; |
| 8. | Other information in documents containing audited financial statements; |
| 9. | Difficult or contentious matters for which Baker Tilly was consulted; |
| 10. | Management’s consultations with other accountants; |
| 11. | Going concern considerations; |
| 12. | Uncorrected and corrected misstatements; |
| 13. | Material written communications between the Company and Baker Tilly; |
| 14. | Significant difficulties encountered in performing the audit. |
Baker Tilly also discussed with regard to the independent accountant’s appointment or retention; Significant risks identified during the independent accountant’s risk assessment procedures;Significant changes to the independent accountant’s planned audit strategy or to the significant risks originally identified;Significant accounting policies and practices and significant unusual transactions;Critical accounting policies and practices;Critical accounting estimates;The independent accountant’sAudit Committee their evaluation of critical audit matters under the quality of the entity’s financial reporting;Other information in documents containing audited financial statements;Difficult or contentious matters for which the
independent accountant was consulted;Management’s consultations with other accountants;Going concern consideration;Uncorrected and corrected misstatements;Material written communications between the CompanyPCAOB auditor reporting model, and the independent accountant; andSignificant difficulties encountered in performing the audit.
The independent accountantsrelated effect on their auditor report. Baker Tilly also provided to the Audit Committee the written disclosures required by the applicable rules of the PCAOB, and the Audit Committee discussed with the independent accountantsBaker Tilly the firm’s independence with respect to Middlesex Water Company and its management. The Audit Committee has the sole authority to pre-approve permitted non-audit services performed by the independent accountantsBaker Tilly and has considered whether the independent accountants’ provision ofany such non-audit services, provided to the Companycompany, is compatible with maintaining their independence.
Based on the Audit Committee’s discussions with management and the independent accountants,Baker Tilly, the Audit Committee’s review of the audited financial statements, the representations of management regarding the audited financial statements and the report of the independent accountantsBaker Tilly to the Audit Committee, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015,2022, for filing with the SEC.SEC. The Audit Committee also discussed with management the process used for the establishment and maintenance of disclosure controls and procedures in quarterly and annual reports which is required by the SEC and the Sarbanes-Oxley Act of 2002, for certain of the Company’s filings with the SEC. | Audit Committee | | | | Steven M. Klein, Chairman
Kim C. Hanemann
Dr. Joshua Bershad | | Amy B. Mansue
John R. Middleton, M.D. Vaughn L. McKoy |
Middlesex Water Company 26 2016 36 2023 Proxy Statement PROPOSAL 4 PROPOSAL 3
RATIFICATION OF APPOINTMENT BY THE AUDIT COMMITTEE OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM The shares represented by the proxies will be voted for ratification of the appointment by the Audit Committee of Baker Tilly Virchow Krause,US, LLP (Baker Tilly) as our independent registered public accounting firm, to issue a report to the Board and shareholders on our financial statements for the fiscal year ending December 31, 2016.2023. Although submission of the appointment of an independent registered public accounting firm to shareholders for ratification is not required by law or regulation, the Board is submitting the selection of an independent registered public accounting firm for shareholder ratification. Under the Sarbanes-Oxley Act of 2002 and the rules of the SEC promulgated thereunder, theThe Audit Committee is solely responsible for the appointment, compensation and oversight of the work of our independent registered public accounting firm. Representatives of Baker Tilly are expected to be present at the Annual Meeting and will be afforded an opportunity to make a statement, if they so desire, and to respond to appropriate questions. The affirmative vote of a majority of the votes cast by shareholders in person or represented by proxy, at the Annual Meeting is required for the approval of this Proposal. The Board has not determined what action it would take if the shareholders do not approve the selection of Baker Tilly, but may reconsider the selection if the shareholders’ action so warrants. Even if the selection is ratified, the Audit Committee, exercising its own discretion, may select different auditors at any time during the year if it determines that such a change would be in the Company’s best interests and in the best interests of shareholders. THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR PROPOSAL 3,
THE RATIFICATION OF THE APPOINTMENT OF BAKER TILLY VIRCHOW KRAUSE, LLPshareholders
THE BOARD RECOMMENDS SHAREHOLDERS VOTE FOR PROPOSAL 4, THE RATIFICATION OF THE APPOINTMENT OF BAKER TILLY US, LLP. |
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FEES Baker Tilly was previously approved and appointed by the Audit Committee as the Company’s independent registered public accounting firm for the years ended December 31, 20152022 and 2014.2021. Aggregate fees billed to the Company for the years ended December 31, 20152022 and 20142021 by Baker Tilly are as follows: | 2015 | 2014 | Audit Fees {a} | $385,754 | $382,571 | Audit-Related Fees | – | – | Total Audit and Audit-Related Fees | 385,754 | 382,571 | Tax Fees {b} | 25,618 | 23,500 | All Other Fees | – | – | Total Fees | $411,372 | $406,071 |
| 2022 ($) | 2021 ($) | Audit Fees {a} | 480,239 | 432,150 | Audit-Related Fees | — | — | Total Audit and Audit-Related Fees | 480,239 | 432,150 | Tax Fees {b} | 33,500 | 31,000 | All Other Fees | — | — | Total Fees | 513,239 | 463,150 |
| | | | {a} | Audit fees were incurred for auditsan audit of the financial statements and internal control over financial reporting of the Company, an auditaudits of the financial statements of a subsidiary of the Company, and reviews of the financial statements included in the Company’s quarterly reports on Form 10-Q and services provided in connection with2022 related to the Company’s July 2015sale of a subsidiary and a Form S-3 Registration Statement on Form S-3. | | filing. |
| {b} | Tax fees were incurred for the preparation of the Company’s tax returns. |
The Audit Committee has established pre-approval policies and proceduresan approval policy for all recurring audit services and non-auditall other permitted services to be performed by Baker Tilly. TheRecur- ring audit services include annual audits of the Company’s financial statements and internal control over financial reporting, tax return preparation, and reviews of the Company’s Quarterly Reports on Form 10-Q. Recurring audit services require the pre-approval of the Audit Committee. All other permitted services with fees less than $50,000, individually and in the aggregate, are subject to the pre-approval of the Audit Committee approves 100% ofChair, with subsequent ratification by the services related to Audit Fees, Audit-Related Fees, Tax Fees and All Other Fees in excess of $5,000.Committee. Middlesex Water Company 27 2016 37 2023 Proxy Statement SECURITY OWNERSHIP AND OTHER MATTERS
SECURITY OWNERSHIP OF DIRECTORS, MANAGEMENT AND CERTAIN BENEFICIAL OWNERS The following table sets forth as of March 28, 2016,27, 2023, the number of shares of Middlesex Water common stock beneficially owned by the elected Directors, Executive Officers named in the table appearing under Executive Compensation, and all elected Directors and Executive Officers as a group. All Directors own stock in Middlesex Water Company. Jeffries Shein owned 2.04% of the shares outstanding as of March 28, 2016. All other individual elected Directors and Executive Officers owned less than 3.46%1.86% of the shares outstanding on March 28, 2016.27, 2023. Name | Total Shares Beneficially Owned (1) | Directors | | Joshua Bershad, M.D. | 131 ,169 | James F. Cosgrove, Jr. Cosgrove, Jr. | 4,7798,518 | Kim C. Hanemann | 1002,251 | Steven M. Klein | 4,3267,892 | Amy B. Mansue | 5,5009,066 | John R. Middleton, M.D.Vaughn L. McKoy | 13,516500 | Ann L. Noble | 1,997 | Walter G. Reinhard | 9,1187,151 | Jeffries Shein | 331,421 | Named Executive Officers | | Named Executive Officers | | Dennis W. Doll | 73,53388,725 | A. Bruce O’ConnorO'Connor | 47,79931 ,298 | Richard M. RisoldiJay L. Kooper | 32,4722,519 | Gerard L. EspositoGeorgia M. Simpson | 20,8352,980 | Bernadette M. SohlerRobert K. Fullagar | 9,5043,593 | All elected Directors and Executive Officers as a group including those named above. (14(16 people) | 559,958* 329,454* |
(1) | Beneficial owner has the sole power to vote such shares. | | |
| * | Represents 3.45%1.86% of the shares outstanding on March 28, 2016.27, 2023. Percentage of each individual is based on 16,240,167 shares outstanding as of March 28, 2016.27, 2023. |
Section 16(A) Beneficial Ownership Reporting Compliance Under Section 16 of the Securities Exchange Act of 1934, Officers and Directors, and certain beneficial owners of the Company’s equity securities are required to file reports of ownership and changes in ownership with the SEC on specified due dates. Based solely on a review of the copies of these reports furnished to us, we believe that all filing requirements applicable to such Officers and Directors (we are not aware of any five percent holder) were met during 2015.2022. Other Security Holders The following table sets forth as of March 28, 2016,27, 2023, certain information with respect to the beneficial ownership of shares of Common Stock by each person or group we know to beneficially own more than five percent of the outstanding shares of such stock. Name and Address of Beneficial Owners | Number of Shares | Percent of Class | BlackRock Institutional Trust CompanyInc. | 2,569,008 (1) | 14.6% | 55 East 52nd Street | | | 400 Howard StreetNew York, NY 10055 | | | San Francisco, CA 94105State Street Corporation | 1,033,847 (1)1,867,863 (2) | 6.37%10.59% | One Lincoln Street | | | Boston, MA 02111 | | | The Vanguard Group | 1,424,068 (3) | 8.07% | 100 Vanguard Boulevard | | | Malvern, PA 19355 | | |
| (1) | This information is based on a Schedule 13F13G Combined filed with the SEC on December 31, 2015 by BlackRock Fund Advisors.January 26, 2023. |
(2) | This information is based on a Schedule 13G Combined filed with the SEC on February 10, 2023. |
(3) | This information is based on a Schedule 13G Combined filed with the SEC on February 9, 2023. |
OTHER MATTERS The Board does not intend to bring any other matters before the Annual Meeting and has no reason to believe any will be presented for consideration at the Annual Meeting. If, however, other matters properly do come before the Annual Meeting, it is the intention of the persons named in the accompanying proxy to vote in their discretion on such matters. Electronic Access to Proxy Materials and Annual Reports Our Proxy Statementproxy statement and Annual Report are available on the Investor Relations section of our website at www.MiddlesexWater.com and the following website www.proxyvote.com. Paper copies of these documents may be requested by contacting our Corporate Secretary in writing at the Office of the Corporate Secretary, Middlesex Water Company, 1500 Ronson Road, P.O. Box 1500,485C Route 1 South, Suite 400, Iselin, New Jersey 08830-0452. 08830. The Company is subject to the informational requirements of the Securities Exchange Act of 1934 and files an Annual Report on Form 10-K with the Securities and Exchange Commission. Additional copies of the 20152022 Annual Report on Form 10-K filed by the Company, including the financial statementsstatement and schedules, but without exhibits, can be mailed without charge to any shareholders. The exhibits are obtainable from the Companycompany upon payment of the reasonable cost of copying such exhibits. Minutes of 20152022 Annual Meeting of Shareholders The minutes of the 20152022 Annual Meeting of Shareholders will be submitted at the Annual Meeting for the correction of any errors or omissions but not for the approval of the matters referred to therein. Middlesex Water Company 28 2016 38 2023 Proxy Statement
1500 Ronson Road
Iselin, New Jersey 08830-0452
732-634-1500
MiddlesexWater.com
FROM GARDEN STATE PARKWAY (NORTH OR SOUTH):
Take Exit 131 to fourth traffic light. Turn right onto Middlesex-Essex Turnpike and proceed (about 1/2 mile) to third traffic light (Gill Lane). Turn right and go (about 1 mile) under railroad underpass and make right onto Ronson Road. Proceed past three large mirror-sided office buildings on the right. At the sign, make a right into Middlesex Water Company.
FROM NEW JERSEY TURNPIKE (NORTH OR SOUTH):
Take Exit 11 onto the Garden State Parkway North and follow above directions.
FROM US ROUTE NO. 1 (NORTH OR SOUTH):
Proceed to the Woodbridge Center area and follow signs to Gill Lane. When on Gill Lane, make aThis page is intentionally left turn onto Ronson Road and follow above directions.blank.
Middlesex Water Company 39 2023 Proxy Statement
485C ROUTE 1 SOUTH SUITE 400 ISELIN, NJ 08830 Investor Address Line 1 Investor Address Line 2 Investor Address Line 3 Investor Address Line 4 Investor Address Line 5 John Sample 1234 ANYWHERE STREET ANY CITY, ON A1A 1A1 2345678 1234567 2345678 1234567 2345678 1234567 234567 SCAN TO VIEW MATERIALS & VOTE VOTE BY INTERNET - www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. During The Meeting - Go to www.virtualshareholdermeeting.com/MSEX2023 You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. NAME THE COMPANY NAME INC. - COMMON CONTROL # ? SHARES 123,456,789,012.12345 THE COMPANY NAME INC. - CLASS A 123,456,789,012.12345 THE COMPANY NAME INC. - CLASS B 123,456,789,012.12345 THE COMPANY NAME INC. - CLASS C 123,456,789,012.12345 THE COMPANY NAME INC. - CLASS D 123,456,789,012.12345 THE COMPANY NAME INC. - CLASS E 123,456,789,012.12345 THE COMPANY NAME INC. - CLASS F 123,456,789,012.12345 THE COMPANY NAME INC. - 401 K 123,456,789,012.12345 x TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: PAGE 1 OF 2 KEEP THIS PORTION FOR YOUR RECORDS THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY The Board of Directors recommends you vote FOR the following: For Withhold For All All All Except To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. 1. Election of Directors Nominees 0 0 0 01) Joshua Bershad, M.D. 02) James F. Cosgrove, Jr. 03) Vaughn L. McKoy The Board of Directors recommends you vote FOR the following proposal: For Against Abstain 2. To provide a non-binding advisory vote to approve named executive officer compensation. The Board of Directors recommends you 0 0 0 NOTE: We may also transact such other business that may properly come before the meeting or any postponement or adjournment thereof. vote 1 YEAR on the following proposal: 1 year 2 years 3 years Abstain 3. To provide a non-binding advisory vote to approve the frequency of the vote to approve the compensation of our named executive officers. 0 0 0 0 The Board of Directors recommends you vote FOR the following proposal: For Against Abstain 4. To ratify the appointment of Baker Tilly US, LLP as the Company's independent registered public accounting firm for the fiscal year ending December 31, 2023. 0 0 0 Investor Address Line 1 Investor Address Line 2 Investor Address Line 3 Investor Address Line 4 Investor Address Line 5 Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer. JOB # John Sample 1234 ANYWHERE STREET ANY CITY, ON A1A 1A1 SHARES CUSIP # SEQUENCE # Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com MIDDLESEX WATER COMPANY Annual Meeting of Shareholders May 23, 2023 This proxy is solicited by the Board of Directors The shareholder(s) hereby appoint(s) Kim C. Hanemann and Ann L. Noble, or either of them, as proxies, each with the power to appoint his/ her substitute, and hereby authorize(s) them to represent and to vote, as designated on the reverse side of this ballot, all of the shares of Common Stock of Middlesex Water Company that the shareholder(s) is/are entitled to vote at the Annual Meeting of Shareholders, to be held virtually at www.virtualshareholdermeeting.com/MSEX2023 at 11:00 a.m., on May 23, 2023, and any adjournment or postponement thereof. THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED BY THE SHAREHOLDER(S). IF NO SUCH DIRECTIONS ARE MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE NOMINEES LISTED ON THE REVERSE SIDE FOR THE BOARD OF DIRECTORS; FOR THE APPROVAL, BY NON-BINDING VOTE, OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS; FOR THE APPROVAL, BY NON-BINDING VOTE, OF THE FREQUENCY OF THE VOTE TO APPROVE EXECUTIVE COMPENSATION AND FOR RATIFICATION OF THE APPOINTMENT BY THE AUDIT COMMITTEE OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM. Continued and to be signed on reverse side 0000066004 3 2022-01-01 2022-12-31 |