Description of UGI Corporation Senior Executive Employee Severance Pay Plan, Amended July 25, 2006
Exhibit 10.1
Description of UGI Corporation Senior Executive Employee
Severance Pay Plan, Amended July 25, 2006
On July 25, 2006, the Board of Directors of UGI Corporation (the “Company”) approved an amendment to the UGI Corporation Senior Executive Employee Severance Pay Plan (as amended, the “UGI Severance Plan”). The amended UGI Severance Plan became effective July 25, 2006 and is applicable to the Company’s named executive officers employed by the Company.
The UGI Severance Plan assists certain senior level employees of the Company, including Lon R. Greenberg, Anthony J. Mendicino and John L. Walsh, in the event their employment is terminated without fault on their part. François Varagne is not entitled to severance benefits under the UGI Severance Plan. Specified benefits are payable to a senior executive covered by the UGI Severance Plan if the senior executive’s employment is involuntarily terminated for any reason other than for cause or as a result of the senior executive’s death or disability.
The UGI Severance Plan provides for cash payments equal to a participant’s compensation, as defined in the UGI Severance Plan, for 6 months (12 months in the case of Mr. Walsh and 18 months in the case of Mr. Greenberg). In addition, a participant receives the cash equivalent of his or her target bonus under the Company’s Annual Bonus Plan, pro-rated for the number of months served in the fiscal year. However, if the termination occurs in the last two months of the fiscal year, the Chief Executive Officer has the discretion to determine whether the participant will receive a pro-rated target bonus, or the actual annual bonus which would have been paid after the end of the fiscal year, assuming that the participant’s entire bonus was contingent on meeting the applicable financial performance goal. The UGI Severance Plan also provides for separation pay equal to one day’s pay per month of service, with a minimum payment equal to 3 months’ compensation and a maximum payment equal to 12 months’ compensation, in each case as defined in the UGI Severance Plan.
Certain employee benefits, including medical and dental benefits, are continued under the UGI Severance Plan for a period not to exceed 18 months (24 months in the case of Mr. Walsh and 30 months in the case of Mr. Greenberg). The UGI Severance Plan also provides for outplacement services for a period of 12 months following an executive’s termination of employment. Executives will be entitled to receive tax preparation services for their final year of employment under the UGI Severance Plan. The Company has the option to pay a participant the cash equivalent of those employee benefits. Provided that the participant is eligible to retire, all payments under the UGI Severance Plan can be reduced by an amount equal to the fair market value of certain equity-based awards, other than stock options, payable to the participant after the termination of employment.
In order to receive benefits under the UGI Severance Plan, a senior executive is required to execute a release which discharges the Company and its affiliates from liability for any claims the senior executive may have against any of them, other than claims for amounts or benefits due to the executive under any plan, program or contract provided by or entered into with the Company or its affiliates. The senior executive is also required to ratify post-employment activities agreements and to cooperate in attending to matters pending at the time of his or her termination of employment.
