UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant ☒ Filed by a Party other than the Registrant ☐
Check the appropriate box:
☐ | Preliminary Proxy Statement |
☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
☒ | Definitive Proxy Statement |
☐ | Definitive Additional Materials |
☐ | Soliciting Material Pursuant to §240.14a-12 |
Murphy USA Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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☐ | Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. |
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(4) | Date Filed: |
MURPHY USA Notice of 2019 Annual Meeting of Stockholders and Proxy Statement Your Vote is Important
R. Madison Murphy Chairman of the Board of Directors |
March 19, 2019
Dear Stockholder:
The Board of Directors and management cordially invite you to attend Murphy USAs Annual Meeting of Stockholders to be held at 8:00 a.m., Central Time, on Wednesday, May 1, 2019, at the South Arkansas Arts Center, 110 East 5th Street, El Dorado, Arkansas 71730. The formal notice of the Annual Meeting of Stockholders and Proxy Statement follow.
Whether or not you attend the Annual Meeting, it is important that your shares are represented and voted at the meeting. Therefore, we urge you to vote promptly and submit your proxy via the internet, by phone, or by signing, dating, and returning the enclosed proxy card. If you attend the Annual Meeting, you can vote in person, even if you have previously submitted your proxy.
On behalf of the Board of Directors, we would like to express our appreciation for your investment in Murphy USA. We look forward to greeting you.
Sincerely,
Murphy USA Inc. | 200 Peach St. | El Dorado, AR 71730 | 870-875-7600 | corporate.murphyusa.com | NYSE: MUSA
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
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Notice of Annual Meeting
Wednesday, May 1, 2019 8:00 a.m. Central Time |
South Arkansas Arts Center 110 East 5th Street, El Dorado, Arkansas 71730
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Record Date The close of business March 4, 2019 |
The Annual Meeting of Stockholders of Murphy USA Inc. (the Company) will be held at the South Arkansas Arts Center, 110 East 5th Street, El Dorado, Arkansas 71730, on Wednesday, May 1, 2019, at 8:00 a.m., Central Time, for the following purposes:
1. | Election of three Class III directors whose current terms expire on the date of the 2019 Annual Meeting; |
2. | Approval of executive compensation on an advisory, non-binding basis; |
3. | Ratification of the action of the Audit Committee of the Board of Directors in appointing KPMG LLP as the Companys independent registered public accounting firm for fiscal 2019; and |
4. | Such other business as may properly come before the meeting. |
Only stockholders of record at the close of business on March 4, 2019, the record date fixed by the Board of Directors of the Company, will be entitled to notice of and to vote at the meeting. A list of all stockholders entitled to vote is on file at the office of the Company, 200 Peach Street, El Dorado, Arkansas 71730.
Cast Your Vote Right Away
It is very important that you vote. Please cast your vote right away on all of the proposals listed above to ensure that your shares are represented. For specific instructions on how to vote your shares, please refer to the instructions on the Notice of Internet Availability of Proxy Materials (Notice) you received in the mail or, if you requested to receive printed proxy materials, on your enclosed proxy card.
Notice and Access
Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be held on May 1, 2019:
The Notice of 2019 Annual Meeting, 2019 Proxy Statement and 2018 Annual Report on Form 10-K are available, free of charge, at www.proxyvote.com.
This year, we will be furnishing proxy materials over the internet to a number of our stockholders under the U.S. Securities and Exchange Commissions notice and access rules. Many of our stockholders will receive the Notice in the mail instead of a paper copy of this Proxy Statement, a proxy card or voting instruction card and our 2018 Annual Report. We believe that this process will reduce the environmental impact of our Annual Meeting as well as reduce the costs of printing and distributing our proxy materials. The Notice will instruct you as to how you may access and review all of the proxy materials on the internet.
All stockholders who do not receive the Notice will receive a paper copy of the proxy materials by mail, unless they have previously elected to receive proxy materials by email. We remind stockholders who receive the Notice that the Notice is not itself a proxy card and should not be returned with voting instructions. The Notice only presents an overview of the more complete proxy materials. Stockholders should review the proxy materials before voting.
The Notice contains instructions on how to access our proxy materials and vote over the internet at www.proxyvote.com and how stockholders can receive a paper copy of our proxy materials, including this Proxy Statement, a proxy card or voting instruction card and our 2018 Annual Report. At www.proxyvote.com, stockholders can also request to receive future proxy materials in printed form by mail or electronically by email.
By the Order of the Board of Directors
Gregory L. Smith
Secretary
El Dorado, Arkansas
March 19, 2019
MURPHY USA INC. 1
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
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2 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
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Table of Contents (continued)
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Electronic Availability of Proxy Materials for 2019 Annual Meeting |
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This Proxy Statement is issued by Murphy USA Inc. in connection with the 2019 Annual Meeting of Stockholders scheduled for May 1, 2019. This Proxy Statement and accompanying proxy card are first being made available to stockholders on or about March 19, 2019.
MURPHY USA INC. 3
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
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Proposal 1 Election of Three Class III Directors Whose Current Terms Expire on the Date of the Annual Meeting (continued)
The following Class III directors are nominated for re-election at this Annual Meeting of Stockholders.
R. Madison Murphy
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Chairman of the Murphy USA Board of Directors since August 2013; Director of Murphy Oil Corporation (Murphy Oil) since 1993 and serves on its Executive Committee and as Chair of its Audit Committee; Chairman of the Board of Murphy Oil from 1994 to 2004 and Chief Financial Officer of Murphy Oil from 1992 to 1994; Managing Member, Murphy Family Management, LLC (manages investments, farm, timber and real estate) since 1998; Director of Deltic Timber Corporation (a NYSE natural resources and timberland company) from 1996 until its merger with Potlatch Corporation in February 2018
Qualifications: Mr. Murphy served as Chairman of the Board of Murphy Oil from 1994 to 2004. This background, along with his current membership on the Board of Directors of Murphy Oil and his past membership on the Board of Directors of BancorpSouth, Inc. (a NYSE bank holding company) and Deltic Timber Corporation, brings to the Board invaluable corporate leadership and financial expertise.
Board Committees: Executive Committee (Chair) and ex-officio of all Committees
Age: 61
Director since: August 2013 | |
R. Andrew Clyde
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President and Chief Executive Officer of Murphy USA since August 2013; Partner (global energy practice), Booz & Company (and prior to August 2008, Booz Allen Hamilton) (a global management and strategy consulting firm) from 2000 to 2013, where he held leadership roles as North American Energy Practice Leader and Dallas office Managing Partner and served on the firms board Nominating Committee
Qualifications: Mr. Clydes leadership over Murphy USAs successful value creation strategy and his previous consulting experience working with downstream energy and retail clients on corporate and business unit strategy, organization, and performance improvement, make him a valuable member of our Board.
Board Committees: Executive Committee
Age: 55
Director since: August 2013 | |
David B. Miller
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Co-Founder and Managing Partner of EnCap Investments L.P., a leading provider of private equity capital to the oil and gas industry since 1988; President of PMC Reserve Acquisition Company, a partnership jointly owned by EnCap and Pitts Energy Group, from 1988 to 1996; Co-Chief Executive Officer and Co-Founder of MAZE Exploration Inc., a Denver-based oil and gas company, from 1981 to 1988; Director of Halcon Resources Corporation (an independent NYSE energy company) from 2012 to 2016
Qualifications: Mr. Millers broad energy industry knowledge and his leadership experience and expertise in business valuation, capital structure and strategic relationships complement the collective strength and leadership of our Board.
Board Committees: Executive Compensation Committee and Nominating and Governance Committee
Age: 69
Director since: January 2016 |
6 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
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Proposal 1 Election of Three Class III Directors Whose Current Terms Expire on the Date of the Annual Meeting (continued)
The following Class I and Class II directors are not up for re-election at this Annual Meeting of Stockholders. Class I directors will be up for election at our Annual Meeting in 2020 and Class II directors will be up for election at our Annual Meeting in 2021.
Class I Directors (terms expiring at the 2020 Annual Meeting)
Claiborne P. Deming
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Chairman of the Board of Murphy Oil since March 2012, also Chairman of its Executive Committee; President and Chief Executive Officer of Murphy Oil from October, 1994 through December, 2008
Qualifications: Mr. Demings previous experience as President and Chief Executive Officer of Murphy Oil gives him insight into the Companys challenges, opportunities and operations. Among other qualifications, Mr. Deming brings to the Board executive leadership skills and over 30 years experience in the oil and gas industry.
Board Committees: Executive Compensation Committee (Chair) and Executive Committee
Age: 64
Director since: August 2013 | |
Thomas M. Gattle, Jr.
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Chairman of the Board, President and Chief Executive Officer of TerralRiver Service, Inc. (a private company operating fertilizer terminals, boats and barges) since 1992; Director of American Plant Food (a private manufacturer of fertilizers); owned and operated several businesses including Terral Barge Line, which operated the Lake Providence and Madison Ports on the Mississippi River from 1980-1992 and Great River Grain from 1980-1990, which owned and operated grain elevators on the lower Mississippi River
Qualifications: Mr. Gattles many years of experience as a successful company owner and executive officer allow him to provide significant input to our Board on both financial and operational matters.
Board Committees: Audit Committee and Nominating and Governance Committee
Age: 67
Director since: August 2013 | |
Jack T. Taylor
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Director of Genesis Energy LP since 2013 (a NYSE midstream energy master limited partnership) and serves as a member of the Audit and the Governance, Compensation and Business Development Committees; Director of Sempra Energy (a NYSE Fortune 500 energy services company) since February 2013 and serves as a member of the Executive, Audit and Compensation Committees; Chief Operating Officer-Americas and Executive Vice Chair of U.S. Operations for KPMG LLP from 2005 to 2010
Qualifications: Mr. Taylor has extensive experience with financial and public accounting issues as well as a deep knowledge of the energy industry. He spent over 35 years as a public accountant at KPMG LLP, serving in a leadership capacity during many of those years. He is a National Association of Corporate Directors Board Leadership Fellow and a member of the NACDs Audit Committee Chair Advisory Council. This experience with financial and public accounting issues, together with his executive experience and knowledge of the energy industry, make him a key contributor to our Board.
Board Committees: Audit Committee (Chair)
Age: 67
Director since: August 2013 |
MURPHY USA INC. 7
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
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Proposal 1 Election of Three Class III Directors Whose Current Terms Expire on the Date of the Annual Meeting (continued)
Hon. Jeanne L. Phillips
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Senior Vice President, Corporate Engagement & International Relations of Hunt Consolidated, Inc. where she has been employed since 2004; U.S. Permanent Representative to the Organization for Economic Cooperation and Development (OECD) with rank of ambassador in Paris from 2001 to 2003
Qualifications: Ambassador Phillips significant experience in government affairs, corporate leadership and crisis communications in the energy industry provide her with a broad base of knowledge, and her service and experience involving many varied entities at the state, national and international levels provide her with additional insights, all of which make her a strong asset to our Board.
Board Committees: Audit Committee and Nominating and Governance Committee
Age: 65
Director since: November 2018 |
Class II Directors (terms expiring at the 2021 Annual Meeting)
Fred L. Holliger
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Chairman and CEO of Giant Industries (a NYSE petroleum refining and retail convenience store company) from 2002 to 2007; Independent consultant to Western Refining Company (a NYSE crude oil refiner and marketer) from 2007 through June 2012
Qualifications: Mr. Holliger spent his entire 36-year career in the petroleum industry in a variety of engineering, marketing, supply and general management positions. His long career in the oil and gas industry along with his leadership experience allows him to provide numerous insights to our Board.
Board Committees: Executive Compensation Committee and Nominating and Governance Committee
Age: 71
Director since: August 2013 | |
James W. Keyes
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Chairman of Wild Oats LLC, since January 2012; Chief Executive Officer of Fresh & Easy, LLC from November 2012 to October 2015, which filed for reorganization under Chapter 11 of the US Bankruptcy Code in October 2015; Chairman and Chief Executive Officer of Blockbuster (a provider of home movie and video game rental services) from 2007 to 2011, which filed for reorganization under Chapter 11 of the US Bankruptcy Code in September 2010; Chief Executive Officer of 7-Eleven Inc. from 2000 to 2005
Qualifications: Mr. Keyes experience running large companies, and specifically 7-Eleven Inc. (a major retail gasoline chain), along with his leadership on the successful sale of Blockbusters assets to Dish Networks through its restructuring process, provides invaluable business and industry expertise to our Board.
Board Committees: Executive Committee and Executive Compensation Committee
Age: 64
Director since: August 2013 | |
Diane N. Landen
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Owner and President of Vantage Communications, Inc. (private company in investment management, communications and broadcast property ownership) since 1990; Chairman and Executive Vice President of Noalmark Broadcasting Corporation (a private radio and media company) since 2012; Partner at Munoco Company L.C. (a private oil and gas exploration and production company) since 2012; Secretary and Director of Loutre Land and Timber Company (a private natural resources company) since 1998, and serves on its Executive and Nominating Committees
Qualifications: Ms. Landen has over 20 years experience in investment management, communications and broadcast property ownership. She has, through her involvement in these many and varied business ventures, developed a broad range of experience in operating successful companies, allowing her to make significant contributions to our Board.
Board Committees: Nominating and Governance Committee (Chair) and Audit Committee
Age: 58
Director since: August 2013 |
THE BOARD RECOMMENDS A VOTE FOR THE CLASS III DIRECTORS NOMINATED BY THE BOARD.
8 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
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Board and Governance Matters (continued)
10 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
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Board and Governance Matters (continued)
Further information regarding non-employee director compensation is set forth in the following table.
2018 Non-Employee Director Compensation Table
Name | Fees Earned or Paid in Cash(1) ($) |
Stock Awards(2) ($) |
All Other Compensation(3) ($) |
Total ($) | ||||||||||||||||
R. Madison Murphy |
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218,500 |
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93,717 |
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25,000 |
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337,217 |
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Claiborne P. Deming |
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96,500 |
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93,717 |
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9,430 |
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199,647 |
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Thomas M. Gattle, Jr. |
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83,500 |
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93,717 |
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177,217 |
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Fred L. Holliger |
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87,500 |
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93,717 |
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181,217 |
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James W. Keyes |
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89,500 |
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93,717 |
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183,217 |
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Diane N. Landen |
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96,250 |
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93,717 |
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20,000 |
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209,967 |
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David B. Miller |
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79,500 |
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93,717 |
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173,217 |
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Hon. Jeanne L. Phillips(4) |
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6,178 |
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9,131 |
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15,309 |
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Jack T. Taylor |
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101,000 |
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93,717 |
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194,717 |
(1) | The amounts shown reflect the cash retainers and meeting fees paid during the fiscal year ended December 31, 2018. |
(2) | The amounts shown reflect the aggregate grant date fair value, as computed in accordance with FASB ASC Topic 718 regarding stock compensation, for restricted stock unit awards granted to the non-employee directors in 2018. The aggregate number of unvested restricted stock units held as of December 31, 2018 by Hon. Jeanne L. Phillips was 121 and 5,112 for each other non-employee director. |
(3) | The amounts shown represent contributions made on behalf of Mr. Murphy, Mr. Deming, and Mrs. Landen to charitable organizations under our gift matching program. |
(4) | Hon. Jeanne L. Phillips was elected to the Board on November 19, 2018. |
MURPHY USA INC. 11
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
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Board and Governance Matters (continued)
12 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
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Ownership of Murphy USA Common Stock
Security Ownership Of Certain Beneficial Owners
The following are known to the Company to be the beneficial owners of more than five percent of the Companys common stock (as of the most recent date of such stockholders Schedule 13G filing for Murphy USA with the SEC):
Name and address of beneficial owner |
Amount and nature of beneficial ownership(1) |
Percentage | ||||||||
BlackRock, Inc. 40 East 52nd Street New York, NY 10022(2)
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10.8 |
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The Vanguard Group. 100 Vanguard Blvd. Malvern, PA 19355(3) |
2,841,857 | 8.8 | % |
(1) | Includes common stock for which the indicated owner has sole or shared voting or investment power and is based on the indicated owners Schedule 13G filing for Murphy USA for the period ended December 31, 2018. |
(2) | A parent holding company or control person of the entities holding Murphy USA shares in accordance with Rule 13d-1(b)(1)(ii)(G). Total includes 3,395,390 shares with sole voting power, 0 shares with shared voting power, 3,484,084 shares with sole dispositive power and 0 shares with shared dispositive power. |
(3) | An investment adviser in accordance with Rule 13d-1(b)(1)(ii)(E). Total includes 35,922 shares with sole voting power, 4,885 shares with shared voting power, 2,804,351 shares with sole dispositive power and 37,506 shares with shared dispositive power. |
Security Ownership of Directors and Management
The following table sets forth information, as of the record date, concerning the number of shares of Common Stock of the Company beneficially owned by all directors and nominees, each of the Named Executive Officers (as listed in the first table of the Compensation Discussion and Analysis section of this Proxy) and directors and executive officers as a group.
Name |
Personal with Full Voting and Investment Power(1)(2) |
Personal as Beneficiary of Trusts |
Voting and Investment Power Only |
Options Exercisable Within 60 Days |
Total | Percent of Outstanding (if greater than one percent) |
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Claiborne P. Deming |
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262,396 |
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394,844 |
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52,430 |
(3) |
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709,670 |
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2.21% |
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Thomas M. Gattle, Jr. |
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12,685 |
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12,685 |
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(4) |
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Fred L. Holliger |
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10,076 |
(5) |
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10,076 |
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(4) |
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James W. Keyes |
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13,076 |
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13,076 |
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(4) |
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Diane N. Landen |
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59,762 |
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76,837 |
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8,991 |
(6) |
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145,590 |
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(4) |
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David B. Miller |
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37,288 |
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37,288 |
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(4) |
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R. Madison Murphy |
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558,934 |
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229,598 |
(7) |
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788,532 |
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2.45% |
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Hon. Jeanne L. Phillips |
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(4) |
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Jack T. Taylor |
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14,076 |
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14,076 |
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(4) |
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R. Andrew Clyde |
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119,406 |
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108,550 |
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227,956 |
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(4) |
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Mindy K. West |
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67,857 |
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30,050 |
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97,907 |
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(4) |
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John A. Moore |
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26,375 |
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13,250 |
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39,625 |
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(4) |
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Terry P. Hatten |
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(4) |
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Robert J. Chumley |
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3,350 |
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3,350 |
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(4) |
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Daryl R. Schofield |
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(4) |
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Directors and executive officers as a group (17 persons) |
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612,921 |
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1,040,691 |
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291,019 |
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155,200 |
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2,099,831 |
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6.52% |
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(1) | Includes Murphy USA Savings 401(k) Plan shares in the following amounts: Mr. Clyde 1,500 qualified shares; Ms. West 601 qualified shares; Mr. Moore 1,458 qualified shares. Excludes non-transferrable, non-voting shares of common stock held in trust under the Murphy USA Supplemental Executive Retirement Plan in the following amounts: Mr. Clyde 12,148 shares. |
(2) | Includes shares of common stock held by spouse and other household members as follows: Mr. Deming 12,110 shares held by spouse; Mr. Gattle 100 shares owned jointly with spouse; Ms. Landen 2,043 shares owned jointly with spouse and children. |
(3) | Includes 52,430 shares of common stock held in trust for children. |
(4) | Less than 1%. |
(5) | Includes 10,076 shares of common stock held by trust for which Mr. Holliger and his spouse are the beneficiaries and trustees. |
(6) | Includes 8,991 shares of common stock held by trusts for which Ms. Landen is the trustee. |
(7) | Includes (i) 96,050 shares of common stock held by a private foundation of which Mr. Murphy is President for which beneficial ownership is expressly disclaimed, (ii) 36,918 shares of common stock held in trust for children in which Mr. Murphy is Trustee, (iii) 41,379 shares of common stock held in trust for children in which spouse is Trustee, (iv) 47,365 shares owned by the 2011 Murphy Family Trust, beneficial ownership expressly disclaimed, (v) includes 7,886 shares owned by The Suzanne and Madison Murphy Grandchildrens Trust, beneficial ownership expressly disclaimed. |
MURPHY USA INC. 13
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Ownership of Murphy USA Common Stock (continued)
Section 16(a) Beneficial Ownership Reporting Compliance
Based on a review of the copies of reports filed by the Companys directors and executive officers pursuant to Section 16(a) of the Securities Exchange Act of 1934, and on representations from the reporting persons, the Company believes that each reporting person has complied with all applicable filing requirements during fiscal 2018.
14 MURPHY USA INC.
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Compensation Discussion and Analysis (continued)
2018 Business Highlights
We measure our operating performance relative to the execution of a proven strategy that reflects five coherent themes that leverage our differentiated strengths and capabilities. This 5-Point Strategy supports a business model which is both enduring in a highly volatile industry and hard to replicate by competitors. Our strategy creates a unique way to compete for customers, workforce talent, supplier-partner support and stockholder capital. We take none of these stakeholders for granted and our goal is to create sustained value for all of them while making a positive impact in the communities we serve. Highlighted accomplishments among the 5-Point Strategy for 2018 include:
Grow Organically
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Grew Portfolio to 1,472 Stores
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Added 26 new stores, increasing the total network size to 1,472 stores
Completed 27 raze and rebuild sites
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Diversify Merchandise Mix
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Expanded Merchandise Unit Margins to Record 16.5%
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Improved merchandise unit margins to a record-high 16.5% for the year, compared to 16.1% in 2016
Grew merchandise sales by 2.1%
Expanded non-tobacco merchandise dollars by 6.3%
Grew tobacco margin dollars by 4.1%
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Sustain Cost Leadership Position
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Maintained Per Store Operating Costs
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Beat inflation on per site operating expenses (before payment fees) by maintaining costs at a 1.1% increase compared to 2017 on an average per store month (APSM) basis
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Create Advantage from Market Volatility
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Generated $686M in Total Fuel Contribution
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Generated $686 million, or 16.2 cents per retail gallon, of total fuel contribution
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Invest for the Long-Term
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Repurchased $144M in Shares
|
Returned capital to stockholders by completing nearly $1bn share repurchase program since spin ($144M in 2018)
|
MURPHY USA INC. 17
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Compensation Discussion and Analysis (continued)
Return to Stockholders
The Company has delivered consistent returns to our stockholders over the past three years. Following the completion of a $250 million share repurchase program in 2015, we announced an additional $500 million share repurchase program in January 2016, which was completed in 2018. Our three-year annualized total shareholder return (TSR) for the period ending December 31, 2018 of over 6% outpaced the median TSR of our peer group (discussed in the Role of Market Data section included on page 19 in this Proxy Statement).
Annualized Total Shareholder Return
Reported and Realized Pay
Since a majority of reported pay for our Chief Executive Officer represents potential pay, we also consider pay actually realized each year. The following graph shows reported pay included in the 2018 Summary Compensation Table on page 27 as compared to realized pay during 2018.
Reported and Realized Compensation for the CEO
(Amounts in $ millions)
The realized pay data shown above include the value of options exercised and restricted stock unit (RSU) and PSU awards which vested (earned in the case of the PSUs) during the applicable year. Note that for Mr. Clyde, no options were exercised in 2016 or 2017.
In 2018, Mr. Clyde exercised options totaling nearly $7.7 million as a result of Murphy USAs stock price more than doubling since the spin off. Of that amount, roughly $5.4 million was related to options issued by Murphy Oil prior to the spin off which were inherited by Murphy USA. Prior to their exercise, Mr. Clyde held the options for roughly five years of the seven-year term. In addition, PSUs were earned at 165.0% of target for the 2016-2018 performance period. When combined with stock price appreciation since grant ($80.00 vs. $59.11), the value of PSUs increased significantly, supporting our pay for performance philosophy.
In May 2014, stockholders approved an annual frequency for Say-on-Pay votes. The Committee carefully considered the results of our Say-on-Pay vote on NEO compensation in May 2018, in which 97.5% of the advisory votes cast were in support of the Companys Say-on-Pay
18 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Compensation Discussion and Analysis (continued)
proposal and executive compensation programs for our NEOs as described in our 2018 Proxy Statement. The Committee interpreted this level of support as affirmation by our stockholders of the design and overall execution of our executive compensation programs.
Throughout the past year, the Company engaged in dialogue with our largest stockholders about various corporate governance topics, including executive compensation. The Company values these discussions and encourages our stockholders to provide feedback about our executive compensation programs.
Based on the results of the 2018 vote and our ongoing dialogue with our stockholders, as well as a consideration of evolving best practices, the Committee continues to examine our compensation programs to ensure alignment with stockholder interests remains strong.
Compensation Design Principals and Governance Practices
The Committee intends for its compensation design principles to protect and promote our stockholders interests. We believe our compensation programs are consistent with best practices for sound corporate governance.
MURPHY USA INC. 19
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Compensation Discussion and Analysis (continued)
Our compensation program is comprised of three key components, each designed to be market-competitive and to help attract, motivate, retain and reward our NEOs.
Element |
Key Characteristics | Objectives | ||
Base Salary |
Fixed minimum level of compensation |
Reward the executive for day-to-day execution of primary duties and responsibilities | ||
Reviewed annually and adjusted if and when appropriate |
Provide a foundation level of compensation upon which incentive opportunities can be added to provide the motivation to deliver superior performance
| |||
Annual Incentives |
Variable cash compensation component |
Motivate and reward NEOs for achieving annual business goals | ||
Performance-based award opportunity based on annual operational and individual performance
|
Align executives interests with the interests of stockholders Encourage responsible risk taking and individual accountability | |||
Long-term Incentives |
Variable equity-based compensation component |
Align executives interests with the interests of stockholders | ||
Performance-based award opportunity based on long-term performance |
Reinforce the critical objective of building stockholder value over the long term
Focus management attention upon the execution of the long-term business strategy |
The majority of our NEO compensation is performance-based and is issued in the form of both short- and long-term incentives. Individuals in a position to influence the growth of stockholder value have larger portions of their total compensation delivered in the form of equity-based long-term incentives. The target mix of the elements of the compensation program for the CEO and other NEOs is shown in the following chart which outlines the size, in percentage terms, of each element of target compensation.
Target Compensation Mix
20 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Compensation Discussion and Analysis (continued)
Name |
Title | 2017 Salary ($) |
2018 Salary ($) | |||||||||
R. Andrew Clyde |
President & CEO |
|
1,030,000 |
|
1,060,000 |
|||||||
Mindy K. West |
EVP Fuels, CFO & Treasurer |
|
567,000 |
|
580,000 |
|||||||
John A. Moore |
SVP & General Counsel |
|
413,000 |
|
420,000 |
|||||||
Terry P. Hatten(1) |
SVP, Human Resources |
|
|
|
420,000 |
|||||||
Rob J. Chumley |
SVP, Marketing |
|
365,000 |
|
385,000 |
|||||||
Daryl R. Schofield(1) |
Former EVP, Fuels |
|
510,000 |
|
525,000 |
(1) | The 2018 salaries for Messrs. Hatten who joined the Company in June 2018 and Schofield whose employment with the Company ended on July 2, 2018 reflect annualized base salary rates. Actual salaries received are included in the Summary Compensation Table on page 27. |
Name |
Title | Target Bonus as a % of Salary | |||||
R. Andrew Clyde |
President & CEO |
|
115 |
||||
Mindy K. West |
EVP Fuels, CFO & Treasurer |
|
75 |
||||
John A. Moore |
SVP & General Counsel |
|
60 |
||||
Terry P. Hatten |
SVP, Human Resources |
|
60 |
||||
Rob J. Chumley |
SVP, Marketing |
|
65 |
||||
Daryl R. Schofield(1) |
Former EVP, Fuels |
|
85 |
(1) | Mr. Schofields employment with the company ended in July 2018; pursuant to his separation agreement, Mr. Schofield was not eligible for an AIP payment related to 2018 performance. |
2018 Corporate Performance
MURPHY USA INC. 21
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Compensation Discussion and Analysis (continued)
Metric | Weighting (%) |
Threshold (50% Payout) |
Target (100% Payout) |
Maximum (200% Payout) |
Actual | Payout % of Target (%) |
Weighted Performance Score (%) |
|||||||||||||||||||||
ROACE (%)(1) |
|
40 |
|
|
9.0 |
|
|
12.5 |
|
|
15.0 |
|
|
12.8 |
|
|
112.0 |
|
|
44.8 |
| |||||||
Fuel Cash Breakeven (cents per gallon)(2) |
40 | 1.25 | 1.00 | 0.75 | 0.82 | 172.0 | 68.8 | |||||||||||||||||||||
Corporate Goals(3) |
|
20 |
|
|
See Details in Note 3 |
|
|
120.0 |
|
|
24.0 |
| ||||||||||||||||
Total |
|
100 |
|
|
137.6 |
|
(1) | ROACE is computed by dividing the Companys earnings before interest and taxes, as adjusted from time to time for certain unusual and nonrecurring gains or losses, by the sum of (a) the average of the Companys beginning and ending balance of property, plant and equipment during the respective year and (b) the average of the Companys beginning and ending net working capital position during the respective year. |
(2) | Fuel Cash Breakeven is computed by dividing merchandise gross margin dollars, less total site operating costs and retail administrative costs, by total retail gallons of fuel sold. |
(3) | 20% of the AIP payout is determined based on the Companys performance relative to the 2018 Corporate Goals. The five Corporate Goals chosen for 2018 were assessed and approved by the Committee. The Corporate Goals were designed to drive our 5-Point Strategy described on page 17. Performance against the Corporate Goals is determined based on a scorecard where each of the five goals, weighted equally, can receive four points for Target performance, and up to eight points for Maximum performance. If all of the Corporate Goals are achieved at Maximum performance, the total score for the Corporate Goals would be 40 points, or 200% of target. In cases where performance is deemed not acceptable, it will be scored below Threshold and points may be deducted from the total weighted performance score. |
The Target level goals (shown below) can be characterized as strong performance, meaning that based on historical performance, although attainment of this performance level is uncertain, it can be reasonably anticipated that Target performance may be achieved, while the Threshold goals are more likely to be achieved and the Maximum goals represent more aggressive levels of performance. The Committee reviewed performance against the Corporate Goals and determined that actual performance resulted in achievement of 120.0% of the Target in aggregate. Actual results achieved versus each of the Corporate Goals is illustrated below:
Actual |
||||||||||||||||||||||||||||
Corporate Goals | Weighting (%) |
Target (100% Payout) |
Below Threshold |
Threshold (0% Payout) |
Target (100% Payout) |
Maximum (200% Payout) |
Weighted Performance Score % |
|||||||||||||||||||||
Organic Growth: New Site Growth Number of new sites opened for operation (including raze and rebuilds)
|
4 | 50 to 52 | ✓ | |||||||||||||||||||||||||
Organic Growth: Retail Fuel Volume Growth Thousands of gallons (APSM) for all stores in full month of operation
|
4 | 240 to 245 | ✓ | |||||||||||||||||||||||||
Diversify Merchandise Mix: Merchandise Gross Margin Thousands of dollars APSM gross margin for all stores in full month of operation
|
4 | 22.75 to 23.25 | ✓ | |||||||||||||||||||||||||
Sustain Cost Leadership Position: Site Operating Expense Cost Management Thousands of dollars APSM for site operating costs (excluding credit card fees)
|
4 | 20.2 to 20.6 | ✓ | |||||||||||||||||||||||||
Create Advantage from Market Volatility: Fuel, PS&W & RINs Contribution Total cpg on retail equivalent volume basis
|
4 | 15.25 to 16.25 | ✓ | |||||||||||||||||||||||||
Total |
|
20.0 |
|
|
24.0 |
|
22 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Compensation Discussion and Analysis (continued)
C. Long-Term Incentive Compensation
We provide share-based, long-term compensation to our executive officers through our stockholder-approved Murphy USA Inc. 2013 Long-Term Incentive Plan, as amended and restated effective as of February 9, 2017 (the LTIP). Long-term incentive levels for Murphy USAs officers are targeted at the median of competitive market pay levels. The plan provides for a variety of stock and share-based awards, including stock options and RSUs, each of which vests over a period determined by the Committee, as well as PSUs that are earned based on the Companys achievement of two equally-weighted objective performance goals. We believe that these awards create a powerful link between the creation of stockholder value and executive pay delivered. In addition, we believe that the balance between absolute and relative performance achieved through the use of stock options, ROACE-based PSUs and relative TSR-based PSUs is appropriate. In order for executives to fully realize their targeted opportunities, Murphy USA must both successfully achieve its long-term goals and outperform its peers.
Stock Options |
Restricted Stock Units | Performance Stock Units | ||||
Weighting |
25% |
25% |
50% | |||
Objectives |
Provide a direct link between executive officer compensation and the value delivered to stockholders Inherently performance-based, as option holders only realize benefits if the value of our stock increases following the grant date |
Drive behaviors to create value for stockholders by linking executive compensation to stock price performance Encourage retention Result in actual share ownership (thereby supporting the Companys stock ownership guidelines)
|
Align executives interests with the interests of stockholders Reinforce the critical objective of building stockholder value over the long term Focus management attention upon the execution of the long-term business strategy | |||
Performance Conditions |
N/A |
N/A |
50% ROACE 50% TSR relative to our peer group
| |||
Term |
Seven years |
Three years |
Three years | |||
Vesting |
Vest in two equal installments on the second and third anniversaries of the grant date
|
Cliff vest on the third anniversary of the grant date |
Cliff vest after three years upon certification of results | |||
Payout |
Upon exercise, participant acquires net common shares at the previously defined exercise price |
Participant acquires unrestricted shares of common stock upon vesting |
Payment made in unrestricted shares of common stock at the end of three years upon approval of performance results by the Committee Payouts at 50% of target for threshold level of performance Maximum payouts capped at 200% of target
|
MURPHY USA INC. 23
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Compensation Discussion and Analysis (continued)
Metric |
Weighting (%) |
Threshold (50% Payout) |
Target (100% Payout) |
Maximum (200% Payout) |
Actual | Payout % of Target (%) |
Weighted Performance Score (%) | ||||||||||||||||||||||||||||
ROACE (%) |
|
50 |
|
9.0 |
|
12.0 |
|
15.0 |
|
12.9 |
|
130.0 |
|
65.0 |
|||||||||||||||||||||
Relative TSR (Percentile Rank) |
|
50 |
|
<25 |
th |
|
50 |
th |
|
75 |
th |
|
84.6 |
|
200.0 |
|
100.0 |
||||||||||||||||||
Total |
|
100 |
|
165.0 |
% |
24 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Compensation Discussion and Analysis (continued)
MURPHY USA INC. 25
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Compensation Discussion and Analysis (continued)
26 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Further information with respect to the compensation paid to the NEOs is set forth in the following tables:
2018 Summary Compensation Table
Name and Principal Position | Year | Salary ($) |
Bonus ($) |
Stock Awards(1) ($) |
Option Awards(2) ($) |
Non-Equity Incentive Plan Compensation(3) ($) |
Change in Pension Value and Nonqualified Deferred Compensation Earnings(4) ($) |
All Other Compensation(5) ($) |
Total ($) |
|||||||||||||||||||||||||||
R. Andrew Clyde President & Chief Executive Officer
|
2018 | 1,057,500 | | 2,100,840 | 665,088 | 1,677,344 | | 437,399 | 5,938,171 | |||||||||||||||||||||||||||
2017 | 1,027,500 | | 2,746,022 | 800,310 | 864,479 | | 339,597 | 5,777,908 | ||||||||||||||||||||||||||||
|
2016
|
|
|
991,667
|
|
|
|
|
|
2,665,370
|
|
|
770,232
|
|
|
1,364,000
|
|
|
|
|
|
403,929
|
|
|
6,195,198
|
| ||||||||||
Mindy K. West Executive Vice President, Fuels, Chief Financial Officer & Treasurer
|
2018 | 578,917 | 25,000 | (6) | 574,000 | 181,860 | 598,560 | | 123,110 | 2,081,447 | ||||||||||||||||||||||||||
2017 | 565,583 | | 757,134 | 220,935 | 323,655 | 295,006 | 110,968 | 2,273,281 | ||||||||||||||||||||||||||||
2016 | 546,083 | | 734,234 | 212,256 | 507,858 | 34,618 | 116,395 | 2,151,444 | ||||||||||||||||||||||||||||
John A. Moore |
2018 | 419,417 | | 275,520 | 88,332 | 346,752 | | 108,633 | 1,238,654 | |||||||||||||||||||||||||||
Senior Vice President & |
2017 | 413,000 | | 372,917 | 106,605 | 189,071 | 150,432 | 78,920 | 1,310,945 | |||||||||||||||||||||||||||
General Counsel
|
|
2016
|
|
|
412,250
|
|
|
|
|
|
422,436
|
|
|
122,208
|
|
|
307,272
|
|
|
19,033
|
|
|
84,722
|
|
|
1,367,921
|
| |||||||||
Terry P. Hatten(7) Senior Vice President, Human Resources
|
2018 | 233,760 | | 218,400 | 69,280 | 192,992 | | 23,418 | 737,850 | |||||||||||||||||||||||||||
Robert J. Chumley Senior Vice President, Marketing
|
2018 | 383,333 | | 275,520 | 88,332 | 344,344 | | 55,639 | 1,147,168 | |||||||||||||||||||||||||||
Daryl R. Schofield(8) Former Executive Vice President, Fuels
|
2018 | 263,522 | | 585,480 | 187,056 | | | 877,402 | 1,913,460 | |||||||||||||||||||||||||||
2017 | 336,159 | 100,000 | 1,186,273 | | 218,016 | | 167,406 | 2,007,854 | ||||||||||||||||||||||||||||
MURPHY USA INC. 27
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Executive Compensation (continued)
(5) | We offer limited perquisites to our NEOs which, together with Company contributions to our qualified savings and nonqualified defined contribution plans, comprise the All Other Compensation column. In 2018, the total amounts were as follows: |
Name |
Total Contribution to DC Plans(a) ($) |
Term Life(b) ($) |
Other(c) ($) | ||||||||||||
R. Andrew Clyde |
|
230,855 |
|
594 |
|
205,950 |
|||||||||
Mindy K. West |
|
109,876 |
|
594 |
|
12,640 |
|||||||||
John A. Moore |
|
89,989 |
|
594 |
|
18,050 |
|||||||||
Terry P. Hatten |
|
12,600 |
|
149 |
|
10,669 |
|||||||||
Robert J. Chumley |
|
55,045 |
|
594 |
|
|
|||||||||
Daryl R. Schofield |
|
34,575 |
|
322 |
|
842,505 |
(6) | Reflects payment of a special bonus awarded to Ms. West in recognition of her expanded role as Executive Vice President, Fuels, Chief Financial Officer, and Treasurer. |
(7) | Mr. Hatten joined the Company in June 2018; his compensation for 2018 reflects his partial year of employment. Mr. Hatten received prorated long-term incentive awards in connection with his June 2018 hiring. |
(8) | Mr. Schofield separated from the Company on July 2, 2018. All unvested equity awards held by Mr. Schofield at the time of his separation were forfeited, including the remaining portion of his make whole award (8,953 RSUs) and all annual equity awards. |
Grants of Plan-Based Awards in 2018
The following table provides information regarding both equity and non-equity incentive plan awards granted to each NEO during 2018. All awards are described in more detail in the Compensation Discussion and Analysis section beginning on page 16 in this Proxy Statement.
Name |
Grant Date |
Estimated Future Payouts Under |
Estimated Future Payouts Equity |
All Other Stock Awards: Number of Shares of Stock or Units(3) (#) |
All Other Option Awards: Number of Securities Underlying Options (#) |
Exercise or Base Price of Option or Stock Awards ($/Sh) |
Grant Date Fair Value of Stock and Option Awards(4) ($) |
|||||||||||||||||||||||||||||||||||||
Threshold ($) |
Target ($) |
Maximum ($) |
Threshold (#) |
Target (#) |
Maximum (#) |
|||||||||||||||||||||||||||||||||||||||
R. Andrew Clyde |
609,500 | 1,219,000 | 2,438,000 | |||||||||||||||||||||||||||||||||||||||||
02/07/18 | 9,150 | 18,300 | 36,600 | 1,451,190 | ||||||||||||||||||||||||||||||||||||||||
02/07/18 | 9,150 | 649,650 | ||||||||||||||||||||||||||||||||||||||||||
02/07/18 | 38,400 | 71.00 | 665,088 | |||||||||||||||||||||||||||||||||||||||||
Mindy K. West |
217,500 | 435,000 | 870,000 | |||||||||||||||||||||||||||||||||||||||||
02/07/18 | 2,500 | 5,000 | 10,000 | 396,500 | ||||||||||||||||||||||||||||||||||||||||
02/07/18 | 2,500 | 177,500 | ||||||||||||||||||||||||||||||||||||||||||
02/07/18 | 10,500 | 71.00 | 181,860 | |||||||||||||||||||||||||||||||||||||||||
John A. Moore |
126,000 | 252,000 | 504,000 | |||||||||||||||||||||||||||||||||||||||||
02/07/18 | 1,200 | 2,400 | 4,800 | 190,320 | ||||||||||||||||||||||||||||||||||||||||
02/07/18 | 1,200 | 85,200 | ||||||||||||||||||||||||||||||||||||||||||
02/07/18 | 5,100 | 71.00 | 88,332 | |||||||||||||||||||||||||||||||||||||||||
Terry P. Hatten(5) |
70,113 | 140,226 | 280,452 | |||||||||||||||||||||||||||||||||||||||||
06/12/18 | 1,000 | 2,000 | 4,000 | 145,600 | ||||||||||||||||||||||||||||||||||||||||
06/12/18 | 1,000 | 72,800 | ||||||||||||||||||||||||||||||||||||||||||
06/12/18 | 4,000 | 72.80 | 69,280 | |||||||||||||||||||||||||||||||||||||||||
Robert J. Chumley |
125,125 | 250,250 | 500,500 | |||||||||||||||||||||||||||||||||||||||||
02/07/18 | 1,200 | 2,400 | 4,800 | 190,320 | ||||||||||||||||||||||||||||||||||||||||
02/07/18 | 1,200 | 85,200 | ||||||||||||||||||||||||||||||||||||||||||
02/07/18 | 5,100 | 71.00 | 88,332 | |||||||||||||||||||||||||||||||||||||||||
Daryl R. Schofield(6) |
223,125 | 446,250 | 892,500 | |||||||||||||||||||||||||||||||||||||||||
02/07/18 | 2,550 | 5,100 | 10,200 | 404,430 | ||||||||||||||||||||||||||||||||||||||||
02/07/18 | 2,550 | 181,050 | ||||||||||||||||||||||||||||||||||||||||||
02/07/18 | 10,800 | 71.00 | 187,056 |
28 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Executive Compensation (continued)
MURPHY USA INC. 29
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Executive Compensation (continued)
Outstanding Equity Awards at Fiscal Year End 2018
The following table illustrates outstanding Murphy USA equity awards (stock options, RSUs and PSUs) for each NEO as of December 31, 2018.
Option Awards | Stock Awards | ||||||||||||||||||||||||||||||||||||||||||||
Grant | Number of Securities Underlying Unexercised Options Exercisable |
Number of Securities Underlying Unexercised Options Unexercisable(1) |
Option Exercise Price |
Option Expiration (mm/dd/yy) |
Number of Shares or Units of Stock That Have Not Vested(2) |
Market Value of Shares or Units of Stock That Have Not Vested(3) |
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested(4) |
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested(3) | |||||||||||||||||||||||||||||||||||||
Name | Date | (#) | (#) | ($) | Date | (#) | ($) | (#) | ($) | ||||||||||||||||||||||||||||||||||||
R. Andrew Clyde |
|
02/10/15 |
|
|
34,750 |
|
|
|
|
|
70.57 |
|
|
02/10/22 |
|
||||||||||||||||||||||||||||||
02/10/16 | 23,950 | 23,950 | 59.11 | 02/10/23 | |||||||||||||||||||||||||||||||||||||||||
02/08/17 | | 51,800 | 65.75 | 02/08/24 | |||||||||||||||||||||||||||||||||||||||||
02/07/18 | | 38,400 | 71.00 | 02/07/25 | |||||||||||||||||||||||||||||||||||||||||
02/10/16 | 13,250 | 1,015,480 | |||||||||||||||||||||||||||||||||||||||||||
02/08/17 | 12,150 | 931,176 | |||||||||||||||||||||||||||||||||||||||||||
02/07/18 | 9,150 | 701,256 | |||||||||||||||||||||||||||||||||||||||||||
02/10/16 | 43,725 | (5) | 3,351,084 | ||||||||||||||||||||||||||||||||||||||||||
02/08/17 | 48,600 | 3,724,704 | |||||||||||||||||||||||||||||||||||||||||||
|
02/07/18
|
|
|
36,600
|
|
|
2,805,024
|
| |||||||||||||||||||||||||||||||||||||
Mindy K. West |
|
02/10/15 |
|
|
9,700 |
|
|
|
|
|
70.57 |
|
|
02/10/22 |
|
||||||||||||||||||||||||||||||
02/10/16 | 6,600 | 6,600 | 59.11 | 02/10/23 | |||||||||||||||||||||||||||||||||||||||||
02/08/17 | | 14,300 | 65.75 | 02/08/24 | |||||||||||||||||||||||||||||||||||||||||
02/07/18 | | 10,500 | 71.00 | 02/07/25 | |||||||||||||||||||||||||||||||||||||||||
09/06/13 | 12,333 | (6) | 945,201 | ||||||||||||||||||||||||||||||||||||||||||
02/10/16 | 3,650 | 279,736 | |||||||||||||||||||||||||||||||||||||||||||
02/08/17 | 3,350 | 256,744 | |||||||||||||||||||||||||||||||||||||||||||
02/07/18 | 2,500 | 191,600 | |||||||||||||||||||||||||||||||||||||||||||
02/10/16 | 12,045 | (5) | 923,129 | ||||||||||||||||||||||||||||||||||||||||||
02/08/17 | 13,400 | 1,026,976 | |||||||||||||||||||||||||||||||||||||||||||
|
02/07/18
|
|
|
10,000
|
|
|
766,400
|
| |||||||||||||||||||||||||||||||||||||
John A. Moore |
|
02/10/15 |
|
|
6,000 |
|
|
|
|
|
70.57 |
|
|
02/10/22 |
|
||||||||||||||||||||||||||||||
02/10/16 | | 3,800 | 59.11 | 02/10/23 | |||||||||||||||||||||||||||||||||||||||||
02/08/17 | | 6,900 | 65.75 | 02/08/24 | |||||||||||||||||||||||||||||||||||||||||
02/07/18 | | 5,100 | 71.00 | 02/07/25 | |||||||||||||||||||||||||||||||||||||||||
09/06/13 | 5,051 | (6) | 387,109 | ||||||||||||||||||||||||||||||||||||||||||
02/10/16 | 2,100 | 160,944 | |||||||||||||||||||||||||||||||||||||||||||
02/08/17 | 1,650 | 126,456 | |||||||||||||||||||||||||||||||||||||||||||
02/07/18 | 1,200 | 91,968 | |||||||||||||||||||||||||||||||||||||||||||
02/10/16 | 6,930 | (5) | 531,115 | ||||||||||||||||||||||||||||||||||||||||||
02/08/17 | 6,600 | 505,824 | |||||||||||||||||||||||||||||||||||||||||||
|
02/07/18
|
|
|
4,800
|
|
|
367,872
|
| |||||||||||||||||||||||||||||||||||||
Terry P. Hatten |
|
06/12/18 |
|
|
|
|
|
4,000 |
|
|
72.80 |
|
|
06/12/25 |
|
||||||||||||||||||||||||||||||
06/12/18 | 1,000 | 76,640 | |||||||||||||||||||||||||||||||||||||||||||
|
06/12/18
|
|
|
4,000
|
|
|
306,560
|
| |||||||||||||||||||||||||||||||||||||
Robert J. Chumley |
|
02/08/17 |
|
|
|
|
|
6,700 |
|
|
65.75 |
|
|
02/08/24 |
|
||||||||||||||||||||||||||||||
02/07/18 | | 5,100 | 71.00 | 02/07/25 | |||||||||||||||||||||||||||||||||||||||||
02/08/17 | 1,600 | 122,624 | |||||||||||||||||||||||||||||||||||||||||||
02/07/18 | 1,200 | 91,968 | |||||||||||||||||||||||||||||||||||||||||||
02/08/17 | 6,400 | 490,496 | |||||||||||||||||||||||||||||||||||||||||||
|
02/07/18
|
|
|
4,800
|
|
|
367,872
|
|
30 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Executive Compensation (continued)
Option Exercises and Stock Vested in 2018
The following table summarizes the value received by each NEO from stock option exercises and stock grants that vested during 2018.
Option Awards | Stock Awards | |||||||||||||||||||
Name |
Number of Shares Acquired on Exercise (#) |
Value Realized on Exercise(1) ($) |
Number of Shares Acquired on Vesting (#) |
Value Realized on Vesting(2) ($) | ||||||||||||||||
R. Andrew Clyde |
|
168,499 |
|
7,651,752 |
|
41,080 |
|
2,911,248 |
||||||||||||
Mindy K. West |
|
14,300 |
|
647,075 |
|
50,497 |
|
3,958,560 |
||||||||||||
John A. Moore |
|
3,800 |
|
97,280 |
|
12,038 |
|
917,303 |
||||||||||||
Terry P. Hatten |
|
|
|
|
|
|
|
|
||||||||||||
Robert J. Chumley |
|
|
|
|
|
|
|
|
||||||||||||
Daryl R. Schofield |
|
|
|
|
|
8,953 |
|
599,940 |
(1) | The value shown reflects the pre-tax gain realized upon the exercise of options, which is the difference between the fair market value on the date of exercise and the exercise price of the options. |
(2) | The amounts shown in this column reflect the pre-tax gain realized upon vesting of RSUs and PSUs, which is the fair market value of the shares on the date of vesting. |
The following table presents the value of the frozen accrued benefits of the NEOs under the defined benefit portion of the Murphy Oil SERP, liability for which was assumed by Murphy USA in connection with the Spin-Off. Murphy Oil remains responsible for all accrued benefits to our NEOs under the tax-qualified Murphy Oil Retirement Plan.
Name | Plan Name(1) | Number of Years of Credited Service (#)(2) |
Present Value of Accumulated Benefit ($) |
Payments During Last Fiscal Year ($) | |||||||||||||
R. Andrew Clyde |
|
|
|
|
|
|
|
||||||||||
Mindy K. West |
Murphy USA Supplemental Executive Retirement Plan |
|
17.247 |
|
695,927 |
|
|
||||||||||
John A. Moore |
Murphy USA Supplemental Executive Retirement Plan |
|
18.497 |
|
380,200 |
|
|
||||||||||
Terry P. Hatten |
|
|
|
|
|
|
|
||||||||||
Robert J. Chumley |
|
|
|
|
|
|
|
||||||||||
Daryl R. Schofield |
|
|
|
|
|
|
|
(1) | Liabilities for benefits accrued for NEOs and other executive employees under the defined contributions portion of the Murphy Oil SERP were transferred to the Murphy USA SERP effective on the date of the Spin-Off and are included in the 2018 Non-Qualified Deferred Compensation Table that follows. |
(2) | The number of years of credited service reflects the frozen number of years of service credited under the Murphy Oil SERP through the date of the Spin-Off. |
The accrued benefits presented above are based on a final-average-earning calculation. Frozen final average earnings which could not be included under a tax-qualified retirement plan were as follows: Ms. West $286,153, and Mr. Moore $141,236. The following assumptions were used in determining the present value amounts at December 31, 2018:
| Discount Rate - 4.56% |
| Mortality Table - RP-2014 projected 20 years |
| Assumed retirement date at age 62 |
2018 Non-Qualified Deferred Compensation Table
The following table includes the value of the accrued benefits of the NEOs under the defined contribution portion of the Murphy Oil SERP, liability for which was assumed by Murphy USA in connection with the Spin-Off, as well as the benefits accrued by the NEOs under the Murphy USA SERP from the date of the Spin-Off, through December 31, 2018.
Name |
Executive Contributions in Last Fiscal Year(1) ($) |
Registrant Contributions in Last Fiscal Year(2) ($) |
Aggregate Earnings in Last Fiscal Year ($) |
Aggregate Withdrawals / Distributions ($) |
Aggregate Balance at Last FYE(2) ($) | ||||||||||||||||||||
R. Andrew Clyde |
|
245,875 |
|
195,455 |
|
(143,173 |
) |
|
|
|
2,194,668 |
||||||||||||||
Mindy K. West |
|
27,813 |
|
74,476 |
|
(45,449 |
) |
|
|
|
554,875 |
||||||||||||||
John A. Moore |
|
6,665 |
|
53,690 |
|
(18,688 |
) |
|
|
|
243,119 |
||||||||||||||
Terry P. Hatten |
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Robert J. Chumley |
|
19,833 |
|
19,645 |
|
(4,792 |
) |
|
|
|
60,648 |
||||||||||||||
Daryl R. Schofield |
|
56,063 |
|
7,425 |
|
(4,244 |
) |
|
|
|
59,244 |
(1) | The executive contributions in the last fiscal year have been included in the Salary column for the NEO in the 2018 Summary Compensation Table. |
(2) | The registrant contributions in the last fiscal year have been included in the All Other Compensation for the NEO in the 2018 Summary Compensation Table. |
MURPHY USA INC. 31
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Executive Compensation (continued)
Name |
Category | Qualified Termination with a Change of Control ($) |
Death, Disability or Retirement ($) |
Resignation | |||||||||||||
R. Andrew Clyde |
Severance(1) | 7,087,605 | | ||||||||||||||
Non-equity compensation(2) | 1,677,344 | 1,677,344 | |||||||||||||||
Unvested & Accelerated(3) | |||||||||||||||||
Full Value Awards | 7,943,736 | 5,389,555 | |||||||||||||||
Stock Options | 1,200,252 | | |||||||||||||||
Mindy K. West |
Non-equity compensation(2) | 598,560 | 598,560 | ||||||||||||||
Unvested & Accelerated(3) | |||||||||||||||||
Full Value Awards | 3,129,441 | 1,987,812 | |||||||||||||||
Stock Options | 330,645 | | |||||||||||||||
John A. Moore |
Non-equity compensation(2) | 346,752 | 346,752 | ||||||||||||||
Unvested & Accelerated(3) | |||||||||||||||||
Full Value Awards | 1,525,213 | 1,002,681 | |||||||||||||||
Stock Options | 170,519 | | |||||||||||||||
Terry P. Hatten |
Non-equity compensation(2) | 192,992 | 192,992 | ||||||||||||||
Unvested & Accelerated(3) | |||||||||||||||||
Full Value Awards | 229,920 | 48,436 | |||||||||||||||
Stock Options | 15,360 | | |||||||||||||||
Robert J. Chumley |
Non-equity compensation(2) | 344,344 | 344,344 | ||||||||||||||
Unvested & Accelerated(3) | |||||||||||||||||
Full Value Awards | 643,776 | 319,359 | |||||||||||||||
Stock Options | 101,727 | | |||||||||||||||
Daryl R. Schofield |
Severance(4) | | | 842,505 |
32 MURPHY USA INC.
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Executive Compensation (continued)
MURPHY USA INC. 33
NOTICE OF 2019 ANNUAL MEETING AND PROXY STATEMENT
|
Electronic Availability of Proxy Materials for
2019 Annual Meeting
You are urged to follow the instructions for voting contained in the Notice Regarding Availability of Proxy
Materials or,
|
36 MURPHY USA INC.
MURPHY USA
MURPHY USA INC. ATTN: Connie Vaughn-Dunn 200 PEACH STREET EL DORADO, AR 71730 |
VOTE BY INTERNET - www.proxyvote.com Use the Internet to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 P.M. ET on 04/30/2019. 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.
ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.
VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions. Vote by 11:59 P.M. ET on 04/30/2019. 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. |
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: |
||||||
KEEP THIS PORTION FOR YOUR RECORDS |
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
For All |
Withhold All |
|
For 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. |
|||||||||||||||||||||||||||||||||||
The Board of Directors recommends you vote FOR the following: | ||||||||||||||||||||||||||||||||||||||||
☐ | ☐ | ☐ | ||||||||||||||||||||||||||||||||||||||
1. | Election of Three Class III Directors Whose Current Term Expires on the Date of the Annual Meeting |
|
||||||||||||||||||||||||||||||||||||||
Nominees | ||||||||||||||||||||||||||||||||||||||||
01) | R. Madison Murphy 02) R. Andrew Clyde 03) David B. Miller | |||||||||||||||||||||||||||||||||||||||
The Board of Directors recommends you vote FOR proposals 2 and 3. |
For |
Against |
Abstain |
|||||||||||||||||||||||||||||||||||||
2. Approval of Executive Compensation on an Advisory, Non-Binding Basis |
☐ | ☐ | ☐ | |||||||||||||||||||||||||||||||||||||
3. Ratification of Appointment of Independent Registered Public Accounting Firm for Fiscal 2019
|
☐ |
☐ |
☐ |
|||||||||||||||||||||||||||||||||||||
NOTE: Such other business as may properly come before the meeting.
|
||||||||||||||||||||||||||||||||||||||||
|
For address change/comments, mark here. (see reverse for instructions) |
☐ |
||||||||||||||||||||||||||||||||||||||
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. | ||||||||||||||||||||||||||||||||||||||||
Signature [PLEASE SIGN WITHIN BOX]
|
Date |
Signature (Joint Owners) |
Date | |||||||||||||||||||||||||||||||||||||
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice & Proxy Statement, Annual Report is/ are available at www.proxyvote.com.
|
MURPHY USA INC. |
||||||||
Annual Meeting of Stockholders | ||||||||
May 1, 2019 8:00 AM Central Time | ||||||||
This proxy is solicited by the Board of Directors | ||||||||
The stockholder(s) hereby appoint(s) R. Madison Murphy and R. Andrew Clyde, or either of them, as proxies, each with the power to appoint his substitute, and hereby authorizes them to represent and to vote, as designated on the reverse side of this ballot, all of the shares of Common stock of MURPHY USA INC. that the stockholder(s) is/are entitled to vote at the Annual Meeting of Stockholder(s) to be held at 8:00 AM, Central Time on May 1, 2019, at the South Arkansas Arts Center, 110 East 5th Street, El Dorado, Arkansas, 71730, and any adjournment or postponement thereof.
This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, this proxy will be voted in accordance with the Board of Directors recommendations.
Address change/comments: |
||||||||
|
|
|||||||
|
||||||||
|
||||||||
|
(If you noted any Address Changes and/or Comments above, please mark corresponding box on the reverse side.)
Continued and to be signed on reverse side |
|
||||||