(Logo)
February 3, 1997
Dear NUI Shareholder:
We are pleased to invite you to attend the Company's 1997 Annual
Meeting of Shareholders, which will be held at 10:30 a.m. on Tuesday,
March 11, 1997 at the offices of Elizabethtown Gas, 1085 Morris
Avenue, Union, New Jersey.
At the Meeting we will review the Company's financial results for
fiscal year 1996 and share with you our vision for the future of the
Company and our thoughts on the accelerating pace of change occurring
within the energy industry.
We will also consider and vote on the election of two directors and
the appointment of our independent public accountants for the fiscal
year ending September 30, 1997.
Please remember to complete, sign and date the enclosed proxy card and
return it promptly in the postage prepaid envelope provided. Your vote
is important to us.
We look forward to seeing you on March 11.
Sincerely,
JOHN KEAN JOHN KEAN, JR.
Chairman of the Board President and Chief Executive
Officer<PAGE>
(Logo)
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders:
The Annual Meeting of Shareholders of NUI Corporation will be held at
10:30 a.m. on Tuesday, March 11, 1997 at the offices of Elizabethtown
Gas, 1085 Morris Avenue, Union, New Jersey, for the following
purposes:
1. To elect two (2) directors for three year terms expiring in
2000;
2. To ratify the appointment of Arthur Andersen LLP as independent
public accountants for the fiscal year ending September 30,
1997; and
3. To transact such other business as may properly be brought
before the Annual Meeting, or any adjournment thereof.
Only shareholders of record at the close of business on January 27,
1997 shall be entitled to notice of, and to vote at, the Annual
Meeting or any adjournment thereof.
By Order of the Board of Directors
JAMES R. VAN HORN
General Counsel and Secretary
February 3, 1997
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YOUR VOTE IS IMPORTANT. PLEASE COMPLETE, SIGN AND DATE THE ENCLOSED
PROXY CARD AND RETURN IT PROMPTLY IN THE POSTAGE PREPAID ENVELOPE
PROVIDED.
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Convenient parking is available in the immediate vicinity for
shareholders attending the meeting. Directions to the meeting site are
included on the back cover.
NUI CORPORATION
550 Route 202-206, P.O. Box 760
Bedminster, New Jersey 07921-0760
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PROXY STATEMENT
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This Proxy Statement is being furnished to shareholders in
connection with the solicitation by the Board of Directors of NUI
Corporation, a New Jersey corporation (hereinafter referred to as the
"Company" or "NUI") of proxies to be voted at the Annual Meeting of
Shareholders to be held on Tuesday, March 11, 1997 and at any
adjournment or postponement thereof (the "Annual Meeting"). This
Proxy Statement and the accompanying form of proxy are first being
mailed to shareholders on or about February 3, 1997.
Record Date, Shareholders Entitled to Vote and Vote Required
Only shareholders of record of the Company's Common Stock, no par
value (the "Common Stock") at the close of business on January 27,
1997 are entitled to notice of and to vote at the Annual Meeting. As
of January 27, 1997 there were outstanding 11,210,540 shares of Common
Stock entitled to notice of and to vote at the Annual Meeting. These
shares were held by 6,742 shareholders of record.
The presence of a majority of the outstanding shares of Common
Stock, either in person or by proxy, is necessary to constitute a
quorum at the Annual Meeting. Each holder of Common Stock is entitled
to one vote for each share held. The Company's By Laws require the
affirmative vote of a plurality of the votes cast at the Annual
Meeting for the election of directors. The affirmative vote of a
majority of the votes cast is required to ratify the appointment of
Arthur Andersen LLP as the Company's independent public accountants.
Solicitation, Revocation and Voting of Proxies
This solicitation is made on behalf of the Board of Directors of
the Company. The cost of soliciting these proxies will be borne by the
Company. In addition to solicitation by mail, directors, officers and
employees of the Company and its subsidiaries may solicit proxies for
the Annual Meeting from the Company's shareholders personally or by
telephone or telegram without additional remuneration. The Company
will also provide persons, firms, banks and companies holding shares
in their names or in the names of nominees which are beneficially
owned by others, proxy material for transmittal to such beneficial
owners and will reimburse such record owners for their expenses
related to such transmittal. The Company has retained the firm of D.F.
King & Co., Inc. to assist in the solicitation of proxies at a cost of
$5,500, plus expenses.
The form of proxy enclosed is for use at the Annual Meeting. Any
proxy given pursuant to this solicitation may be revoked at any time
prior to its use by delivering a written notice of revocation or a
duly executed proxy bearing a later date to the Secretary of the
Company at the above address, or by attending the Annual Meeting and
voting in person. All shares represented by valid proxies will be
voted at the Annual Meeting in the manner indicated on the proxies. If
no contrary instructions are indicated, such proxies will be voted FOR
the election of each of the nominees to the Board of Directors and FOR
the ratification of Arthur Andersen LLP as independent public
accountants for the fiscal year ending September 30, 1997
Broker non votes and abstentions are not treated as votes cast for
purposes of any of the matters to be voted on at the Annual Meeting.
PROPOSAL NUMBER ONE
ELECTION OF DIRECTORS
The By-Laws of the Company provide that the Board of Directors
shall consist of not less than eight nor more than 25 directors. The
Company currently has eight directors. The By-Laws also provide that
the Board of Directors shall be divided into three classes, with
directors in each class serving three year terms. Approximately one-
third of the Board of Directors is elected each year. The By-Laws
provide that no individual may be elected a director after having
attained his or her seventy-second birthday, although directors who
reach the age of 72 during a term may continue to serve until the
expiration of the term.
It is the intention of the persons named as proxies to vote in
favor of James J. Forese and R. Van Whisnand as directors of the
Company for three-year terms expiring at the 2000 Annual Meeting of
Shareholders or until their successors are elected and shall qualify,
unless otherwise directed by the shareholder on the proxy. Messrs.
Forese and Whisnand were last elected to the Board at the 1994 Annual
Meeting of Shareholders.
While it is anticipated that the nominees will be able to serve, if
any nominee is unable or declines to serve as a director at the time
of the Annual Meeting, proxies will be voted for any nominee who may
be designated by the Board of Directors to fill the vacancy. The By-
Laws of the Company provide that specific advance notification and
information requirements must be satisfied in order for a shareholder
to nominate an individual for election to the Board. No such
nominations have been made. Information concerning these requirements
may be obtained by writing to the Secretary of the Company.
Nominees for Election
Set forth below is information concerning the age, current term,
committee memberships, the period served as a director and business
experience during the past five years with respect to each director
nominee:
(Picture of James J. Forese, age 60
James J. Current term expires in 1997
Forese) Member of the Audit, Executive and Compensation
Committees
Mr. Forese has served as a director of the Company
since 1978. Since January 1, 1997 he has served as
Executive Vice President and President, International
Operations, IKON Office Solutions (office equipment and
supply systems). From January 1, 1996 to December 31,
1996, he served as Executive Vice President, Chief
Operating Officer and a director of Alco Standard Corp.
(office equipment and supply systems). From October,
1993 through December, 1995 he served as General
Manager of Customer Financing for International
Business Machines Corporation ("IBM") and as Chairman
of IBM Credit Corporation. From 1990 through 1995 he
held the additional position of Vice President-Finance
of IBM. Mr. Forese also serves as a director of
American Management Systems, Inc. and Unisource World
Wide Corporation.
(Picture of R. Van Whisnand, age 52
R. Van Current term expires in 1997
Whisnand) Member of the Compensation and Executive Committees
Mr. Whisnand has served as a director since 1982. Since
March, 1995 he has served as a principal of Fox Asset
Management (investment management). Prior thereto Mr.
Whisnand served as a partner in Combined Capital
Management (investment management).
Continuing Board Members
Set forth below is information concerning the age, current term,
committee memberships, the period served as director and business
experience during the past five years with respect to those members of
the Board of Directors whose current terms of office extend beyond
1997:
(Picture of Calvin R. Carver, age 71
C. R. Carver) Current term expires in 1999
Member of the Audit, Executive and Investment Committees
Mr. Carver has served as a director of the Company
since 1969. He served as Executive Vice President of
the Company until his retirement in 1986. He is Vice
President, Treasurer and a director of Penn-Jersey Pipe
Line Co.
(Picture of Dr. Vera King Farris, age 56
Dr. Vera Current term expires in 1999
King Farris) Member of the Compensation and Investment Committees
Dr. Farris has served as a director of the Company
since 1994. She is President of The Richard Stockton
College of New Jersey. She also serves as a director of
Flagstar Companies, Inc. and on the boards of numerous
educational and civic organizations.
(Picture of John Kean, age 67
John Kean) Current term expires in 1998
Chairman of the Board of Directors
Member of the Executive and Investment Committees
Mr. Kean has served as a director since 1969. He served
as Chief Executive Officer of the Company from 1969
until his retirement in April, 1995, holding the
positions of Chairman of the Board since October, 1994
and President from 1969 until October, 1994. Mr. Kean
is also a director of E'Town Corporation and its
subsidiary, Elizabethtown Water Company.
(Picture of John Kean, Jr., age 39
John Current term expires in 1998
Kean, Jr.) President and Chief Executive Officer
Member of the Executive Committee
Mr. Kean has served as a director since 1995. Since
April, 1995 he has served as President and Chief
Executive Officer of the Company. From October, 1994
through March, 1995 he served as President and Chief
Operating Officer. He served as Executive Vice
President of the Company from January 1992 to September
1994 and as Executive Vice President of Elizabethtown
Gas Company from March 1993 to September 1994. Prior to
March, 1993 Mr. Kean held the additional position of
Chief Financial Officer of the Company. He also serves
on the Board of Trustees of the Institute of Gas
Technology.
(Picture of Dr. Bernard S. Lee, age 62
Dr. Bernard Current term expires in 1998
S. Lee) Member of the Audit and Compensation Committees
Dr. Lee has served as a director since 1992. He is
Chief Executive Officer and President of the Institute
of Gas Technology. Dr. Lee is also a director of
Peerless Mfg. Co., Energy BioSystems Corporation and
National Fuel Gas Company.
(Picture of John Winthrop, age 60
John Current term expires in 1999
Winthrop) Member of the Audit and Investment Committees
Mr. Winthrop has served as a director since 1978. He is
President of John Winthrop & Co., Inc. and a partner of
Winthrop Melhado Flynn (both investment management
firms). He also serves as a director of the American
Farmland Trust and several mutual funds, including
certain Alliance Capital Funds and the Pioneer Funds.
Committees and Meetings of the Board of Directors
The Board of Directors holds regular meetings every other month and
special meetings as necessary from time to time. The Board held nine
meetings during fiscal year 1996. During the year, total attendance at
Board and Committee meetings was 94%. No member of the Board attended
fewer than 75% of the aggregate of meetings of the Board and meetings
of Committees on which such director served. The Board has an
Executive, Audit, Compensation and Investment Committee and does not
have a Nominating Committee. Information on the Committees of the
Board is set forth below.
The Executive Committee has the authority (with certain exceptions)
to take such actions as the Board of Directors is authorized to take.
The Committee does not hold regularly scheduled meetings, but remains
on call. The Committee held no meetings during fiscal year 1996. The
current members of the Executive Committee are Calvin R. Carver, James
J. Forese, John Kean (Chairman), John Kean, Jr. and R. Van Whisnand.
The Audit Committee has the responsibility to review and approve
the scope of the annual audit; to recommend to the Board the
appointment of independent public accountants; to review and approve
the adequacy of the Company's system of internal controls; and to
review any non-audit services provided by the independent public
accountants. The Committee met four times during fiscal year 1996. The
current members of the Audit Committee are Calvin R. Carver, James J.
Forese (Chairman), Bernard S. Lee and John Winthrop.
The Investment Committee has the responsibility to oversee the
investment of assets held by the Company's retirement plans and
savings and investment plans. The Committee selects investment
managers, establishes guidelines under which they operate and reviews
their performance. The Committee met four times during fiscal year
1996. The current members of the Investment Committee are Calvin R.
Carver (Chairman),Vera King Farris, John Kean and John Winthrop.
The Compensation Committee has the responsibility to review and
make recommendations to the Board of Directors regarding the annual
salaries and cash bonuses to be paid to officers of the Company, its
divisions and subsidiaries; to review and make recommendations to the
Board concerning the Company's executive compensation policies,
practices and objectives; to administer the Company's 1988 Stock Plan
and 1996 Stock Option and Stock Award Plan (the "Stock Plans"); and
to make grants and awards under the Stock Plans, establishing vesting
and other criteria applicable to any such grants and awards. The
Committee met three times in fiscal year 1996. For additional
information on the role and activities of the Committee, please see
"Compensation Committee Report on Executive Compensation" located
later in this Proxy Statement. The current members of the Compensation
Committee are Vera King Farris, James J. Forese, Bernard S. Lee and R.
Van Whisnand (Chairman).
Compensation of Directors
The compensation program for directors is designed to closely align
the interests of directors with the interests of shareholders. Each
non-employee director of the Company (with the exception of John Kean)
is paid a retainer fee in stock pursuant to the Company's Stock Plans
that consists of a deferred grant of shares of Common Stock. The
number of shares of Common Stock credited to the accounts of such non-
employee directors is determined by dividing $15,000 by the closing
price of the Common Stock on the date of the annual organization
meeting of the Board. Directors who chair Board Committees (with the
exception of John Kean) receive an additional deferred grant of Common
Stock with a value of $2,500 on the date of the Board's organization
meeting. On each Common Stock dividend payment date, these directors
are credited with an additional number of shares as if the shares in
their deferred accounts had actually been issued and the dividends
reinvested. The shares of Common Stock credited to a director under
the Stock Plans are issued upon the director's retirement or other
termination of the director's service as a member of the Board. As of
September 30, 1996, the total deferred grants for non-employee
directors provide for the issuance of 22,423 shares of Common Stock,
an increase of 5,253 shares during fiscal year 1996. In addition to
these retainers, non-employee directors (with the exception of John
Kean) are paid $600 for attendance at each regular or special meeting
of the Board of Directors and any Committee thereof.
The Company is party to a Consulting Agreement, dated March 24,
1995, with John Kean, who retired as Chief Executive Officer of the
Company effective April 1, 1995. The Agreement has a three-year term
and expires on March 31, 1998. Under the Agreement, Mr. Kean is
providing consulting services to the Company for up to 110 hours each
calendar month. The Agreement requires Mr. Kean to devote sufficient
time and effort to perform such duties as may be assigned by the
Company or the Board of Directors from time to time. The Agreement
also provides that during the term of the Agreement, if Mr. Kean
remains a director, he shall hold the position of Chairman of the
Board. In consideration of the services rendered under the Agreement,
the Company provides Mr. Kean with an annual fee of $150,000 and
office space, clerical support, expense reimbursement and life, health
and medical coverages similar to those previously provided to him when
he was an employee of the Company. Other than amouns paid and the
benefits provided under the Agreement, Mr. Kean does not receive any
additional compensation for serving on the Board or Committees of the
Board of the Company, its divisions or subsidiaries. The Agreement
will terminate automatically in the event of Mr. Kean's death and may
be terminated by the Company for cause or if Mr. Kean should become
disabled. Mr. Kean may terminate the Agreement for "Good Reason" (as
defined in the Agreement) following a change in control of the
Company, upon the impairment of his health or upon thirty days prior
written notice. Upon a change in control of the Company, the Agreement
is automatically extended for three years following such change in
control. In addition, if, following a change in control, the Agreement
is terminated by Mr. Kean for Good Reason or by the Company (or its
successor) other than as a result of Mr. Kean's disability or for
cause, Mr. Kean shall be entitled to receive (i) an amount equal to
the amounts which would have otherwise been paid to him if the
Agreement had remained in effect through its term, (ii) the
continuation of benefits through the term of the Agreement, and (iii)
an amount, if necessary, in order to offset the impact of the
application of any excise tax imposed under the Internal Revenue Code
upon the value of such payments and benefits.
Calvin R. Carver and John Kean currently serve as members of the
Advisory Board of the Company's Elizabethtown Gas division. Mr. Kean
receives no additional compensation for serving on this Board and Mr.
Carver is paid a $1,000 annual retainer and $450 for each
Elizabethtown Gas Board and Committee meeting attended.
The Company has in effect a retirement plan for directors. To be
eligible for retirement benefits under the Plan, a director must have
served as a director for at least ten years, with a minimum of five
years of service as a non-employee of the Company and its
subsidiaries. An eligible participant in the Plan will be paid, upon
retirement at or after age 70, an annual retirement benefit for life
equal to the value of the annual Board retainer in effect at the time
of the director's retirement, subject to a minimum annual benefit of
$8,000.
Compensation Committee Interlocks and Insider Participation
Proxy disclosure rules require the Company to report certain
relationships involving the Company in which members of the
Compensation Committee have a direct or indirect material interest.
Also required is disclosure of interlocking relationships among
Compensation Committee members and those executive officers of the
Company, if any, who also serve as members of compensation committees
or executive officers at other companies. The purpose of these
requirements is to allow shareholders to assess the independence of
the Company's Compensation Committee members in making executive
compensation decisions and recommendations. While the Company has had
transactions with companies and firms with which certain members of
the Compensation Committee are, or at some point during fiscal year
1996 were, affiliated as an officer and/or director, there are no such
relationships in which members of the Committee have a direct or
indirect material interest. In addition, there are no interlocking
relationships of the nature described above involving members of the
Compensation Committee. The members of the Compensation Committee are
Vera King Farris, James J. Forese, Bernard S. Lee and R. Van Whisnand
(Chairman).
Certain Transactions
Companies and firms with which certain directors are, or during
fiscal year 1996 were, affiliated as an officer and/or director had
transactions in the ordinary course of business with the Company
during fiscal year 1996 and similar transactions are expected to occur
in the future. Except as discussed in the next paragraph, none of
these directors had a direct or indirect material interest in such
transactions. The companies or firms involved in these transactions
and the related directors are: Alliance Capital Management (John
Winthrop), E'Town Corporation and Elizabethtown Water Company (John
Kean), Fox Asset Management (R. Van Whisnand), Institute of Gas
Technology (John Kean, Jr. and Bernard S. Lee), International Business
Machines Corporation (James J. Forese), and Penn-Jersey Pipeline Co.
(Calvin R. Carver).
In August 1987, Elizabethtown Gas Company entered into an Agreement
of Lease with Liberty Hall Joint Venture for the occupancy of
approximately 160,000 square feet of a 200,000 square foot office
building in Union, New Jersey. On December 9, 1987, the predecessor to
the New Jersey Board of Public Utilities authorized the acceptance of
this agreement subject to certain conditions. The Joint Venture
participants are Cali Liberty Hall Associates (a New Jersey general
partnership) and a Kean family trust of which John Kean and Stewart B.
Kean are trustees. Stewart B. Kean is the brother of John Kean and
beneficially owns in excess of 5% of the Company's Common Stock (see
"Ownership of Voting Securities by Certain Beneficial Owners and
Management"). All negotiations relative to the lease were conducted
between Elizabethtown Gas Company and Cali Liberty Hall Associates. No
person involved with the Kean family trust participated in such
discussions. The annual base rent is approximately $2.9 million from
1996 through 1999, $3.3 million from 2000 through 2004, and $3.7
million from 2005 through 2009.
Family Relationships
John Kean is the father of John Kean, Jr.
THE BOARD OF DIRECTORS RECOMMENDS SHAREHOLDERS VOTE FOR THE
ELECTION OF THE DIRECTOR NOMINEES LISTED ABOVE. Proxies solicited by
management will be voted FOR the election of all director nominees
unless contrary voting instructions are indicated.
PROPOSAL NUMBER TWO
RATIFICATION OF AUDITORS
The accounting firm of Arthur Andersen LLP, 1345 Avenue of the
Americas, New York, N.Y. 10105 has been selected by the Board of
Directors, upon the recommendation of its Audit Committee, to serve as
independent public accountants for the Company and its subsidiaries
for the fiscal year ending September 30, 1997. This firm has served as
auditors for the Company since 1969. It is expected that
representatives of Arthur Andersen LLP will be present at the Annual
Meeting. They will have the opportunity to make a statement and will
be available to respond to appropriate questions.
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE APPOINTMENT OF
ARTHUR ANDERSEN LLP AND RECOMMENDS SHAREHOLDERS VOTE FOR THE
RATIFICATION OF THIS APPOINTMENT. Proxies solicited by management will
be voted FOR this proposal unless a vote against this proposal or
abstention is specifically indicated. In the event of an insufficient
number of votes to ratify this appointment, the Board of Directors
will reconsider its selection of Arthur Andersen LLP as independent
public accountants.
OWNERSHIP OF VOTING SECURITIES BY CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership of Certain Beneficial Owners.The Company's
management is aware of only one shareholder, Stewart B. Kean, who owns
beneficially more than five percent of the Company's Common Stock.
Information concerning this shareholder and his Common Stock ownership
is set forth below.
Name and Address of Number Percent
Beneficial Owner of Shares of Class
Stewart B. Kean 735,622(1) 6.6%
Box 1, Elizabeth, New Jersey 07207
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(1) Includes (a) 361,999 shares over which Stewart B. Kean has sole
voting and investment power, and (b) 373,623 shares over which Mr.
Kean has shared voting and investment power as a co-trustee under
various trusts for the benefit of members of the Kean family.
Security Ownership of Management. The following table shows, as of
December 31, 1996, the number and percent of the shares of Common
Stock beneficially owned by each director, each executive officer
listed in the Summary Compensation Table and all directors and
executive officers of the Company as a group:
Title of Number of Percent of
Class Beneficial Owner Shares(1)(2) Class
Common Stock Calvin R. Carver 125,506(3) 1.1%
Vera King Farris 2,555 *
James J. Forese 4,493 *
John Kean 514,445(4) 4.6%
John Kean, Jr. 66,317 *
Bernard S. Lee 6,634(5) *
R. Van Whisnand 4,493 *
John Winthrop 8,577 *
Frank T. Bahniuk 16,409 *
Robert P. Kenney 27,678 *
Lyle C. Motley, Jr. 11,166 *
David P. Vincent 28,745 *
20 directors and
executive officers
as a group 883,458 7.9%
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* Less than 1.0%.
(1) Includes (a) the number of shares of Common Stock issuable to non-
employee directors upon termination of Board service in payment for
their annual Board and Committee chair retainers, as follows:
Calvin R. Carver, James J. Forese and R. Van Whisnand, 4,343 shares
each; John Winthrop, 3,902 shares; Bernard S. Lee, 3,329 shares;
Vera King Farris, 2,163 shares; and all directors as a group,
22,423 shares; (b) shares of restricted stock, as follows: John
Kean, Jr., 39,000 shares; Robert P. Kenney, 13,652 shares; Frank T.
Bahniuk, 8,200 shares; Lyle C. Motley, Jr., 9,504 shares; David P.
Vincent, 8,385 shares; and all directors and officers as a group,
123,397 shares; and (c) shares that are subject to currently
exercisable stock options, as follows: John Kean, Jr., 5,000
shares; David P. Vincent, 4,800 shares; and all directors and
officers as a group, 9,800 shares. Mr. Kenney retired from the
Company effective on January 1, 1997 and all of his shares of
restricted stock vested on that date.
(2) Except as noted, each beneficial owner indicated has sole voting
and investment power with respect to the shares indicated next to
such person's name.
(3) Includes 600 shares with respect to which Mr. Carver disclaims
beneficial ownership.
(4) Includes 140,822 shares over which John Kean has sole voting and
investment power and 373,623 shares over which Mr. Kean has shared
voting and investment power as a co-trustee under various trusts
for the benefit of members of the Kean family.
(5) Includes 1,000 shares held by Dr. Lee's wife.
EXECUTIVE OFFICERS
The following information is provided with respect to each
executive officer of the Company. Officers are elected annually at the
first meeting of the Board of Directors following the Annual Meeting.
There are no arrangements or understandings between any officer and
any other person pursuant to which the officer was selected. Robert P.
Kenney, who is listed later in this Proxy Statement in the Summary
Compensation Table, retired from the Company in January, 1997 and is
therefore no longer an executive officer.
John Kean, Jr., age 39
President and Chief Executive Officer
Since April, 1995 Mr. Kean has served as President and Chief
Executive Officer of the Company. From October, 1994 through March,
1995 he served as President and Chief Operating Officer. From March,
1993 to September, 1994 he served as Executive Vice President of
Elizabethtown Gas Company. Prior thereto, he served as Chief Financial
Officer of the Company. He held the additional position of Executive
Vice President of the Company from January, 1992 to September, 1994.
Frank T. Bahniuk, age 59
Senior Vice President-Energy Management
Mr. Bahniuk has served as Senior Vice President of the Company
since August, 1994. Prior thereto, he served as Senior Vice President
of Elizabethtown Gas.
Michael J. Behan, age 50
Vice President-New Ventures
Mr. Behan has served as Vice President since March, 1993, and as
President of NUI Environmental Group, Inc. since its formation in
1996. Prior thereto he served as Assistant Vice President.
James W. Crowley, Jr., age 57
Vice President-Customer Service
Mr. Crowley has served as Vice President since March 1, 1996. Prior
thereto he served as Vice President-Customer Field Services of The
Brooklyn Union Gas Company.
Victor A. Fortkiewicz, age 44
President, Northern Division
Mr. Fortkiewicz became President of the Northern Division effective
January 1, 1997. From October, 1995 to December, 1996 he served as
Vice President of the Company. Prior thereto, he served as Vice
President of Elizabethtown Gas.
Richard L. Gruber, age 37
Vice President-Marketing
Mr. Gruber has served as Vice President of the Company and as
President of NUI Energy, Inc. since January, 1996. He served as
Managing Member for Exchange Development Corp. L.L.C. from 1994 to
1996. Prior thereto he served as Director of Business Development for
Electronic Data Systems.
Stephen M. Liaskos, age 45
Vice President and Controller
Mr. Liaskos has served as Controller since September, 1995 and Vice
President since March, 1996. From 1992 until September, 1995 he served
as an independent financial and accounting consultant and prior
thereto he served as Vice President and Controller of
Metallgesellschaft Corp.
Robert F. Lurie, age 39
Vice President and Treasurer
Mr. Lurie has served as Treasurer since February, 1994 and Vice
President since March, 1996. Prior thereto he served as Director of
the Office of Public Finance for the Treasury Department of the State
of New Jersey.
Lyle C. Motley, Jr., age 55
President-Southern Division
Mr. Motley has served as President of the Southern Division, which
consists of City Gas Company of Florida and the former Pennsylvania
and Southern Gas Company, since April, 1995. From March, 1992 through
March, 1995 he served as President, and prior thereto as Executive
Vice President, of Pennsylvania and Southern Gas Company, which was
acquired by the Company in April, 1994.
Richard J. O'Neill, age 57
Vice President-Human Resources
Mr. O'Neill has served as Vice President since October, 1995. From
April, 1995 through September, 1995 he served as Senior Vice
President, and prior thereto as Group Vice President, of Elizabethtown
Gas.
James R. Van Horn, age 40
Vice President, General Counsel and Secretary
Mr. Van Horn has served as General Counsel and Secretary since
June, 1995 and Vice President since March 1996. Prior thereto he
served as Senior Vice President, General Counsel and Secretary of
Citizens First Bancorp, Inc. and Citizens First National Bank of New
Jersey.
David P. Vincent, age 53
Vice President-Information Technology
Mr. Vincent has served as Vice President since March 1996. He
served as Chief Technology Officer of the Company from October, 1995
to March, 1996. From April through September, 1995 he served as a
Senior Vice President of Elizabethtown Gas. From March, 1993 through
March, 1995 he served as Executive Vice President and Chief Financial
Officer of the Company and prior thereto he served as Executive Vice
President of the Company.
EXECUTIVE COMPENSATION
Compensation Committee Report on Executive Compensation
The Compensation Committee of the Board of Directors (the
"Committee") is comprised of four independent, non-employee
directors. The Committee has the responsibility of making
recommendations to the Board concerning the Company's executive
compensation policies, practices and objectives. The Committee makes
recommendations to the Board concerning base salary levels and cash
bonus awards for the officers of the Company, its divisions and
subsidiaries and it administers the Cornpany's 1988 Stock Plan and
1996 Stock Option and Stock Award Plan (the "Stock Plans"), making
grants and awards under the Stock Plans to selected key employees in
its discretion.
In discharging its responsibilities, the Committee draws upon
various resources, including but not limited to the varied business
experiences and knowledge of Committee members and other non-employee
directors in the area of executive compensation and the advice of
independent compensation experts. These resources allow the Committee
to stay abreast of current trends and developments in executive
compensation and provide valuable guidance to the Committee in making
decisions and recommendations to the Board of Directors.
The Committee strongly believes that the executive compensation
program should be designed to align the interests of management
closely with the interests of shareholders and to tie compensation
levels to the performance of the Company and the achievement of long-
term and short-term goals and objectives. The Committee also
recognizes the importance of a strong executive compensation program
to attracting and retaining qualified executives. Accordingly, the
program is designed to:
o Provide short-term incentives for individual and Company
performance through the payment of cash bonuses;
o Provide long-term incentives for enhancing shareholder value
through equity-based compensation which is earned upon the
achievement of specific Company performance goals; and
o Provide the Company with the ability to attract, motivate and
retain key executives who are critical to the success of the
Company through the payment of competitive base salaries, the
opportunity to earn incentive compensation and through the
provision of a competitive benefits package.
The components of the Company's executive compensation program are
base salary, annual cash bonuses, long-term incentive compensation and
various benefits. Long-term compensation is comprised of grants and
awards under the Company's Stock Plans pursuant to which the Committee
may make stock awards and grants of restricted stock, stock options
and stock appreciation rights. The benefits provided to executives
include medical, retirement and savings plans which are available to
employees generally and supplementary medical and retirement plans
that are not available to employees generally.
Consistent with the Committee's overall objective of aligning the
interests of management with the interests of shareholders and
providing an incentive for the enhancement of shareholder value, the
Committee made grants of restricted Common Stock for fiscal year 1996
to certain key employees of the Company, including the officers listed
in the Summary Compensation Table (with the exception of Robert P.
Kenney). The terms of these grants require that the Company achieve
specific goals for earnings per share growth during each of the next
four fiscal years in order for the recipients to receive all of the
shares of Common Stock granted. Ownership of the shares will vest 50%
after two years, 25% after the third year and 25% after the fourth
year, subject to the condition that the performance objectives have
been attained. A reduced number of the granted shares will be earned
if these objectives are not met. The Committee has the authority to
make adjustments to these performance goals if it deems such
adjustments appropriate.
In addition, to further align management's interest with NUI
shareholders, the Committee recently recommended, and the Board of
Directors approved, minimum stock ownership requirements for both
officers and directors of the Company. The resolution adopted by the
Board requires that within a six-year period, the Chief Executive
Officer must own Company Common Stock with a market value equal to a
minimum of four times his then current base salary. Other executive
officers must own Common Stock with a market value equal to a minimum
of two times their then current base salary; and non-executive
officers at or above the level of Vice President must own Common Stock
with a market value equal to their then current base salary. Only
shares which are owned outright by these officers will be included in
determining their compliance with these requirements; shares of
restricted Common Stock which have not vested, as well as shares which
have not yet vested under the Company's benefit plans, are not
included in determining compliance. Within the six-year compliance
period, members of the Board of Directors are also required to own
shares of Common Stock with a market value equal to a minimum of six
times the then current value of the Board's annual retainer. This
would be equivalent to $90,000 based upon the current retainer of
$15,000 paid to members of the Board. For purposes of determining
compliance with this requirement, shares owned outright by directors
will be combined with any shares credited to their deferred stock
accounts in accordance with the Stock Plans. The purpose of these
minimum stock ownership requirements is to help ensure the alignment
of the interests of management and the Board of Directors with the
interests of shareholders. The Board has directed the Committee to
regularly monitor the progress of officers and directors toward
compliance.
In establishing recommendations to be made to the Board of
Directors for increases in base salary and for cash bonuses for the
Company's executives, including the Chief Executive Officer for fiscal
year 1996, the Committee considered a number of factors, including
various measures of the Company's financial performance, relative both
to historical Company performance and the performance of other natural
gas distribution companies. The Committee also considered management's
achievement of a number of goals during the year, including net income
and earnings per share objectives as well as the individual
performance and contributions made by each executive officer. These
factors were considered collectively, with no specific weight given to
each factor. The general conclusion of the Committee after this
evaluation was that on an overall basis salary increases should be in
line with the average level of executive raises nationwide and cash
bonus payments should reflect the significant improvement in the
Company's financial results in fiscal year 1996 as well as the
individual contributions of each executive officer to this and other
Company achievements.
The compensation paid to John Kean, Jr., President and Chief
Executive Officer of the Company, with respect to fiscal year 1996 is
set forth in the Summary Compensation Table. Mr. Kean's salary
increased by approximately 9% in 1996 from the salary he received in
1995. This increase is the result of a 4% base salary increase he
received effective January 1, 1996 and a full year's effect of the
salary increase he received when be was elected Chief Executive
Officer of the Company in April, 1995. The cash bonus awarded to Mr.
Kean, in the amount of $134,400, reflected the assessment of the
Committee and the Board of Directors that Mr. Kean's performance
during fiscal year 1996 was commendable. The factors considered by the
Committee and the Board in reaching this conclusion included the
significant improvement in the Company's financial performance in
fiscal year 1996 and resulting increase in the Common Stock dividend;
the successful recruitment by Mr. Kean of several key officers; the
successful establishment and expansion of the Company's non-regulated
businesses; the overall improvement in the operations and financial
performance of the Company's gas distribution businesses; and his
successful leadership of the Company. None of these factors were given
specific weight, but instead were considered collectively. In order to
provide a long-term incentive to Mr. Kean to continue to improve upon
the financial performance of the Company and enhance shareholder
value, the Committee awarded him 15,000 shares of restricted Common
Stock. In order for Mr. Kean to obtain ownership of these shares,
certain vesting and company performance conditions must be satisfied.
This restricted stock award is consistent with the Committee's
objective of aligning the interests of management with the interests
of shareholders.
The Committee believes that the Company's executive compensation
program is well structured and provides maximum incentive to
executives to continually improve upon the financial performance of
the Company; to attract, retain and motivate key officers; and to
enhance shareholder wealth.
Members of the Compensation Committee
R. Van Whisnand, Chairman
Vera King Farris
James J. Forese
Bernard S. Lee
Performance Graph
The graph below reflects the performance of the Company's Common
Stock during the past five fiscal years and compares that performance
with the performance of a broad market index, the S & P 500, and the
performance of an industry index during that same period of time. The
industry index is an index of natural gas distribution companies
prepared by Edward D. Jones & Co. The chart below tracks the
performance of an investment of $100 on October 1, 1991 and assumes
the reinvestment of dividends.
NUI TOTAL RETURN COMPARISON
1991 1992 1993 1994 1995 1996
NUI 100.0 156.4 204.9 138.0 133.4 160.3
Gas Utilities 100.0 121.7 155.3 138.8 149.1 181.5
S&P 500 100.0 111.0 125.4 130.0 168.6 202.7
Annual Compensation, Long-Term Compensation and All Other Compensation
The following table summarizes the compensation paid during fiscal
year 1996 to the Company's Chief Executive Officer and each of the
four other most highly compensated executive officers.
<TABLE>
Summary Compensation Table
<CAPTION>
Long-Term
Annual Compensation Compensation
Name and Other Annual Restricted All Other
Principal Salary Bonus Compensation Stock Awards Compensation
Position(1) Year ($) ($) ($)(2) ($)(3) ($)(4)
<S> <C> <C> <C> <C> <C> <C>
John Kean, Jr. 1996 $242,050 $134,400 -- $292,500 $16,554
President and Chief 1995 221,200 -0- -- 243,750 6,389
Executive Officer 1994 177,800 -0- -- 100,050 6,842
Robert P. Kenney 1996 $216,108 $80,700 -- $-0- $16,655
President and CEO 1995 208,025 20,980 -- 108,257 9,342
Northern Division 1994 200,275 -0- -- 82,800 7,283
Frank T. Bahniuk 1996 $154,500 $56,200 -- $ 78,000 $12,931
Senior Vice President- 1995 147,675 12,000 -- 61,912 10,589
Energy Management 1994 139,150 23,600 -- 5,655 10,097
Lyle C. Motley, Jr. 1996 $155,625 $50,400 -- $ 87,750 $35,538
President-Southern 1995 117,644 15,000 -- 78,146 6,643
Division 1994 37,008 -0- -- 2,828 2,338
David P. Vincent 1996 $165,400 $29,800 -- $ 58,500 $13,119
Vice President- 1995 165,400 -0- -- 49,237 8,445
Information Technology 1994 163,700 -0- -- 8,410 6,427
-----------------
<F1>
(1) Mr. Motley joined the Company on April 19, 1994 and compensation
information for Mr. Motley in 1994 relates to the period of April
19-September 30, 1994. Mr. Kenney retired from the Company
effective January 1, 1997.
<F2>
(2) No figures appear in the "Other Annual Compensation" column
because the dollar value of perquisites paid to these officers did
not exceed the lesser of $50,000 or 10% of the total of annual
salary and bonus for any of these officers.
<F3>
(3) The number of shares of restricted stock granted to the listed
officers with respect to fiscal year 1996 is as follows: John Kean,
Jr.- 15,000; Robert P. Kenney - 0; Frank T. Bahniuk - 4,000; Lyle C.
Motley, Jr. - 4,500; and David P. Vincent - 3,000. These shares will
vest over a four year period as follows: 50% after two years, 25%
after three years and 25% after four years. In order for recipients
to receive the granted shares, specific performance goals must be
achieved by the Company.
Set forth below is information on current outstanding restricted
stock for the listed officers as of September 30, 1996. Prior to
vesting, the recipients receive dividends on these shares and have
voting rights with respect to these shares. Mr. Kenney retired from
the Company, effective January 1, 1997 and all of his shares of
restricted stock vested on that date.
</TABLE>
<TABLE>
<CAPTION>
Date of Number of Value on Vesting Schedule
Name Grant Shares 9/30/96 Shares Date
<S> <C> <C> <C> <C> <C>
John Kean, Jr. 11/23/92 700 $13,475 700 11/23/96
11/23/93 1,400 $26,950 700 11/22/96
700 11/22/97
11/22/94 6,900 $132,825 3,450 11/22/96
1,725 11/22/97
1,725 11/22/98
11/28/95 15,000 $288,750 7,500 11/28/97
3,750 11/28/98
3,750 11/28/99
Frank T. Bahniuk 11/22/94 390 $ 7,508 195 11/22/96
97 11/22/97
98 11/22/98
11/28/95 3,810 $ 73,343 1,905 11/28/97
952 11/28/98
953 11/28/99
Robert P. Kenney 11/23/92 850 $ 16,363 850 11/23/96
11/22/93 1,600 $ 30,800 800 11/22/96
800 11/22/97
11/22/94 4,540 $ 87,395 2,270 11/22/96
1,135 11/22/97
1,135 11/22/98
11/28/95 6,662 $128,244 3,331 11/28/97
1,665 11/28/98
1,666 11/28/99
Lyle C. Motley, Jr. 11/22/94 195 $ 3,754 97 11/22/96
49 11/22/97
49 11/22/98
11/28/95 4,809 $ 92,573 2,404 11/28/97
1,202 11/28/98
1,203 11/28/99
David P. Vincent 11/23/92 625 $ 12,031 625 11/23/96
11/23/93 1,150 $ 22,138 575 11/22/96
575 11/22/97
11/22/94 580 $ 11,165 290 11/22/96
145 11/22/97
145 11/22/98
11/28/95 3,030 $ 58,328 1,515 11/28/97
757 11/28/98
758 11/28/99
<F4>
(4) Includes the following amounts representing the employer match
under qualified savings plans during fiscal year 1996: John Kean,
Jr.--$4,500; Frank T. Bahniuk--$4,447; Robert P. Kenney--$4,500;
Lyle C. Motley, Jr.--$4,125; and David P. Vincent--$4,500. Also
includes the following amounts representing the value of group life
insurance premiums paid during fiscal year 1996: John Kean, Jr.--
$264; Frank T. Bahniuk--$1,800; Robert P. Kenney--$2,808; Lyle C.
Motley, Jr.--$761 and David P. Vincent--$1,152. Includes the
following amounts paid to the listed officers during fiscal year
1996 with respect to Company's medical expense reimbursement plan,
which provides officers with supplemental medical coverage: John
Kean, Jr.--$1,010; Frank T. Bahniuk--$1,459; Robert P. Kenney--
$4,206; and David P. Vincent--$71. Also includes relocation
reimbursement to Lyle C. Motley, Jr.--0$24,489.
</TABLE>
Options and Stock Appreciation Rights
No options or Stock Appreciation Rights (SARs) were granted during
fiscal year 1996 to any of the officers listed in the Summary
Compensation Table and no outstanding options or SARs were repriced in
the most recent fiscal year. The table set forth below provides
information concerning all currently outstanding stock options held by
officers listed in the Summary Compensation Table.
<TABLE>
Aggregated Option/SAR Exercises in 1996 Fiscal Year
Option and SAR Values as of September 30, 1996
<CAPTION>
Value of
Unexercised
Shares In-the-Money
Acquired Number of Securities Options/SARs
on Value Underlying Unexercised at FY End
Exercise Realized Options/SARs at FY-End(#) Exercisable/
Name (#) Exercisable/Unexercisable Unexercisable(1)
<S> <C> <C> <C> <C>
John Kean, Jr. --- --- 5,000/--- $ 8,125
David P. Vincent --- --- 4,800/--- $16,704
--------------
<F1>
(1) The market value of the Common Stock as of September 30, 1996 was
$19.25. Mr. Kean has an option to purchase 5,000 shares at a per
share exercise price of $17.625. Mr. Vincent has an option to
purchase 4,800 shares at a per share exercise price of $15.77.
</TABLE>
Retirement Benefit Plans
The executive officers of the Company earn retirement benefits that
may be payable under three separate plans: (1) the Company's
Retirement Plan, a funded plan in which more than 70% of the Company's
employees are eligible to participate; (2) the ERISA Excess Benefits
Plan, an unfunded plan that is designed to provide benefits for those
participants in the Retirement Plan for whom benefits are reduced by
reason of the limitations imposed under Section 415 of the Internal
Revenue Code of 1986, as amended from time to time (the "Code"); and
(3) the Supplemental Retirement Benefits Plan, an unfunded plan that
provides additional benefits to certain key executive employees,
including those listed in the Summary Compensation Table. While
participants in the Retirement Plan and the ERISA Excess Benefits Plan
become vested in their entitlement to benefits under vesting
requirements established under the Employee Retirement Income Security
Act of 1974, participants in the Supplemental Retirement Benefits Plan
are eligible to receive benefits from the plan only if they reach
retirement age while working for the Company.
The Retirement Plan, which is funded entirely by the Company,
provides that a participant retiring at or after age 65 (or at or
after age 62 with at least 25 years of credited service) will receive
an annual retirement benefit equal in amount (when calculated as a
life annuity with two years certain) to 1-1/2% of the participant's
final average compensation (the average of the highest sixty
consecutive months' base salary) multiplied by the number of years of
credited service. Benefits payable to participants in the Retirement
Plan may be reduced by reason of the limitations imposed under Section
415 of the Code. The ERISA Excess Benefits Plan will pay the
difference between the amount payable to the participant under the
Retirement Plan and the amount the participant would have been paid
but for the limitations imposed under Section 415 of the Code.
Benefits under this plan are subject to the same terms and conditions
as the benefits payable to the participant under the Company's
Retirement Plan.
The unfunded Supplemental Retirement Benefits Plan provides that
each eligible employee who reaches retirement age while working for
the Company may receive an annual retirement benefit equal in amount
(when calculated as a life annuity with two years certain) to 2% of
the participant's final average total compensation (the average of the
highest sixty consecutive months' earnings, including cash bonuses
earned) multiplied by the number of years of credited service up to a
maximum of 60%. Benefits otherwise payable under the unfunded
Supplemental Retirement Benefits Plan are reduced by amounts payable
under the Retirement Plan and the ERISA Excess Benefits Plan.
The following table shows the maximum aggregate annual retirement
benefit payable from all three plans at normal retirement age for
various levels of final average compensation and years of service,
assuming payment of benefits in the form of a life annuity with a two
year certain:
Years of Service
Remuneration 10 Years 20 Years 30 Years 40 years
$ 50,000 $10,000 $20,000 $30,000 $30,000
100,000 20,000 40,000 60,000 60,000
150,000 30,000 60,000 90,000 90,000
200,000 40,000 80,000 120,000 120,000
250,000 50,000 100,000 150,000 150,000
300,000 60,000 120,000 180,000 180,000
350,000 70,000 140,000 210,000 210,000
400,000 80,000 160,000 240,000 240,000
450,000 90,000 180,000 270,000 270,000
Average annual compensation utilized for formula purposes includes
salary and bonus as reported on the Summary Compensation Table. The
benefit amounts shown in the preceding table are not subject to any
deduction for Social Security benefits or other offset amounts. The
number of years of service now credited under the Retirement Plan for
the participants listed in the "Summary Compensation Table" is as
follows: John Kean, Jr., 11 years; Robert P. Kenney, 27 years; Frank
T. Bahniuk, 18 years; and David P. Vincent, 10 years.
City Gas Company of Florida Pension Plan. The non-bargaining unit
employees of City Gas Company of Florida ("CGF") are eligible to
participate in the CGF Plan which, generally, is the plan that was in
effect when CGF was acquired in 1988. The CGF Plan provides that a
participant retiring at or after age 65 will receive an annual
retirement benefit equal in amount (when calculated as a life annuity)
to 1-1/4% of the participant's final average compensation (the average
of the highest sixty consecutive months' payroll compensation in the
last ten years of the participant's service as reported on Internal
Revenue Service Form W-2) multiplied by the number of years of
credited service. Benefits payable to participants in the CGF Plan may
be reduced by reason of the limitations imposed under Section 415 of
the Code.
The following table shows the maximum aggregate annual retirement
benefit payable at normal retirement age for various levels of final
average compensation and years of service under the CGF Plan, assuming
the payment of benefits as a life annuity with two years certain:
Years of Service
Remuneration 10 Years 20 Years 30 Years 40 years
$ 50,000 $ 6,250 $12,500 $18,750 $25,000
100,000 12,500 25,000 37,500 50,000
150,000 18,750 37,500 56,250 75,000
200,000 18,750 37,500 56,250 75,000
Average annual compensation utilized for formula purposes includes
salary, bonus, the value of restricted stock grants and payments for
unused vacation as reduced by reason of the limitations imposed under
Section 415 of the Code. The benefit amounts shown in the preceding
table are not subject to deduction for Social Security benefits or
other offset amounts. Lyle C. Motley, Jr. became a participant in the
CGF Plan effective January 1, 1996 and has one year of credited
service under the CGF Plan. Prior thereto, he had been a participant
in the Pennsylvania and Southern Gas Company Retirement Plan,
discussed below.
Pennsylvania and Southern Gas Company Employees Retirement Plan.
All employees of Pennsylvania and Southern Gas Company (P&S) are
eligible to participate in the P&S Retirement Plan which, generally,
is the plan that was in effect when P&S was acquired in 1994. The P&S
Plan, which is funded entirely by the Company, provides that a
participant retiring at or after age 65 will receive an annual
retirement benefit equal in amount to 1% of final average compensation
(the average of the highest sixty consecutive months' payroll
compensation during the last ten years of the participant's service)
plus 1.55% of the participant's final average compensation in excess
of 50% of Covered Compensation (defined by the Social Security
Administration for someone reaching Social Security normal retirement
age in the year of termination) multiplied by the number of years of
credited service up to a maximum of thirty-five years. Benefits
payable to participants in the P&S Plan may be reduced by reason of
the limitations imposed under Section 415 of the Code.
The following table shows the maximum aggregate annual retirement
benefit payable at normal retirement age for various levels of final
average compensation and years of service:
Years of Service
Remuneration 10 Years 20 Years 30 Years 40 years
$ 50,000 $ 7,100 $14,150 $21,250 $24,800
100,000 14,850 29,650 44,500 51,900
150,000 22,600 45,150 67,750 79,050
200,000 22,600 45,150 67,750 79,050
Final annual compensation utilized for formula purposes includes
salary and bonus payments as reduced by reason of the limitations
imposed under Section 415 of the Internal Revenue Code, which limit
the participant's annual average compensation for formula purposes to
$150,000. Lyle C. Motley, Jr. has 14 years of credited service under
the P&S Plan; his average compensation for purposes of the Plan is
$91,648.
Change in Control Agreements
The Company is party to Change in Control Agreements with certain
officers, including those officers listed in the Summary Compensation
Table (with the exception of Robert P. Kenney). The purpose of these
Agreements is to provide key management personnel with certain
financial protection in the event of a change in control of the
Company and the subsequent termination of the officer's employment. By
providing this protection, the Company helps to ensure that the
efforts of key employees remain focused on the Company's performance
and the enhancement of shareholder value during rumored, potential or
actual change in control situations.
A covered officer becomes entitled to the payments and benefits
provided for in the Agreement if, within thirty-six months after the
change in control, the Company (or its successor) terminates the
employee other than for cause or as a result of the employee's death
or disability or the employee terminates his or her employment for
Good Reason (as defined in the Agreement). Under the Agreement, the
payments to which a covered officer will be entitled in such a
termination event include a payment not to exceed three times the
officer's annual base salary plus three times the highest incentive
compensation award received by the officer during the preceding
thirty six months. In addition, the Agreements provide that following
termination of employment the officer will continue to participate in
all employee benefit plans in which the officer was eligible to
participate on the date of termination; all incentive awards not yet
paid will be payable; and the spread between the exercise price and
the higher of the highest bid price during the twelve months preceding
termination or the highest price per share paid in connection with any
change in control will be payable in cash in lieu of stock issuable
upon the exercise of stock options. All Change in Control Agreements,
with the exception of the Agreement with John Kean, Jr., provide that
in the event that any payment or benefit received under the Agreement
would be an "excess parachute payment" (within the meaning of
Section 280G(b)(1) of the Internal Revenue Code of 1986, as amended
from time to time), then the present value of all payments to be
received under the Agreement shall be reduced to an amount which
maximizes payments but does not result in the payment of an excess
parachute payment. The Agreement with John Kean, Jr. provides that if
any payments are subject to the excise tax imposed by Section 4999 of
the Internal Revenue Code as a result of an excess parachute payment,
then the Company (or its successor) shall gross-up the payments to be
made to him so that the net amount shall be equal to the payments
prior to the payment of any excise tax and any income taxes on the
gross-up payment.
Except as set forth above, the Company is not party to any other
employment, change in control or termination agreements with executive
officers.
OTHER BUSINESS
The Board of Directors does not intend to present any other
business at the Annual Meeting, and is not aware of any business to be
presented by others. However, if other matters are properly presented
for a vote, the proxies will be voted upon such matters in accordance
with the judgment of the persons acting under the proxy.
ANNUAL REPORT
The Annual Report of the Company for the fiscal year ended
September 30, 1996 has previously been mailed to shareholders, who are
referred to such report for financial and other information about the
Company.
The Company will furnish without charge a copy of its most recent
Annual Report on Form 10-K as filed with the Securities and Exchange
Commission to any beneficial owner of the Company's Common Stock upon
receipt of a written request from such person. Please direct all such
requests to James R. Van Horn, General Counsel and Secretary, 550
Route 202 206, P.O. Box 760, Bedminster, New Jersey 07921-0760.
SHAREHOLDER PROPOSALS
Shareholders are entitled to submit proposals for consideration at
the Company's 1998 Annual Meeting. Shareholders who desire to submit a
proposal to be considered for inclusion in the Proxy Statement
relating to that meeting must satisfy certain informational and stock
ownership requirements established by the Securities and Exchange
Commission and submit such proposal to the Secretary of the Company at
550 Route 202 206, P.O. Box 760, Bedminster, New Jersey 07921-0760 no
later than October 5, 1997.
By Order of the Board of Directors
JAMES R. VAN HORN
General Counsel and Secretary
Dated: February 3, 1997
Bedminster, New Jersey
Back Page
(DIRECTIONS TO MEETING LOCATION)
Proxy Card
(Logo)
NUI Corporation
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints John Kean, John Kean, Jr. and James R.
Van Horn, or any one of them, each with full power of substitution,
attorneys, agents and proxies to vote on behalf of the undersigned at
the Annual Meeting of Shareholders of NUI Corporation to be held at
10:30 a.m. on March 11, 1997, or at any adjournment thereof.
This proxy, when properly executed, will be voted in the manner
directed herein by the undersigned shareholder(s). If no direction is
given, this proxy will be voted FOR with respect to items 1 and 2.
(Continued, and to be marked, dated and signed, on the other side)
Whether or not you expect to attend the meeting you are requested to
date and sign this proxy and mail it promptly in the enclosed
envelope.
SEE REVERSE
SIDE
Fold and Detach Here
Reverse Side of Proxy Card
Please mark your
votes as in this
example.
1. Election of Directors
WITHHELD
FOR FOR ALL
Nominees:
James J. Forese
R. Van Whisnand
WITHHELD FOR: (Write that nominee's name in the space provided below).
____________________________
2. Ratification of the appointment of Arthur Andersen LLP, as the
Company's independent public accountants.
FOR AGAINST ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon such
other business as may properly come before the meeting.
Please mark this box if
you plan to attend the
Annual Meeting in person ------
Please sign exactly as name appears
hereon. When shares are held by
joint tenants, both should sign.
When signing as an attorney,
executor, administrator, trustee,
or guardian, please give full title
as such. If a corporation, or
limited liability company, please sign
in full corporate name by President
or other authorized officer. If a
partnership, please sign in
partnership name by authorized person.
PLEASE MARK, SIGN, DATE AND RETURN
THIS PROXY CARD PROMPTLY USING THE
ENCLOSED PREPAID ENVELOPE.
---------------------------
---------------------------
SIGNATURE(S) DATE
