Filed by Bowne Pure Compliance



 




Exhibit 10.8




UGI CORPORATION

EXECUTIVE ANNUAL BONUS PLAN

(Effective as of October 1, 2006)




I. Purpose. The purpose of the UGI Corporation Executive Annual Bonus Plan (the “Plan”) is
to provide a means whereby UGI Corporation (the “Company”) may provide incentive compensation to
its eligible employees to serve as an incentive for employee performance and retention. The Plan is
intended to encourage eligible employees to contribute to the growth of the Company and the
enhancement of shareholder value. The Plan is part of a total compensation structure under which a
meaningful portion of eligible employees’ total compensation is based on achievement of performance
goals relating to the eligible employees’ business and/or area of responsibility. The Plan is
effective as of October 1, 2006.



II. Definitions. Whenever used in this Plan, the following terms will have the respective meanings
set forth below:



2.1 “Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 of the General
Rules and Regulations under the Securities Exchange Act of 1934, as amended.




2.2 “Board” means the board of directors of the Company as constituted from time to time.




2.3 “Code” means the Internal Revenue Code of 1986, as amended.



2.4 “Committee” means (i) for Senior Management, the Compensation and Management Development
Committee of the Board or its successor and (ii) for eligible employees who are not members of
Senior Management, the Chief Executive Officer of the Company or his designee.




2.5 “Company” means UGI Corporation, a Pennsylvania corporation, or any successor thereto.




2.6 “Employer” means the Company and its Subsidiaries.



2.7 “Participant” means an eligible employee or other individual who provides services to the
Company or its Subsidiaries and who is described in Section III as a participant in the Plan.
Employees of UGI Utilities, Inc. and AmeriGas Propane, Inc. and their subsidiaries are not eligible
to participate in the Plan.



2.8 “Plan” means this UGI Corporation Executive Annual Bonus Plan, as in effect from time to
time.



2.9 “Senior Management” means those employees who are designated as executive officers by the
Board pursuant to Rule 16a-1 of the rules promulgated pursuant to the Securities Exchange Act of
1934, as amended.


 


 









 





2.10 “Subsidiary” means any corporation or partnership, at least 20% of the outstanding voting
stock, voting power or partnership interest of which is owned, directly or indirectly, by the
Company.



III. Participation. All salaried employees of the Company and its Subsidiaries (other than
UGI Utilities, Inc., AmeriGas Propane, Inc. and their subsidiaries) in grade level 70 or above
shall be eligible to participate in the Plan for each fiscal year. The Company’s fiscal year
begins on October 1. The Committee may also designate in writing that one or more senior level
directors or employees of a Subsidiary shall be Participants in the Plan for a fiscal year, in its
sole discretion.



IV. Annual Bonus.



4.1 Target Bonus. At the beginning of each fiscal year, the Committee shall establish target
bonuses as a percentage of each Participant’s salary for the fiscal year. Each Participant shall
be eligible to receive an annual bonus for the fiscal year based on the achievement of
business/financial performance goals, and the Participant’s individual performance goals, if
applicable, during the fiscal year. The amount actually paid to a Participant may be more or less
than the target bonus amount, depending on the extent to which the performance goals are satisfied.




4.2 Performance Goals.



(a) Business/Financial Goals. At the beginning of each fiscal year, the Committee
shall establish the business/financial performance goals for the fiscal year and leverage tables
that apply to the performance goals.



(b) Individual Goals. The Committee shall determine which Participants shall have
individual performance goals as part of their bonus calculation. At the beginning of each fiscal
year, the Committee shall establish each Participant’s individual performance goals for the year,
if applicable, and shall set leverage tables that will apply to individual performance goals. The
portion of the target bonus attributable to individual performance will be payable only if the
business/financial performance goals are achieved at the threshold level of performance.



(c) Weighting. At the time the Committee establishes performance goals for each fiscal
year, the Committee will determine the weighting for each Participant with respect to the
business/financial goals and the individual goals. The weighting of the two types of goals need
not be uniform as to all Participants.



(d) Communication of Goals. The Committee shall provide for the communication of the
performance goals and corresponding leverage tables to the Participants.




4.3 Determination and Approval of Bonus Payments.



(a) At the end of the fiscal year, the Committee shall determine the amount of each
Participant’s bonus, if any, based on the achievement of the business/financial performance goals
and, if applicable, the achievement of the individual performance goals. The Committee
shall have sole discretion to determine whether and to what extent the performance goals have
been met. The Committee may adjust the performance results for extraordinary items or other
events, as the Committee deems appropriate.


 


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(b) If the threshold level of business/financial performance is not achieved, no bonuses will
be paid.



(c) With respect to Participants whose annual bonus under the Plan is based solely on the
achievement of business/financial performance goals, the Committee shall have discretion to
increase or decrease the amount of the annual bonus by 50% more or less than the amount otherwise
determined, based on the Participant’s contribution to the achievement of the business/financial
performance goals, other contributions that have a significant impact on Company performance, or
other factors.



4.4 Newly Hired Employees, Promotions and Transfers. Employees who are newly hired or who are
promoted or transferred into a position eligible to participate in the Plan during the fiscal year
may be eligible to receive a prorated bonus award calculated in whole months based on the relative
time spent in the eligible position during the fiscal year, as determined by the Committee. If a
Participant is transferred to an Affiliate of the Company (or into a position with a different
annual bonus target percentage) during the fiscal year, the Participant’s performance goals may be
adjusted to reflect the change in Employer or position. If a Participant is transferred into a
position that is not eligible to participate in the Plan during the fiscal year, the Participant
may be eligible to receive a prorated award calculated in whole months based on the relative time
spent in the eligible position during the fiscal year, as determined by the Committee.



4.5 Payment of Annual Bonus. Each annual bonus for a fiscal year shall be paid in cash to the
Participant in a single lump sum payment between September 30 and December 31 of the calendar year
in which the fiscal year ends, except as provided below.



4.6 Withholding Tax. Each Employer shall withhold from each bonus payment an amount
sufficient to satisfy all federal, state and local tax withholding requirements relating to the
bonus.



V. Termination of Employment. Except as provided below, a Participant must be employed by
the Employer on the last day of the fiscal year for which the bonus is earned in order to receive a
bonus for the year. If a Participant’s employment terminates on account of retirement, death or
disability, as determined by the Committee, the Committee may determine in its sole discretion that
a pro rata portion of the Participant’s target annual award will be paid, calculated in whole
months based on the relative time spent in the eligible position during the fiscal year. The
bonus, if any, shall be paid within 90 days following the Participant’s termination of employment
on account of retirement, death or disability.



VI. Administration. The Committee administers the Plan. The Committee shall have full
power and discretionary authority to interpret and administer the Plan, to make all determinations,
including all participation and bonus determinations, and to prescribe, amend and rescind any
rules, forms or procedures as the Committee deems necessary or appropriate for
the proper administration of the Plan and to make any other determinations and take such other
actions as the Committee deems necessary or advisable in carrying out its duties under the Plan.
Any action required of the Committee under the Plan shall be made in the Committee’s sole
discretion and not in a fiduciary capacity. All decisions and determinations by the Committee
shall be final, conclusive and binding on the Company, the Participants, and any other persons
having or claiming an interest hereunder. All bonuses shall be awarded conditional upon the
Participant’s acknowledgement, by continuing in employment with the Employer, that all decisions
and determinations of the Committee shall be final and binding on the Participant, his or her
beneficiaries and any other person having or claiming an interest in such bonus.


 


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VII. General Provisions.



7.1 Transferability. No bonus under this Plan shall be transferred, assigned, pledged or
encumbered by the Participant nor shall it be subject to any claim of any creditor, and, in
particular, to the fullest extent permitted by law, all such payments, benefits and rights shall be
free from attachment, garnishment, trustee’s process, or any other legal or equitable process
available to any creditor of such Participant. In the event of a Participant’s death, any amounts
payable under this Plan, as determined by the Committee, shall be paid to the Participant’s estate.



7.2 Unfunded Arrangement. The Plan is an unfunded incentive compensation arrangement.
Nothing contained in the Plan, and no action taken pursuant to the Plan, shall create or be
construed to create a trust of any kind. Each Participant’s right to receive a bonus shall be no
greater than the right of an unsecured general creditor of the Employer. All bonuses shall be paid
from the general funds of the Employer, and no special or separate fund shall be established and no
segregation of assets shall be made to assure payment of bonuses.



7.3 No Rights to Employment. Nothing in the Plan, and no action taken pursuant hereto, shall
confer upon a Participant the right to continue in the employ of the Employer, or affect the right
of the Employer to terminate a Participant’s employment at any time for cause or for no cause
whatsoever.



7.4 Section 409A. The Plan is intended to comply with the short-term deferral rule set forth
in the regulations under section 409A of the Code, in order to avoid application of section 409A to
the Plan. If and to the extent that any payment under this Plan is deemed to be deferred
compensation subject to the requirements of section 409A, this Plan shall be administered so that
such payments are made in accordance with the requirements of section 409A.



7.5 Termination and Amendment of the Plan. The Compensation and Management Development
Committee may amend or terminate the Plan at any time.



7.6 Successors. The Plan shall be binding upon and inure to the benefit of the Company, its
successors and assigns, and each Participant and his or her heirs, executors, administrators and
legal representatives.



7.7 Applicable Law. The Plan shall be construed and governed in accordance with the laws of
the Commonwealth of Pennsylvania.




 


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