Jeffry M. Householder
CHESAPEAKE UTILITIESAbout Jeffry M. Householder
Jeffry M. Householder is Chair of the Board, President and Chief Executive Officer of Chesapeake Utilities Corporation (CPK). He has served as CEO since January 1, 2019 and as Board Chair since May 3, 2023; he is a Class II director up for re-election in 2025 and is age 67 . Under his leadership, CPK completed the acquisition of Florida City Gas in 2023, the largest in the company’s history, more than doubling the customer base and natural gas infrastructure in Florida . The board currently combines the Chair/CEO roles with an independent Lead Director to mitigate independence concerns .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Florida Public Utilities Company (CPK subsidiary) | President | 2010–2018 | Led FPUC; CPK later expanded Florida footprint with Florida City Gas acquisition in 2023 . |
| TECO Energy Peoples Gas; West Florida Gas; Florida City Gas; Tallahassee Utilities | Leadership roles | Not disclosed | >40 years of energy industry operating and regulatory experience . |
External Roles
| Organization | Role | Years |
|---|---|---|
| American Gas Association | Board member | As disclosed in 2024/2025 proxies |
| Edison Electric Institute | Board member | As disclosed in 2024/2025 proxies |
| Southern Gas Association | Board member | As disclosed in 2024/2025 proxies |
| Delaware Business Roundtable | Member; Executive Committee | As of 2024 proxy (Exec Committee) |
Board Service (governance and dual-role implications)
- Director since 2019; Chair of the Board since May 3, 2023; also serves as Chair of the Board’s Investment Committee (no additional director pay as an employee) .
- The board has an independent Lead Director structure to counterbalance the combined Chair/CEO role; executive sessions procedures ensure independent director forums if a non-independent director is present .
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | 747,000 | 778,680 | 834,060 |
| Bonus ($) | — | 150,000 (discretionary, FCG acquisition) | — |
| All Other Compensation ($) | 266,492 | 36,119 | 114,687 |
| Total Compensation ($) | 2,843,149 | 3,269,505 | 4,154,015 |
Notes:
- 2024 CEO annual cash incentive target was 100% of base salary (set using peer and industry data reviewed by FW Cook) .
Performance Compensation
Annual Cash Incentive (2024 design and payout)
- 2024 performance period: Jan 1–Dec 31, 2024. Financial metric centered on an EPS target of $5.35 (banded around external guidance); weighting 80% financial (EPS) / 20% non-financial objectives. Payout range 0–200% of target; actual CEO payout approved Feb 2025 .
- CEO target opportunity: 100% of $850,000 base salary at 4/1/2024; payout achieved ~139% of target .
| Element | Target/Payout | Details |
|---|---|---|
| Base Salary at 4/1/2024 | $850,000 | Used for incentive target calculation |
| Target % of Base | 100% | CEO target opportunity |
| Weighting | 80% Financial / 20% Non-Financial | EPS-driven (financial) + individual goals (non-financial) |
| Financial Payout ($) | 867,000 | Reflects financial achievement |
| Non-Financial Payout ($) | 312,120 | Reflects individual/organizational imperatives |
| Total Cash Incentive Paid ($) | 1,179,120 | Authorized Feb 2025 |
Long-Term Equity Incentive (structure and grants)
- Performance Share design includes Growth in Long-Term Earnings and ROE components (0–200% payout), with a TSR modifier of +/-20% applied to total achievement for the 2024–2026 performance cycle .
- Valuation uses grant date closing price for performance components and Monte Carlo simulation for market-based TSR .
| Grant/Period | Grant Date | Equity Vehicles | Target/Max Shares | Grant Date Fair Value | Valuation/Expectations |
|---|---|---|---|---|---|
| 2024–2026 PSU | 2/20/2024 | PSUs (Growth in Long-Term Earnings; ROE) + TSR modifier (+/-20%) | Target: 17,495; Max: 34,990; Threshold: 8,748 | $2,026,148 | Performance components recorded at fair value per share $105.21; TSR modeled with Monte Carlo, estimated TSR percentile 58%, fair value per share $106.03 |
| 2023–2025 PSU | 2/22/2023 | Similar structure | Not disclosed here | — | Estimated payout assumptions at grant: performance components 100%; TSR percentile 53%; TSR fair value/share $142.38 |
| 2022–2024 PSU | 2/23/2022 | Similar structure | Not disclosed here | — | Estimated payout assumptions at grant: performance components 100%; TSR percentile 44%; TSR fair value/share $108.96 |
If maximum awards were achieved, the CEO award values would be $3,681,298 (2024–2026), $3,329,585 (2023–2025), and $2,418,706 (2022–2024) as disclosed in the proxy .
Equity Ownership & Alignment
Beneficial Ownership and Pledging/Hedging
- Shares beneficially owned (management/board tables):
• 76,236 shares as of the 2025 proxy’s ownership table for management/directors .
• 64,951 shares and “less than 1%” of class as of March 11, 2024 . - No pledging: Company policy prohibits hedging and pledging; the 2024 proxy also states no director or NEO had pledged shares .
| Ownership Metric | 2024 | 2025 |
|---|---|---|
| Beneficially Owned Shares | 64,951 (as of Mar 11, 2024) | 76,236 (ownership table in 2025 proxy) |
| % of Shares Outstanding | <1% | Not shown; group total 1.51% |
| Pledged | None (policy prohibits; no pledges disclosed) | Policy prohibits; none disclosed |
Ownership Guidelines and Compliance Signals
- CEO stock ownership guideline: 5x base salary; other NEOs: 3x; administered by Corporate Governance Committee .
- Anti-hedging and anti-pledging policy applies to directors, officers, employees, and related persons .
Deferred/Non-Qualified Deferrals (NQDC) – 2024
| Item | Amount ($) |
|---|---|
| Executive Deferrals (2024) | 238,196 |
| Company Contributions (2024) | 81,392 |
| Aggregate Earnings (2024) | 848,590 |
| Withdrawals/Distributions (2024) | (6,620) |
| Aggregate Balance at 12/31/2024 | 5,737,615 |
| Amount also in SCT (current/prior years) | 319,588 / 3,147,138 |
Employment Terms
- Employment Agreements: Original terms through Dec 31, 2021, renewed Dec 16, 2021 through Dec 31, 2022, with automatic one-year renewals thereafter unless notice; amended Oct 2, 2023 to align with SEC/NYSE clawback rules (17 C.F.R. §240.10D; NYSE 303A.14) .
- Good Reason (summary): changes in title/office, failure to nominate to the Board (if applicable), significant adverse changes to scope/authority/compensation, material breach not cured; mergers/transfers require successor assumption of obligations .
- Change-in-Control (CIC) treatment: Unvested performance shares immediately earned at target levels for 2024 and 2023 equity incentive awards; continuation of health and insurance benefits per agreement .
CIC Economics (Hypothetical as of 12/31/2024; stock price $121.35)
| Component | Amount ($) |
|---|---|
| Base Salary (severance-multiple based) | 2,550,000 |
| Cash Incentive (average of 2021–2023 x multiple) | 2,157,627 |
| Healthcare/Insurance Benefits | 56,864 |
| Unpaid Equity Incentive Compensation | 3,686,249 |
| Total Gross Severance Potential | 8,450,740 |
| Net Amount Payable (after applicable adjustments) | 5,821,715 |
Clawback
- Agreements amended Oct 2, 2023 to reflect SEC Rule 10D and NYSE Section 303A.14 clawback requirements .
Related Party and Trading Policies
- No related person transactions >$120,000 for the period Jan 1, 2023–Mar 11, 2024 .
- Hedging and pledging of CPK securities prohibited for directors, executives, employees, and related persons .
Compensation Structure Analysis (pay-for-performance)
- Mix and direction: 2024 total comp rose to $4.15M, with significant performance-based pay: $2.03M in stock awards and $1.18M in cash incentive; bonus eliminated versus 2023 discretionary transaction bonus .
- Annual incentive rigor: EPS target centered at $5.35 (aligned with public guidance), 80% weight on financials; payout ~139% of target indicates outperformance versus targets and strategic goal attainment .
- LTI design: Multi-metric PSUs (earnings growth and ROE) with TSR modifier promote balanced operating and market alignment; Monte Carlo TSR assumptions for 2024–2026 were at the 58th percentile at grant .
- Governance and alignment: 5x salary CEO ownership guideline; anti-hedging/pledging; no director fees for dual-role CEO/Chair; use of FW Cook market analysis with compensation near market median .
Director Compensation (context for dual roles)
- As an employee director and Board Chair, Mr. Householder receives no additional director or Chair compensation; non-employee directors receive cash retainers and equity awards (fully vested) under the 2023 Stock and Incentive Plan .
Investment Implications
- Pay-performance alignment is strong: 2024 cash incentive anchored to EPS guidance and paid ~139% of target; PSU design uses multi-year earnings/ROE plus TSR modifier, indicating robust alignment with sustainable performance and shareholder returns .
- Retention and potential selling pressure: Large ongoing PSU cycles (2023–2025 and 2024–2026) and a substantial NQDC balance of $5.74M support retention; anti-hedging/pledging policies reduce forced-sale risk; beneficial ownership increased from 64,951 to 76,236 shares YoY in proxy tables .
- CIC risk/reward: CIC economics are meaningful (gross ~$8.45M; net ~$5.82M) and include target-level acceleration of performance shares, which can be accretive in a transaction but may dilute if widely triggered across NEOs .
- Governance: Combined Chair/CEO structure is mitigated by an independent Lead Director and formal executive session protocols; he also chairs the Investment Committee as a management director, a structure investors should monitor for capital allocation oversight balance .