Al Swanson
PLAINS GP HOLDINGSAbout Al Swanson
Executive Vice President and Chief Financial Officer of PAGP GP/GP LLC since February 2011; age 61. Prior roles include Senior VP & CFO (Nov 2008–Feb 2011), Senior VP–Finance, Treasurer, and multiple finance/treasury positions at Plains since 2001, preceded by Santa Fe Snyder (Treasurer), Snyder Oil (corporate finance/controller/accounting) and Apache (audit/accounting) . 2024 performance drivers tied to PAA results: Adjusted EBITDA attributable to PAA was $2.779B vs $2.675B goal, and implied DCF/CUE was $2.49 vs $2.44 target . Over 2020–2024, PAA’s cumulative TSR (initial $100 basis) reached $137.87 in 2024 vs peer group $212.45; net income was $1.11B and Adjusted EBITDA $2.78B in 2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Plains GP Holdings/Plains All American (GP LLC) | EVP & CFO | Feb 2011–present | Led finance strategy, liquidity, and capital allocation; driver of focus on free cash flow, leverage targets, debt market access and ratings upgrade . |
| Plains GP Holdings/GP LLC | SVP & CFO | Nov 2008–Feb 2011 | Established finance governance and reporting cadence post-2008; treasury oversight . |
| Plains GP Holdings/GP LLC | SVP–Finance; SVP–Finance & Treasurer | Aug 2008–Nov 2008; Aug 2007–Aug 2008 | Finance leadership and treasury integration . |
| Plains GP Holdings/GP LLC | VP–Finance & Treasurer; VP & Treasurer; Treasurer | Aug 2005–Aug 2007; Feb 2004–Aug 2005; May 2001–Feb 2004 | Built capital markets and liquidity frameworks; corporate treasury management . |
| Plains Resources | Director of Treasury; Treasurer | Nov 2000–May 2001; Feb 2001–May 2001 | Corporate treasury standing up processes . |
| Santa Fe Snyder | Treasurer | 1999–Oct 2000 | Corporate treasury . |
| Snyder Oil | Director Corporate Finance; Controller SOCO Offshore; Accounting Manager | 1992–1999 (roles in 1997–1998 highlighted) | Corporate finance, controller, accounting leadership . |
| Apache Corporation | Internal audit & accounting | 1986–1992 | Audit/accounting foundation . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| None disclosed in proxy | — | — | — . |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $512,500 | $550,000 | $550,000 |
| Target Bonus (% of Base) | 150% | 150% | 150% |
| Other Compensation ($) | $19,140 | $20,640 | $21,540 |
Notes:
- CEO base was adjusted in 2024; Swanson’s base unchanged in 2024 per CD&A .
- “Other Compensation” reflects 401(k) cash match ($20,700 in 2024) and group life premiums .
Performance Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Annual Bonus Paid ($) | $1,450,000 | $1,180,000 | $1,150,000 |
| Stock Awards (Grant Date Fair Value, $) | $1,237,005 | $1,153,018 | $1,406,160 |
2024 Annual Bonus Framework and Outcomes (Al Swanson):
| Metric | Weight | Target | Actual 2024 | Payout % | Notes/Vesting |
|---|---|---|---|---|---|
| Adjusted EBITDA attributable to PAA | 40% | $2.675B | $2.779B | 152% | Linear payout 92.5%–110%; company score component . |
| Implied DCF per CUE | 40% | $2.44 | $2.49 | 127% | Linear payout 92.5%–110% . |
| Safety (TRIR) | 10% | 0.25 | 0.25 | 75% (after −25 bps) | Discretionary -25 bps for fatalities . |
| Environmental (FRR) | 10% | 15 | 19 | 89% (after +25 bps) | +25 bps due to lower release volumes vs 5‑yr avg . |
| Company Performance Subtotal | — | — | — | 128% | Weighted sum . |
| Individual Performance | 40% | — | — | 155% | Finance leadership, FCF focus, leverage/capital strategy, debt market access, ratings upgrade . |
| Percent of Target Bonus Earned | — | — | — | 139% | Formulaic result combining company and individual . |
| 2024 Actual Bonus ($) | — | $825,000 | — | — | Paid $1,150,000 . |
2024 LTIP Structure (Al Swanson):
- Target increased to 350% of base; 2024 LTIP award $1,925,000; 108,000 phantom units at VWAP $17.82, split 54,000 time-based and 54,000 performance-based .
- Vesting on August 2027 distribution date; Performance portion pays 0–200% based on (i) relative TSR vs peer group with negative TSR modifier, and (ii) cumulative DCF/CUE target $7.75 with leverage ratio modifier .
- DERs accrue: time-based paid first year at Aug 2025 then quarterly; performance-based DERs accrue and pay at Aug 2027 only on vested units .
Equity Ownership & Alignment
| Ownership Metric | Value |
|---|---|
| Class A shares beneficially owned | 1,351,839 (less than 1% of Class A) |
| PAA units/Series A preferred (via Class C “look-through”) | 494,714 (less than 1% of Class C) |
| Stock ownership guideline | EVP required to hold ≥3× base salary; “hold until met” requirement; compliance date Nov 2025; current execs on track/met . |
| Hedging/pledging | Prohibited; no pledges by directors/NEOs as of Mar 24, 2025 . |
| Options | None; company has not issued options to NEOs . |
| 2024 Units vested (from 2021 grants) | 167,378 units vested; value realized $2,853,795 (computed at $17.05 on Aug 13, 2024) . |
Outstanding Phantom Units (Unvested) at 12/31/2024:
| Grant Year | Time-Based Units (#) | Market Value ($) | Performance-Based Units (Target #) | Market/Payout Value ($) | Vesting Date |
|---|---|---|---|---|---|
| 2022 | 69,300 | $1,183,644 | 69,300 | $1,183,644 | Aug 2025 |
| 2023 | 51,075 | $872,361 | 51,075 | $872,361 | Aug 2026 |
| 2024 | 54,000 | $922,320 | 54,000 | $922,320 | Aug 2027 |
Performance grant specifics:
- 2022 perf tranche: TSR vs peer; cumulative DCF/CUE $7.05; estimated payout at 12/31/2024 ~167% TSR and ~143% DCF/CUE; levered modifier; DERs accrue and pay Aug 2025 .
- 2023 perf tranche: TSR vs peer; cumulative DCF/CUE $7.45; levered modifier; DERs accrue and pay Aug 2026 .
- 2024 perf tranche: TSR vs peer; cumulative DCF/CUE $7.75; levered modifier; DERs accrue and pay Aug 2027 .
Employment Terms
| Scenario (as if on 12/31/2024) | Potential Payment Type | Amount ($) | Key Terms |
|---|---|---|---|
| Death | Equity acceleration (phantom units) | $4,112,010 | Death/disability after ≥1 year from grant → all outstanding phantom units under 2022/2023 grants vest at next distribution; 2024 grants forfeited if within first year . |
| Disability | Equity acceleration (phantom units) | $4,112,010 | Same vesting mechanics as death . |
| Termination without cause | Equity acceleration (pro rata) | $2,678,682 | After first anniversary of grant → pro rata vest (assuming target for performance units) at next distribution; 2019 awards (not applicable to Swanson) had distinct schedules . |
| Change in status (CoC protected period or approved retirement) | Equity acceleration (full) | $5,956,650 | Double-trigger: termination without cause or good reason within protected period around change of control; or retirement approved by CEO/Board → full vest at next distribution . |
Additional terms:
- “Change in status” includes termination without cause during protected period, “good reason” reductions, or approved retirement; “change of control” defined across GP/PAGP/PAA control transfers or asset transfers .
- Confidentiality/non-solicit terms are disclosed for certain executives (Chiang, Pefanis, McGee, Chandler); no specific non-compete/non-solicit terms for Swanson disclosed in the proxy .
Compensation Committee Analysis
- Committee members: John T. Raymond (chair; transitions to member June 1, 2025), Gary R. Petersen, Bobby S. Shackouls (becomes chair June 1, 2025); all independent per Nasdaq/SEC standards .
- Independent consultant: Meridian Compensation Partners engaged since 2019; 2024 study found Swanson’s and non-CEO NEO target comp generally competitive; CEO below peer median; TSR comparator and compensation peer groups defined (midstream peers and AMNA/SPX indices) .
- Program features: >80% NEO target compensation variable/at risk; 100% formulaic annual bonus; 50% of LTIP performance-based over 3 years; clawback policy per Nasdaq/Dodd‑Frank; anti‑hedging/pledging; no excise tax gross‑ups; no option repricing; no significant perquisites .
Say‑on‑Pay & Shareholder Feedback
- ~98% approval on say‑on‑pay at 2024 annual meeting; average approval ~98% over last four years; ongoing investor engagement (“feedback loop”) informs program design; 2024 program unchanged vs 2023 .
Performance Compensation Details (LTIP Mechanics and 2021 Vesting Outcome)
- 2021 LTIP vesting (Aug 2024): 50% time-based; 50% performance-based split equally between TSR and DCF/CUE; TSR payout 157%, DCF/CUE payout 200%; overall payout 139% of target; Swanson vested 167,378 units valued at $2,853,795 (at $17.05) .
- DERs: Time-based pay first-year lump sum then quarterly until vest; performance-based accrue and pay lump sum on vest for vested units .
Equity Compensation Plan and Governance
- PAGP Long Term Incentive Plan authorizes up to 3,755,208 Class A shares; 144,500 unvested phantom Class A shares outstanding at 12/31/2024; plan prohibits option repricing/backdating and includes change‑of‑control vesting if specifically provided in award agreements .
- PAA reimburses GP for director/officer comp and related governance expenses per Omnibus Agreement (PAA paid $4.3M such expenses in 2024) .
Investment Implications
- High alignment via substantial at‑risk pay and multi‑year performance metrics (Adjusted EBITDA, DCF/CUE, relative TSR); Swanson’s 2024 bonus paid at 139% of target driven by exceeding financial targets and finance execution, reinforcing pay‑for‑performance .
- Material upcoming vesting events (Aug 2025/2026/2027) and DER cash flows could create timing windows for insider liquidity; however, “hold‑until‑met” ownership guidelines and anti‑hedging/pledging policies temper near‑term selling pressure until guidelines are satisfied .
- Retention risk mitigated by double‑trigger change‑in‑control and termination provisions that accelerate equity only upon qualifying events; no disclosed cash severance multiple for Swanson, making equity the primary retention lever .
- Governance signals positive: independent Compensation Committee with use of Meridian; strong say‑on‑pay support (~98%) suggests investor acceptance of pay mix and metrics, reducing headline compensation risk .