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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Valero Energy Corporation | NYSE:VLO | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-0.50 | -0.32% | 156.84 | 158.885 | 154.785 | 157.86 | 2,356,804 | 01:00:00 |
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to §240.14a-12
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No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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Title of each class of securities to which transaction applies: ____________________
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Aggregate number of securities to which transaction applies: ____________________
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Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined): _______
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Proposed maximum aggregate value of transaction: ____________________
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Total fee paid: ____________________
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Fee paid previously with preliminary materials.
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Check box if any part of the fee is offset as provided by Exchange Act Rule 240.0-11 and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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Amount Previously Paid: ____________________
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Form, Schedule or Registration Statement No.: ________
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Filing Party: ____________________
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Date Filed: ____________________
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1.
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Election of directors;
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2.
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Ratify KPMG LLP as independent auditors;
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3.
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Advisory vote to approve executive compensation;
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4.
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Advisory vote to recommend the frequency of stockholder votes on executive compensation; and
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5.
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Other matters, if any, properly brought before the meeting.
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TABLE OF CONTENTS
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ANNUAL MEETING OF STOCKHOLDERS
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PROPOSAL NO. 1—
ELECTION OF DIRECTORS
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VALERO’S 201
6 ACCOMPLISHMENTS
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Process and Timing of Compensation Decisions
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Benchmarking Competitive Pay Levels
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Relative Size of Major Compensation Elements
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Individual Performance and Personal Objectives
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Base Salaries
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Annual Incentive Bonus
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Long-Term Incentive Awards
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Perquisites and Other Benefits
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Post-Employment Benefits
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ACCOUNTING AND TAX TREATMENT
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TABLE OF CONTENTS
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PROPOSAL NO. 2
—RATIFY APPOINTMENT OF INDEPENDENT AUDITORS
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KPMG LLP FEES
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REPORT OF THE AUDIT COMMITTEE
FOR FISCAL YEAR 2016
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PROPOSAL NO. 3—
ADVISORY VOTE TO APPROVE COMPENSATION OF NAMED EXECUTIVE OFFICERS
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PROPOSAL NO. 4
—ADVISORY VOTE TO RECOMMEND THE FREQUENCY OF STOCKHOLDER VOTES ON EXECUTIVE COMPENSATION
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STOCKHOLDER COMMUNICATIONS
, NOMINATIONS, AND PROPOSALS
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Jerry D. Choate
(retired)
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Donald L. Nickles
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Stephen M. Waters
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H. Paulett Eberhart
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Philip J. Pfeiffer
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Randall J. Weisenburger
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Kimberly S. Greene
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Robert A. Profusek
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Rayford Wilkins, Jr.
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Deborah P. Majoras
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Susan Kaufman Purcell
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•
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is not a relationship that would preclude a determination of independence under Section 303A.02(b) of the NYSE Listed Company Manual;
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•
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consists of charitable contributions by Valero to an organization in which a director is an executive officer that do not exceed the greater of $1 million or two percent of the organization’s gross revenue in any of the last three years;
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•
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consists of charitable contributions to any organization with which a director, or any member of a director’s immediate family, is affiliated as an officer, director, or trustee pursuant to a matching gift program of Valero and made on terms applicable to employees and directors, or is in amounts that do not exceed $1 million per year; and
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•
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is not a relationship required to be disclosed by Valero under Item 404 of Regulation S-K (regarding related person transactions).
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Audit Committee,
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Compensation Committee, and
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Nominating/Governance and Public Policy Committee.
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Randall J. Weisenburger (Chair),
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H. Paulett Eberhart,
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Susan Kaufman Purcell, and
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Stephen M. Waters.
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Rayford Wilkins, Jr. (Chair),
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Philip J. Pfeiffer, and
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•
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Robert A. Profusek.
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to identify individuals qualified to become Board members, consistent with criteria approved by the Board;
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to select, or to recommend that the Board select, director nominees;
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to develop and recommend a set of corporate governance principles applicable to Valero;
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assist the Board in identifying, evaluating, and monitoring public policy trends and social and political issues that could impact our business activities and performance; and
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consider and make recommendations for our strategies relating to corporate responsibility, contributions, and reputation management.
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Deborah P. Majoras (Chair),
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Kimberly S. Greene, and
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Donald L. Nickles.
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applicable independence standards;
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skills and experience necessary for service on the Board’s committees; and
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skills and expertise to serve the needs of the Board as a whole.
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independence of thought and judgment;
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the ability to dedicate sufficient time, energy, and attention to the performance of duties, taking into consideration the candidate’s service on other public company boards; and
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skills and expertise complementary to those of the existing Board members; in this regard, the Board will consider its need for operational, managerial, financial, governmental affairs, or other expertise.
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diversity concepts such as race, gender, and national origin;
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the ability of a prospective candidate to work with the then-existing interpersonal dynamics of the Board; and
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the candidate’s ability to contribute to the collaborative culture among Board members.
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lead the Board in productive, strategic planning;
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determine necessary and appropriate agenda items for meetings of the Board with input from the Lead Director and Board committee chairs; and
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determine and manage the amount of time and information devoted to discussion of agenda items and other matters that may come before the Board.
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Directors
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Director Since
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Age as of 12/31/2016
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Joseph W. Gorder,
Chairman of the Board, President, and Chief Executive Officer
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2014
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59
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H. Paulett Eberhart
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2016
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63
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Kimberly S. Greene
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2016
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50
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Deborah P. Majoras
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2012
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53
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Donald L. Nickles
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2005
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68
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Philip J. Pfeiffer
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2012
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69
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Robert A. Profusek
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2005
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66
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Susan Kaufman Purcell
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1997
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74
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Stephen M. Waters
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2008
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70
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Randall J. Weisenburger
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2011
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58
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Rayford Wilkins, Jr.
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2011
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65
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Mr. Gorder
is Valero’s Chairman of the Board, President, and Chief Executive Officer. He was first elected to the Board in February 2014. He became Valero’s Chief Executive Officer on May 1, 2014, and Chairman of the Board on December 31, 2014. Previously he served as Valero’s President and Chief Operating Officer since November 2012. Prior to that, Mr. Gorder was Executive Vice President and Chief Commercial Officer beginning in January 2011, and led Valero’s European operations from its London office. Beginning in December 2005, he was Executive Vice President–Marketing and Supply. Mr. Gorder has held several positions with Valero and Ultramar Diamond Shamrock Corporation (UDS) with responsibilities for corporate development and marketing. Mr. Gorder is also Chief Executive Officer and Chairman of the Board of Valero Energy Partners GP LLC, the general partner of Valero Energy Partners LP (NYSE: VLP), a midstream logistics master limited partnership formed by Valero in 2013. He also serves on the board of directors of Anadarko Petroleum Corporation (NYSE: APC). Mr. Gorder’s pertinent experience, qualifications, attributes, and skills include his multiple years of experience in the refining industry during his years of service with UDS and Valero.
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Ms. Eberhart
is Chairman and Chief Executive Officer of HMS Ventures, a privately held business involved with technology services and the acquisition and management of real estate. From January 2011 through March 2014, she served as President and Chief Executive Officer of CDI Corp. (NYSE: CDI), a provider of engineering and information technology outsourcing and professional staffing services. She served as a consultant to CDI from April 2014 through December 2014. Ms. Eberhart also served as Chairman and Chief Executive Officer of HMS Ventures from January 2009 until January 2011. She served as President and Chief Executive Officer of Invensys Process Systems, Inc. (Invensys), a process automation company, from January 2007 to January 2009. From 1978 to 2004, she was an employee of Electronic Data Systems Corporation (EDS), an information technology and business process outsourcing company, and held roles of increasing responsibility, including senior level financial and operating roles. From 2003 until March 2004, Ms. Eberhart was President of Americas of EDS, and from 2002 to 2003 she served as President of Solutions Consulting at EDS. Ms. Eberhart is a Certified Public Accountant and serves as a director of Anadarko Petroleum Corporation (NYSE: APC), Ciber, Inc. (NYSE: CBR); and LPL Financial Holdings Inc. (NASDAQ: LPLA). In addition to her current public-company directorships, in the past five years she also served on the boards of CDI, Cameron International Corporation (NYSE: CAM) Fluor Corporation (NYSE: FLR) and Advanced Micro Devices, Inc. (NASDAQ: AMD). Ms. Eberhart’s pertinent experience, qualifications, attributes, and skills include executive management and leadership skills attained as a CEO of public and private companies, and financial literacy and expertise attained in her service as a financial executive and Certified Public Accountant.
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Ms. Greene
is Executive Vice President and Chief Operating Officer of the Southern Company (NYSE: SO), a position she has held since March 2014. Prior to that, she was President and Chief Executive Officer of Southern Company Services, Inc. Prior to rejoining Southern Company in April 2013, she was Executive Vice President and Chief Generation Officer of Tennessee Valley Authority (TVA). While at TVA, she served as Chief Financial Officer, Executive Vice President of financial services and Chief Risk Officer, as well as Group President for strategy and external relations. Ms. Greene began her career at Southern Company in 1991 and held positions of increasing responsibility in the areas of engineering, strategy, finance, and wholesale marketing, including Senior Vice President and Treasurer of Southern Company Services, Inc. from 2004 to 2007. Ms. Greene also serves on the board of directors of the Electric Power Research Institute. Ms. Greene’s pertinent experience, qualifications, attributes, and skills include executive managerial experience she has attained serving as an executive officer of other public and private companies, regulatory knowledge and expertise attained through her positions of responsibility in highly regulated industries, and financial literacy and expertise attained in her service as a financial executive.
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Ms. Majoras
has been Chief Legal Officer and Secretary of The Procter & Gamble Company (P&G) (NYSE: PG) since 2010. She joined P&G in 2008 as Senior Vice President and General Counsel. Previously she served as Chair of the Federal Trade Commission from 2004 until 2008. From 2001 to 2004, Ms. Majoras was Deputy Assistant Attorney General in the U.S. Department of Justice, Antitrust Division. Ms. Majoras joined the law firm of Jones Day in 1991, where she became a partner in 1999. Ms. Majoras serves on the boards of The Christ Hospital Health Network, the Cincinnati Legal Aid Society, the Association of General Counsel, Westminster College, and the Leadership Council on Legal Diversity. Ms. Majoras’s pertinent experience, qualifications, attributes, and skills include regulatory knowledge and expertise attained through her positions with the federal government; expertise in legal matters, leadership, and management skills attained while acting as an officer of a major U.S. publicly traded corporation and a partner with Jones Day; and leadership and management skills attained while serving as director or trustee of numerous non-profit organizations and a member of Valero’s Board since 2012.
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Senator Nickles
retired as U.S. Senator from Oklahoma in 2005 after serving in the U.S. Senate for 24 years. He had also served in the Oklahoma State Senate for two years. During his tenure as a U.S. Senator, he was Assistant Republican Leader for six years, Chairman of the Republican Senatorial Committee, and Chairman of the Republican Policy Committee. He served as Chairman of the Budget Committee and as a member of the Finance and Energy and Natural Resources Committees. In 2005, he formed and is the Chairman and Chief Executive Officer of The Nickles Group, a Washington-based consulting and business venture firm. Senator Nickles also serves on the Board of Trustees of Washington Mutual Investors Fund (AWSHX). He has served as a director of Valero since 2005. His pertinent experience, qualifications, attributes, and skills include extensive political, legislative and regulatory knowledge and expertise attained through his years of service as a U.S. Senator; the experience attained through his service on the boards of other public companies; the knowledge and experience he has attained from serving as founder and chief executive officer of a consulting and business venture firm; and the knowledge and experience he has attained through his service on Valero’s Board.
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Mr. Pfeiffer
is Of Counsel in the San Antonio office of Norton Rose Fulbright LLP, where he was Partner-in-Charge for 25 years and led the office’s labor and employment practice. Through his 47-year career with the firm, Mr. Pfeiffer assisted employers in traditional management–union matters, complex civil rights matters, employment discrimination cases, affirmative action compliance, employment torts, alternative dispute resolution, employment contracts, and ERISA litigation. He is a director and past Chair of the Board of Southwest Research Institute, a non-profit contract research corporation based in San Antonio, Texas. He serves or has served on the boards of many other non-profit organizations including the United Way of San Antonio and Bexar County, St. Mary’s University, San Antonio Medical Foundation, Texas Research and Technology Foundation, The Children’s Hospital of San Antonio Foundation, Alamo Area Council of Boy Scouts, and the Cancer Therapy and Research Center. Mr. Pfeiffer’s pertinent experience, qualifications, attributes, and skills include expertise in legal matters, including labor and employment issues, leadership and management skills attained while acting as Partner-in-Charge of a law office, and serving as chairman, director, or trustee of numerous non-profit organizations and his service on Valero’s Board.
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Mr. Profusek
is a partner of the Jones Day law firm where he chairs the firm’s global mergers and acquisitions practice. His law practice focuses on mergers, acquisitions, takeovers, restructurings, and corporate governance matters. Mr. Profusek is also the lead independent director of CTS Corporation (NYSE: CTS). He served as a director of the managing general partner of Valero L.P. (now known as NuStar Energy L.P.) from 2001–2005. He has served as a director of Valero since 2005. Mr. Profusek’s pertinent experience, qualifications, attributes, and skills include: legal expertise in legal matters, including corporate governance; capital markets expertise attained through his extensive experience in mergers and acquisitions and financing activities; managerial experience attained through his leadership roles with Jones Day; the knowledge and experience he has attained through his current service on another public company board and prior service as a director of other NYSE-listed companies; and the knowledge and experience he has attained through his service on Valero’s Board.
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Dr. Purcell
recently retired as Director of the Center for Hemispheric Policy at the University of Miami, a position she held since 2005. The Center examines political, economic, financial, trade, and security issues in Latin America, as well as U.S.-Latin America relations. She previously served as Vice President of the Council of the Americas, a non-profit business organization of mainly Fortune 500 companies with investments in Latin America, and of the Americas Society, a non-profit educational institution, both in New York City. She also was a member of the U.S. Department of State’s Policy Planning Staff. Dr. Purcell has been a director of Valero since 1997, and served as a director of its former parent company from 1994–1997. Dr. Purcell’s pertinent experience, qualifications, attributes, and skills include: economic, political and international relations expertise attained through her experience with the University of Miami, the Council of Americas, the Americas Society, and the U.S. Dept. of State; a Ph.D in political science; financial literacy and experience attained through her service on the boards and audit committees of several closed-end mutual funds; and the knowledge and experience she has attained through her service on Valero’s Board.
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Mr. Waters
has been the managing partner of Compass Partners Advisers LLP (Compass Partners) and its predecessor partnerships since 1996 and was the Chief Executive of Compass Partners European Equity Fund from 2005 to 2013. From 1988 to 1996, he served in several capacities at Morgan Stanley, including Co-Head of the Mergers and Acquisitions department from 1990 to 1992, Co-Chief Executive Officer of Morgan Stanley Europe from 1992 to 1996, and as a member of its worldwide Firm Operating Committee from 1992 to 1996. From 1974 to 1988, he was with Lehman Brothers, co-founding the Mergers and Acquisitions department in 1977, becoming a partner in 1980, and serving as Co-Head of the Mergers and Acquisitions department from 1985 to 1988. Mr. Waters is also Chairman of Boston Private Financial Holdings. His pertinent experience, qualifications, attributes, and skills include: financial literacy and expertise, capital markets expertise, and managerial experience gained through his mergers and acquisitions experience and leadership roles with investment banking firms, Lehman Brothers, Morgan Stanley, and Compass Partners; and the knowledge and experience he has attained through his service on Valero’s Board since 2008 and on other public company boards.
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Mr. Weisenburger
is the managing member of Mile26 Capital, LLC, a hedge fund based in Greenwich, Connecticut. He served as Executive Vice President and Chief Financial Officer of Omnicom Group Inc. (NYSE: OMC) from 1998 until September 2014. Prior to joining Omnicom, he was a founding member of Wasserstein Perella and a former member of First Boston Corporation. At Wasserstein Perella, Mr. Weisenburger specialized in private equity investing and leveraged acquisitions, and in 1993, he became President and CEO of the firm’s private equity subsidiary. His other corporate board service includes Carnival Corporation and Carnival plc (NYSE: CCL) and Acosta Sales and Marketing (privately held). He is a member of the Board of Overseers for the Wharton School of Business at the University of Pennsylvania. His pertinent experience, qualifications, attributes, and skills include financial literacy and expertise, capital markets expertise, managerial experience he has attained serving as an executive officer of other public companies, and the experience he has attained from service on Valero’s Board since 2011 and on other public company boards.
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Mr. Wilkins
previously served as CEO of Diversified Businesses of AT&T Inc. (NYSE: T), where he was responsible for international investments, AT&T Interactive, AT&T Advertising Solutions, customer information services, and the consumer wireless initiative in India. He retired from AT&T at the end of March 2012. Mr. Wilkins held several other leadership positions at AT&T and its predecessor companies, including Group President and CEO of SBC Enterprise Business Services and President and CEO of SBC Pacific Bell. He also serves on the board of Morgan Stanley (NYSE: MS) and the Advisory Council of the McCombs School of Business at the University of Texas at Austin. His pertinent experience, qualifications, attributes, and skills include managerial experience he has attained serving as an executive officer of other public companies, international business acumen he has attained from his responsibilities as executive officer and director for international business concerns, and the experience he has attained from service on Valero’s Board since 2011 and on other public company boards.
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Officer Since
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Age as of
12/31/2016
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Joseph W. Gorder
,
President and Chief Executive Officer
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2003
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59
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Jay D. Browning
,
Executive Vice President and General Counsel
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1997
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58
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Michael S. Ciskowski
,
Executive Vice President and Chief Financial Officer
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1998
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59
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R. Lane Riggs
,
Executive Vice President–Refining Operations and Engineering
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2011
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51
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Gary K. Simmons
,
Senior Vice President–Supply, International Operations and Systems Optimization
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2011
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52
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Name of Beneficial Owner
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Shares Held (1)
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Shares Under Options (2)
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Total Shares
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Percent of Class
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Jay D. Browning
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202,282
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32,219
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234,501
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*
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Michael S. Ciskowski
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297,662
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396,016
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693,678
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*
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H. Paulett Eberhart
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2,404
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—
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2,404
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*
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Joseph W. Gorder
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396,049
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232,186
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628,235
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*
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Kimberly S. Greene
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2,404
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—
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2,404
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*
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Deborah P. Majoras
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18,821
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—
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18,821
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*
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Donald L. Nickles
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24,876
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—
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24,876
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*
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Philip J. Pfeiffer
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21,164
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—
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21,164
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*
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Robert A. Profusek
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37,137
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—
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37,137
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*
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Susan Kaufman Purcell
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13,474
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—
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13,474
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*
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R. Lane Riggs
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132,253
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31,522
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163,775
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*
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Gary K. Simmons
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111,698
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—
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111,698
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*
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Stephen M. Waters
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12,511
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—
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12,511
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*
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Randall J. Weisenburger
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27,826
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—
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27,826
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*
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Rayford Wilkins, Jr.
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28,700
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—
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28,700
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*
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Directors and current executive officers as a group (15 persons)
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1,329,261
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691,943
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2,021,204
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*
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*
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Indicates that the percentage of beneficial ownership does not exceed 1% of the class.
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(1)
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Includes shares allocated under the Thrift Plan and shares of restricted stock. Restricted stock may not be sold or transferred until vested. For Mr. Browning, the balance shown also includes shares held by his spouse. For Mr. Ciskowski, the balance shown also includes shares held by an entity that he controls. The balance shown for Mr. Waters does not include 2,940 shares held in a trust for which his spouse serves as trustee (Mr. Waters disclaims beneficial ownership of those shares). This column does not include shares that could be acquired under options, which are reported in the column captioned “Shares Under Options.”
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(2)
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Represents shares of Common Stock that may be acquired under outstanding stock options currently exercisable and that are exercisable within 60 days from February 1, 2017. Shares subject to options may not be voted unless the options are exercised. Options that may become exercisable within such 60-day period only in the event of a change of control of Valero are excluded.
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Name and Address of Beneficial Owner
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Amount and Nature of Beneficial Ownership
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Percent of Class
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BlackRock, Inc
.
55 East 52nd Street
New York NY 10055
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33,350,640
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(1)
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7.4
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%
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The Vanguard Group
100 Vanguard Blvd
Malvern PA 19355
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32,577,618
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(2)
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7.2
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%
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State Street Corporation
State Street Financial Center
One Lincoln Street
Boston MA 02111
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26,631,472
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(3)
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5.9
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%
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(1)
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BlackRock, Inc. filed with the SEC an amended Schedule 13G on January 27, 2017, reporting that it or certain of its affiliates beneficially owned in the aggregate 33,350,640 shares, for which it had sole voting power for 28,498,554 shares and sole dispositive power for 33,350,640 shares.
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(2)
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The Vanguard Group filed with the SEC a Schedule 13G on February 13, 2017, reporting that it or certain of its affiliates beneficially owned in the aggregate 32,577,618 shares, for which it had sole voting power for 720,510 shares, shared voting power for 91,037 shares, sole dispositive power for 31,769,485 shares, and shared dispositive power for 808,133 shares.
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(3)
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State Street Corporation filed with the SEC a Schedule 13G on February 10, 2017, reporting that it or certain of its affiliates beneficially owned in the aggregate 26,631,472 shares, for which it had shared voting power and shared dispositive power.
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•
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the mix between fixed and variable, annual and long-term, and cash and equity compensation, designed to encourage strategies and actions that are in Valero’s long-term best interests;
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•
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determination of incentive awards based on a variety of indicators of performance, thus diversifying the risk associated with a single indicator of performance;
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•
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incorporation of relative total stockholder return into our incentive program, calibrating pay and performance relationships to companies facing the same or similar market forces as Valero;
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•
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multi-year vesting periods for equity incentive awards, which encourage focus on sustained growth and earnings;
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•
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maximum payout ceilings under our annual bonus program and performance share awards;
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•
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restricted stock awards that help contain volatility of incentive awards and further align executives’ interests with long-term stockholder value creation; and
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•
|
our compensation-related policies, including our executive compensation “clawback” policy and stock ownership guidelines (discussed below under the caption “Compensation Discussion and Analysis—Compensation Related Policies”).
|
•
|
assistance with selecting peer and comparator companies for benchmarking executive pay and monitoring Valero’s performance;
|
•
|
assistance with establishing our overall executive compensation philosophy in light of our business strategies;
|
•
|
assessment of competitive pay for our executives, with separate analyses of base salary, annual incentive, and long-term incentive compensation;
|
•
|
assessment of competitive pay for our directors;
|
•
|
assessment of, and recommendations for, our annual incentive bonus program;
|
•
|
assessment of, and recommendation of enhancements to, our long-term incentive program strategy, including (i) the design of an appropriate mix of equity incentive vehicles, (ii) determination of performance measures and measurement techniques, and (iii) determination of competitive equity grant guidelines consistent with our overall pay philosophy;
|
•
|
updates on trends and developments in executive compensation, new regulatory issues, and best practices; and
|
•
|
assistance with proxy statement disclosures.
|
•
|
We returned $2.4 billion to our stockholders through dividend payments ($1.1 billion) and common stock repurchases ($1.3 billion).
|
•
|
We increased our regular quarterly cash dividend 20 percent from $0.50 per share to $0.60 per share.
|
•
|
We continued to maintain our investment-grade credit rating.
|
•
|
We achieved best-ever overall health, safety, and environmental performance.
|
•
|
We achieved best-ever mechanical availability performance allowing us to maximize margin capture when market conditions are favorable and be recognized as the premier operator in our industry.
|
•
|
We significantly exceeded our cost savings goal, supporting our objective of being the industry’s lowest-cost operator with focus on continuous improvement in reducing secondary costs. We have realized over $1.6 billion in savings since the cost savings program was initiated in 2007.
|
•
|
We successfully completed and commissioned a new crude distillation unit at our Houston refinery.
|
•
|
We successfully completed $565 million in drop-down sales of midstream assets to our master limited partnership, Valero Energy Partners LP, consistent with our strategy to unlock value in our pipelines, terminals, and other transportation and logistics assets.
|
•
|
We employed rigorous selection reviews for capital projects and potential mergers and acquisitions.
|
•
|
Institutional Investor magazine named Valero among its “Most Honored Companies” based on results in
Best CEO, CFO, IR Professional, IR Program
and
Website
categories. The honors are earned as a result of the magazine’s “2017 All-America Executive Team” rankings, which are based on investment community surveys. Mr. Gorder earned overall
Best CEO
for the integrated oil sector.
|
•
|
In 2016, long-term incentives represented the largest component of targeted pay for our named executive officers, ranging from 51 percent of total targeted pay for our senior vice presidents to 71 percent of total targeted pay for our CEO.
|
•
|
All long-term incentives awarded in 2016 are aligned with stock price performance, linking executives’ pay directly with the creation of stockholder value.
|
•
|
Fifty percent of the total shares targeted for our named executive officers in 2016 were performance shares.
|
◦
|
The performance share awards require Valero’s Total Shareholder Return (TSR) to meet or exceed the median TSR of our peers in order to reach or exceed targeted payout levels. As such, our executives are motivated to cause Valero’s results to exceed that of our peers.
|
◦
|
Our performance shares are described below in this Compensation Discussion and Analysis under the caption “Elements of Executive Compensation—Long-Term Incentive Awards—Performance Shares.”
|
•
|
Shares of restricted stock granted to our executive officers motivate the creation of stockholder value through stock price gains and promote the retention of critical talent.
|
•
|
The annual incentive bonus pool for named executive officers is funded using quantitative company performance measures that correspond to our business priorities: (i) Adjusted Net Cash Provided by Operating Activities; and (ii) EBITDA. Our annual incentive bonus program is discussed below under the caption “Elements of Executive Compensation—Annual Incentive Bonus.”
|
•
|
Our annual performance goals include challenging requirements across an array of financial, operating, and strategic objectives. The 2016 objectives included earnings per share (EPS), mechanical availability, cost management, and pre-established goals relating to health, safety, and environmental performance.
|
•
|
These annual performance goals are measured primarily on an absolute basis, requiring performance that exceeds goals established in the first quarter of the year. By balancing these absolute goals with the relative TSR requirements under our performance share incentives, we motivate a dual focus on both Valero’s performance versus our operating plan and Valero’s performance compared to our peers.
|
•
|
Incentive compensation (annual bonus and long-term incentives) represents the majority (ranging from 70 percent to 88 percent) of the targeted direct compensation of our named executive officers.
|
•
|
We use multiple performance metrics to motivate achievements that complement one another and that contribute to the long-term creation of stockholder value.
|
•
|
Incentives are balanced between absolute performance goals (rewarding the achievement of pre-established goals) and relative measures (linking the incentives to surpassing the performance of our peers).
|
•
|
We target 50 percent of the long-term incentive value granted to our named executive officers to be awarded in the form of performance shares tied to relative TSR performance.
|
•
|
We have maximum payout ceilings on both our annual bonus opportunities and our performance shares.
|
•
|
Valero’s revenues and market capitalization are within a reasonable range of the median revenues and market capitalization of the peer group of companies within our industry against which we benchmark our executives’ pay, reflecting that we make pay comparisons in a size-appropriate fashion.
|
•
|
We benchmark against the median pay levels of the peer group for each of base pay, annual bonus, and long-term incentives.
|
•
|
We have eliminated all change-in-control gross ups for potential parachute excise taxes and maintain a policy against the implementation of change-in-control arrangements that contain gross-ups.
|
•
|
We have a policy stipulating that grants of performance shares contain terms and conditions for vesting in a change-of-control context such that performance shares will vest on a partial, pro rata basis following termination of employment (rather than vesting automatically in full upon the change of control).
|
•
|
Our long-term incentive program mandates that stock options cannot be re-priced without stockholder approval.
|
•
|
Our executive officers and directors are subject to meaningful stock ownership guidelines.
|
•
|
Our executive officers and directors are prohibited from pledging shares of Common Stock as collateral or security for indebtedness, and may not purchase, sell, or write calls, puts, or other options or derivative instruments on shares of Common Stock.
|
•
|
We have a “clawback” policy requiring the return of incentive payments in certain restatement situations.
|
•
|
We engage in stockholder outreach to solicit the input of stockholders to our pay programs.
|
•
|
Our executive pay programs include design features that mitigate against the risk of inappropriate behaviors.
|
•
|
Our Compensation Committee is composed entirely of directors who meet the independence requirements of the SEC and NYSE as well as pertinent tax requirements for preserving the deductibility of executive pay.
|
•
|
Our Compensation Committee retains the services of an independent executive compensation consultant that provides services directly to the Committee.
|
•
|
We conduct an annual say-on-pay vote as recommended by our stockholders.
|
•
|
We have a declassified board of directors.
|
•
|
Our Board has approved a limitation on the amount of equity compensation that may be paid to our non-employee directors in any year.
|
•
|
In 2016 we engaged a third-party to conduct a review of our governance documents and committee charters, and we adopted revisions thereto, to ensure compliance with regulatory requirements and alignment with best practices.
|
•
|
In 2016, we adopted amendments to our Bylaws granting proxy access to our stockholders.
|
BP p.l.c.
|
|
Marathon Petroleum Corporation
|
Chevron Corporation
|
|
Murphy Oil Corporation
|
Exxon Mobil Corporation
|
|
Phillips 66
|
Hess Corporation
|
|
Royal Dutch Shell plc
|
HollyFrontier Corporation
|
|
Tesoro Corporation
|
Marathon Oil Corporation
|
|
|
Alon USA Energy, Inc.
|
PBF Energy Inc.
|
BP p.l.c.
|
Phillips 66
|
CVR Energy Inc.
|
Royal Dutch Shell plc
|
Delek US Holdings
|
Tesoro Corporation
|
HollyFrontier Corporation
|
Western Refining Inc.
|
Marathon Petroleum Corporation
|
|
•
|
base salary;
|
•
|
annual incentive bonus;
|
•
|
long-term equity-based incentives;
|
•
|
medical and other insurance benefits; and
|
•
|
retirement benefits.
|
•
|
to provide compensation payouts that are tied to the performance of internal and external metrics both on a relative and absolute basis; and
|
•
|
to attract, motivate, and retain the best executive talent in our industry.
|
•
|
Valero’s attainment of key financial performance measures;
|
•
|
Valero’s success in key operational and strategic measures;
|
•
|
safe operations;
|
•
|
environmental responsibility;
|
•
|
reliable operations; and
|
•
|
cost management.
|
•
|
long-term stock price performance; and
|
•
|
payment of regular dividends.
|
•
|
the position of the named executive officer, which is used to determine a targeted percentage of base salary that may be awarded as incentive bonus;
|
•
|
pre-established performance objectives that include a quantitative financial performance goal (
Financial Performance Goal)
, operational performance goals (
Operational Performance Goals)
, and qualitative goals and objectives including the effective use of capital (
Strategic Company Performance Goals
) for the completed fiscal year; and
|
•
|
a qualitative evaluation of the individual’s performance.
|
•
|
Valero’s achievements in the areas of health, safety, and environmental;
|
•
|
Valero’s achievements in improving refining competitiveness through improved mechanical availability; and
|
•
|
Valero’s achievements in cost management and expense control.
|
|
Gorder
|
Ciskowski
|
Riggs
|
Browning
|
Simmons
|
|||||
Base salary (1)
|
$1,450,000
|
$890,000
|
$640,000
|
$595,000
|
$565,000
|
|||||
Bonus target percentage (2)
|
150%
|
|
110%
|
|
80%
|
|
80%
|
|
65%
|
|
Bonus target amount (3)
|
$2,175,000
|
$979,000
|
$512,000
|
$476,000
|
$367,250
|
|||||
Bonus percentage achieved (4)
|
134.23
|
%
|
134.23
|
%
|
134.23
|
%
|
134.23
|
%
|
134.23
|
%
|
Earned target incentive bonus (5)
|
$2,919,503
|
$1,314,112
|
$687,258
|
$638,935
|
$492,960
|
|||||
Maximum possible bonus (6)
|
$17,945,000
|
$7,178,000
|
$3,589,000
|
$3,589,000
|
$3,589,000
|
|||||
Bonus amount paid (7)
|
$2,925,000
|
$1,320,000
|
$725,000
|
$640,000
|
$500,000
|
(1)
|
Base salary is the officer’s base salary at December 31, 2016.
|
(2)
|
Bonus target as a percentage of base salary.
|
(3)
|
Determined by multiplying “Bonus target percentage” times “Base salary.”
|
(4)
|
Valero’s performance score for “Bonus percentage achieved” was 134.23% based on results of the Annual Incentive Bonus Performance Goals detailed in the previous table.
|
(5)
|
Determined by multiplying “Bonus target amount” times “Bonus percentage achieved.”
|
(6)
|
Represents allocation of maximum bonus pool funded from the 2016 EBITDA results apportioned as follows: 50% for CEO, 20% for second highest paid officer, and 10% for next three highest paid officers.
|
(7)
|
As disclosed in the Summary Compensation Table. The actual amount paid was determined based on: (i) Valero’s performance and maximum bonus pool funding using EBITDA, (ii) Valero’s performance as measured against financial, operational, and strategic goals, and (iii) the Committee’s assessment of the named executive officers’ individual performance in 2016. (Based on superior EBITDA results, the maximum bonus funding is significantly greater than the final earned amounts, so the final bonus awards represent the application of the Compensation Committee’s downward discretion from the maximum bonus funding.)
|
Officer Position
|
|
Value of Shares Owned
|
Chief Executive Officer
|
|
5x Base Salary
|
President
|
|
3x Base Salary
|
Executive Vice Presidents
|
|
2x Base Salary
|
Senior Vice Presidents
|
|
1x Base Salary
|
Vice Presidents
|
|
1x Base Salary
|
|
|
Number of
Securities
to be Issued
Upon Exercise
of Outstanding
Options, Warrants
and Rights (#)
|
|
Weighted-
Average
Exercise Price
of Outstanding
Options, Warrants
and Rights ($)
|
|
Number of
Securities
Remaining Avail-
able for Future
Issuance Under
Equity Compen-
sation Plans (1)
|
||||
Approved by stockholders
:
|
|
|
|
|
|
|
||||
2011 Omnibus Stock Incentive Plan
|
|
872,458
|
|
|
$
|
31.71
|
|
|
10,581,274
|
|
2005 Omnibus Stock Incentive Plan
|
|
1,070,715
|
|
|
17.86
|
|
|
—
|
|
|
Not approved by stockholders
:
|
|
|
|
|
|
|
||||
2003 All-Employee Stock Incentive Plan
(2)
|
|
77,872
|
|
|
17.68
|
|
|
—
|
|
|
Total
|
|
2,021,045
|
|
|
23.83
|
|
|
10,581,274
|
|
(1)
|
Securities available for future issuance under these plans can be issued in various forms, including restricted stock and stock options.
|
(2)
|
Officers and directors of Valero were not eligible to receive grants under this plan.
|
Principal Position (1)
|
|
Year
|
|
Salary ($)
|
|
Stock Awards
($)(2)(3)
|
|
Option Awards
($)(2)(4)
|
|
Non-Equity Incentive Plan Compensa-tion ($)(5)
|
|
Change in Pension Value and Non-qualified Deferred Compensation Earnings ($) (6)
|
|
All Other Compensa-tion ($)(7)
|
|
Total ($)
|
|||||||
Joseph W. Gorder
,
|
|
2016
|
|
1,450,000
|
|
|
10,610,898
|
|
|
—
|
|
|
2,925,000
|
|
|
3,334,310
|
|
|
132,410
|
|
|
18,452,618
|
|
Chairman of the Board, President, and CEO
|
|
2015
|
|
1,300,000
|
|
|
8,870,341
|
|
|
—
|
|
|
3,900,000
|
|
|
3,252,393
|
|
|
212,411
|
|
|
17,535,145
|
|
|
2014
|
|
1,150,000
|
|
|
7,989,851
|
|
|
758,205
|
|
|
3,525,000
|
|
|
3,838,763
|
|
|
111,619
|
|
|
17,373,438
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Michael S. Ciskowski
,
|
|
2016
|
|
890,000
|
|
|
4,057,373
|
|
|
—
|
|
|
1,320,000
|
|
|
1,855,463
|
|
|
91,783
|
|
|
8,214,619
|
|
EVP and CFO
|
|
2015
|
|
845,000
|
|
|
3,809,824
|
|
|
—
|
|
|
1,859,000
|
|
|
1,551,671
|
|
|
83,683
|
|
|
8,149,178
|
|
|
2014
|
|
810,000
|
|
|
2,912,035
|
|
|
299,752
|
|
|
1,670,000
|
|
|
2,923,019
|
|
|
82,337
|
|
|
8,697,143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
R. Lane Riggs
,
|
|
2016
|
|
640,000
|
|
|
2,191,016
|
|
|
—
|
|
|
725,000
|
|
|
1,206,237
|
|
|
73,248
|
|
|
4,835,501
|
|
EVP–Refining Operations and Engineering
|
|
2015
|
|
600,000
|
|
|
1,661,614
|
|
|
—
|
|
|
960,000
|
|
|
1,046,542
|
|
|
69,005
|
|
|
4,337,161
|
|
|
2014
|
|
558,333
|
|
|
1,464,417
|
|
|
138,453
|
|
|
862,000
|
|
|
1,473,045
|
|
|
61,935
|
|
|
4,558,183
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Jay D. Browning,
|
|
2016
|
|
595,000
|
|
|
1,773,224
|
|
|
—
|
|
|
640,000
|
|
|
973,148
|
|
|
71,101
|
|
|
4,052,473
|
|
EVP and General Counsel
|
|
2015
|
|
575,000
|
|
|
1,591,603
|
|
|
—
|
|
|
920,000
|
|
|
1,012,273
|
|
|
66,816
|
|
|
4,165,692
|
|
|
2014
|
|
541,667
|
|
|
1,361,956
|
|
|
132,223
|
|
|
825,000
|
|
|
1,384,309
|
|
|
70,765
|
|
|
4,315,920
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Gary K. Simmons
,
|
|
2016
|
|
565,000
|
|
|
1,203,887
|
|
|
—
|
|
|
500,000
|
|
|
876,063
|
|
|
57,980
|
|
|
3,202,930
|
|
SVP–Supply, Int’l Ops. & Systems Optimization
|
|
(8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
(8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The persons listed in this table are referred to in this proxy statement as our “named executive officers.”
|
(2)
|
The amounts shown represent the grant date fair value of stock awards computed under Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation–Stock Compensation (FASB ASC Topic 718). Under FASB ASC Topic 718, the grant date fair values that we must disclose for our performance share awards include the values of certain tranches of unvested performance shares that were awarded in years prior to the fiscal year shown in the table. The computations of grant date fair values for performance shares are more fully described in footnote (5) to the Grants of Plan-Based Awards table in this proxy statement.
|
|
|
Gorder
|
|
Ciskowski
|
|
Riggs
|
|
Browning
|
|
Simmons
|
|||||
restricted stock
|
|
4,857,423
|
|
|
1,819,323
|
|
|
1,057,883
|
|
|
790,318
|
|
|
535,719
|
|
performance shares
|
|
5,753,475
|
|
|
2,238,050
|
|
|
1,133,133
|
|
|
982,906
|
|
|
668,168
|
|
total (in dollars)
|
|
10,610,898
|
|
|
4,057,373
|
|
|
2,191,016
|
|
|
1,773,224
|
|
|
1,203,887
|
|
(3)
|
For more information regarding the shares of restricted stock and performance shares granted in 2016, see the Grants of Plan-Based Awards table in this proxy statement and our disclosures in Note 13 (“Stock-Based Compensation”) of Notes to Consolidated Financial Statements in Valero’s Annual Report on Form 10-K for the year ended December 31, 2016.
|
(4)
|
Stock options were not granted to our named executive officers in 2016 or 2015.
|
(5)
|
Represents amounts earned under our annual incentive bonus plan, as described in “Compensation Discussion and Analysis
—
Elements of Executive Compensation
—
Annual Incentive Bonus.”
|
(6)
|
This column represents the sum of the change in pension value and non-qualified deferred compensation earnings for each of the named executive officers. See the Pension Benefits table for the present value assumptions used for these calculations. The amount of above-market or preferential earnings on non-tax-qualified deferred compensation included in the amounts presented above is zero.
|
(7)
|
The amounts listed as “All Other Compensation” for 2016 are composed of these items:
|
Items of income (in dollars)
|
|
Gorder
|
|
Ciskowski
|
|
Riggs
|
|
Browning
|
|
Simmons
|
|||||
Valero contribution to Thrift Plan account
|
|
18,550
|
|
|
18,550
|
|
|
18,550
|
|
|
18,550
|
|
|
18,550
|
|
Valero contribution to Excess Thrift Plan account
|
|
82,950
|
|
|
43,750
|
|
|
26,250
|
|
|
23,000
|
|
|
21,000
|
|
Reimbursement of club membership dues
|
|
7,937
|
|
|
6,682
|
|
|
7,937
|
|
|
5,070
|
|
|
8,327
|
|
Unused benefit dollars
|
|
—
|
|
|
628
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Imputed income
—
personal liability insurance (Group Excess Policy)
|
|
3,648
|
|
|
3,648
|
|
|
3,648
|
|
|
3,648
|
|
|
2,158
|
|
Imputed income
—
individual disability insurance
|
|
4,617
|
|
|
4,617
|
|
|
2,877
|
|
|
3,587
|
|
|
3,029
|
|
Imputed income
—
long-term disability premium
|
|
2,280
|
|
|
2,280
|
|
|
2,280
|
|
|
2,280
|
|
|
2,280
|
|
Imputed income
—
insurance (life & survivor) over $50,000
|
|
4,928
|
|
|
4,128
|
|
|
6,739
|
|
|
9,416
|
|
|
2,636
|
|
Imputed income
—
tax return preparation fees
|
|
7,500
|
|
|
7,500
|
|
|
4,967
|
|
|
5,550
|
|
|
—
|
|
total
|
|
132,410
|
|
|
91,783
|
|
|
73,248
|
|
|
71,101
|
|
|
57,980
|
|
(8)
|
Mr. Simmons was not a named executive officer for 2015 or 2014.
|
|
|
|
|
|
|
Estimated Future Payouts Under
Non-Equity Incentive Plan Awards
|
|
Estimated Future Payouts Under
Equity Incentive Plan Awards
|
|
Grant Date Fair Value of Stock and Option Awards ($) (1)
|
||||||||||||||
|
|
|
|
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
|||||||
Name
|
|
Grant Date
|
|
|
|
($)
|
|
($)
|
|
($)
|
|
(#)
|
|
(#)
|
|
(#)
|
|
|||||||
Joseph W. Gorder
|
|
n/a
|
|
(2)
|
|
—
|
|
|
2,175,000
|
|
|
17,945,000
|
|
|
|
|
|
|
|
|
|
|||
|
|
11/02/2016
|
|
(3)
|
|
|
|
|
|
|
|
n/a
|
|
82,420
|
|
|
n/a
|
|
|
4,857,423
|
|
|||
|
|
n/a
|
|
(4)
|
|
|
|
|
|
|
|
|
|
82,420
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
27,474
|
|
|
54,948
|
|
|
1,881,420
|
|
|||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
19,590
|
|
|
39,180
|
|
|
1,798,558
|
|
|||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
17,523
|
|
|
35,046
|
|
|
2,073,497
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Michael S. Ciskowski
|
|
n/a
|
|
(2)
|
|
—
|
|
|
979,000
|
|
|
7,178,000
|
|
|
|
|
|
|
|
|
|
|||
|
|
11/02/2016
|
|
(3)
|
|
|
|
|
|
|
|
n/a
|
|
30,870
|
|
|
n/a
|
|
|
1,819,323
|
|
|||
|
|
n/a
|
|
(4)
|
|
|
|
|
|
|
|
|
|
30,870
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
10,290
|
|
|
20,580
|
|
|
704,659
|
|
|||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
7,770
|
|
|
15,540
|
|
|
713,364
|
|
|||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
6,930
|
|
|
13,860
|
|
|
820,027
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
R. Lane Riggs
|
|
n/a
|
|
(2)
|
|
—
|
|
|
512,000
|
|
|
3,589,000
|
|
|
|
|
|
|
|
|
|
|||
|
|
11/02/2016
|
|
(3)
|
|
|
|
|
|
|
|
n/a
|
|
17,950
|
|
|
n/a
|
|
|
1,057,883
|
|
|||
|
|
n/a
|
|
(4)
|
|
|
|
|
|
|
|
|
|
17,950
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
5,984
|
|
|
11,968
|
|
|
409,784
|
|
|||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
3,583
|
|
|
7,166
|
|
|
328,955
|
|
|||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
3,333
|
|
|
6,666
|
|
|
394,394
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Jay D. Browning
|
|
n/a
|
|
(2)
|
|
—
|
|
|
476,000
|
|
|
3,589,000
|
|
|
|
|
|
|
|
|
|
|||
|
|
11/02/2016
|
|
(3)
|
|
|
|
|
|
|
|
n/a
|
|
13,410
|
|
|
n/a
|
|
|
790,318
|
|
|||
|
|
n/a
|
|
(4)
|
|
|
|
|
|
|
|
|
|
13,410
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
4,470
|
|
|
8,940
|
|
|
306,106
|
|
|||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
3,433
|
|
|
6,866
|
|
|
315,184
|
|
|||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
3,056
|
|
|
6,112
|
|
|
361,616
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Gary K. Simmons
|
|
n/a
|
|
(2)
|
|
—
|
|
|
367,250
|
|
|
3,589,000
|
|
|
|
|
|
|
|
|
|
|||
|
|
11/02/2016
|
|
(3)
|
|
|
|
|
|
|
|
n/a
|
|
9,090
|
|
|
n/a
|
|
|
535,719
|
|
|||
|
|
n/a
|
|
(4)
|
|
|
|
|
|
|
|
|
|
9,090
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
3,030
|
|
|
6,060
|
|
|
207,494
|
|
|||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
2,333
|
|
|
4,666
|
|
|
214,193
|
|
|||
|
|
11/02/2016
|
|
(5)
|
|
|
|
|
|
|
|
|
|
2,083
|
|
|
4,166
|
|
|
246,481
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The reported grant date fair value of stock awards was determined in compliance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 718. Stock options were not granted to our named executive officers in 2016.
|
(2)
|
Represents potential awards under our annual incentive bonus program for named executive officers (NEOs). Actual amounts earned by our NEOs for 2016 are reported in the Summary Compensation Table under the column “Non-Equity Incentive Plan Compensation.” The “target” amounts listed in the Grants of Plan-Based Awards table are computed by multiplying base salary by 150%, 110%, 80%, 80%, and 65%, for Mr. Gorder, Mr. Ciskowski, Mr. Riggs, Mr. Browning, and Mr. Simmons, respectively.
|
(3)
|
Represents an award of restricted stock granted November 2, 2016. The shares are scheduled to vest (become nonforfeitable) annually in equal one-third increments. Dividends on the restricted shares are paid as and when dividends are declared and paid on our Common Stock. Restricted stock awards are more fully described in “Compensation Discussion and Analysis—Elements of Executive Compensation—Long-Term Incentive Awards—Restricted Stock.” For each NEO, the dollar amount stated in the column “Grant Date Fair Value of Stock and Option Awards” is included within the amount listed in the “Stock Awards” column of the Summary Compensation Table and in footnote (2) to the Summary Compensation Table.
|
(4)
|
Represents the number of performance shares awarded under our 2011 Omnibus Stock Incentive Plan to our NEOs on November 2, 2016 under our long-term incentive awards program described in “Compensation Discussion and Analysis—Elements of Executive Compensation—Long-Term Incentive Awards—Performance Shares.” Per the awards’ terms, on a normal vesting date officers can earn, in shares of Common Stock, from 0% to 200% of the number of performance shares that are vesting, based upon Valero’s achievement of objective performance measures during the performance periods prescribed by our Compensation Committee. The performance shares are scheduled to vest annually in one-third increments (tranches) in January 2018, January 2019, and January 2020, with any resulting payout at those times conditioned upon Valero’s performance during the pertinent performance periods. Only the first tranche of these performance shares is deemed to have a “grant date” in 2016, as explained in footnote (5) below. Our disclosures referenced by footnote (4) are for information purposes only, and tie to the disclosures made by our NEOs in 2016 on Forms 4 in compliance with Section 16 of the Exchange Act. Our disclosures in footnote (5) below are intended to comply with the requirements of Item 402 of Regulation S-K with respect to “grants” of performance shares.
|
(5)
|
We are required by Item 402(d)(2)(viii) of Regulation S-K to make the disclosures referenced by footnote (5). This Item requires us to disclose the “grant date fair value” of equity awards “computed in accordance with FASB ASC Topic 718” (Topic 718). Our performance shares are awarded in three tranches, with the tranches having measurement periods (the performance period) of differing lengths. The first tranche of an award has a performance period of 12 months, the second tranche of an award has a performance period of 24 months, and the third tranche of an award has a performance period of 36 months.
|
|
performance shares deemed (under Topic 718) to have a grant date in 2016
|
|
grant date fair value ($)
|
||||
|
|
|
|
|
|
||
Gorder
|
1st tranche of 2016 award
|
|
27,474
|
|
|
1,881,420
|
|
|
2nd tranche of 2015 award
|
|
19,590
|
|
|
1,798,558
|
|
|
3rd tranche of 2014 award
|
|
17,523
|
|
|
2,073,497
|
|
|
total 2016 grant date fair value
|
|
|
|
5,753,475
|
|
|
|
|
|
|
|
|
||
Ciskowski
|
1st tranche of 2016 award
|
|
10,290
|
|
|
704,659
|
|
|
2nd tranche of 2015 award
|
|
7,770
|
|
|
713,364
|
|
|
3rd tranche of 2014 award
|
|
6,930
|
|
|
820,027
|
|
|
total 2016 grant date fair value
|
|
|
|
2,238,050
|
|
|
|
|
|
|
|
|
||
Riggs
|
1st tranche of 2016 award
|
|
5,984
|
|
|
409,784
|
|
|
2nd tranche of 2015 award
|
|
3,583
|
|
|
328,955
|
|
|
3rd tranche of 2014 award
|
|
3,333
|
|
|
394,394
|
|
|
total 2016 grant date fair value
|
|
|
|
1,133,133
|
|
|
|
|
|
|
|
|
||
Browning
|
1st tranche of 2016 award
|
|
4,470
|
|
|
306,106
|
|
|
2nd tranche of 2015 award
|
|
3,433
|
|
|
315,184
|
|
|
3rd tranche of 2014 award
|
|
3,056
|
|
|
361,616
|
|
|
total 2016 grant date fair value
|
|
|
|
982,906
|
|
|
|
|
|
|
|
|
||
Simmons
|
1st tranche of 2016 award
|
|
3,030
|
|
|
207,494
|
|
|
2nd tranche of 2015 award
|
|
2,333
|
|
|
214,193
|
|
|
3rd tranche of 2014 award
|
|
2,083
|
|
|
246,481
|
|
|
total 2016 grant date fair value
|
|
|
|
668,168
|
|
|
|
1st tranche of 2016 award (shares)
|
|
grant date fair value ($)
|
|
highest possible performance ($)
|
|||
Gorder
|
|
27,474
|
|
|
1,881,420
|
|
|
3,762,839
|
|
Ciskowski
|
|
10,290
|
|
|
704,659
|
|
|
1,409,318
|
|
Riggs
|
|
5,984
|
|
|
409,784
|
|
|
819,569
|
|
Browning
|
|
4,470
|
|
|
306,106
|
|
|
612,211
|
|
Simmons
|
|
3,030
|
|
|
207,494
|
|
|
414,989
|
|
|
|
2nd tranche of 2015 award (shares)
|
|
grant date fair value ($)
|
|
highest possible performance ($)
|
|||
Gorder
|
|
19,590
|
|
|
1,798,558
|
|
|
3,597,116
|
|
Ciskowski
|
|
7,770
|
|
|
713,364
|
|
|
1,426,727
|
|
Riggs
|
|
3,583
|
|
|
328,955
|
|
|
657,910
|
|
Browning
|
|
3,433
|
|
|
315,184
|
|
|
630,367
|
|
Simmons
|
|
2,333
|
|
|
214,193
|
|
|
428,385
|
|
|
|
3rd tranche of 2014 award (shares)
|
|
grant date fair value ($)
|
|
highest possible performance ($)
|
|||
Gorder
|
|
17,523
|
|
|
2,073,497
|
|
|
4,146,993
|
|
Ciskowski
|
|
6,930
|
|
|
820,027
|
|
|
1,640,054
|
|
Riggs
|
|
3,333
|
|
|
394,394
|
|
|
788,788
|
|
Browning
|
|
3,056
|
|
|
361,616
|
|
|
723,233
|
|
Simmons
|
|
2,083
|
|
|
246,481
|
|
|
492,963
|
|
|
|
Option Awards
|
|
Stock Awards
|
||||||||||||||||||||||||||||
|
|
|
|
Restricted Stock
|
|
Performance Shares
|
||||||||||||||||||||||||||
|
|
Number of Securities Underlying Unexercised Options (#) Exercisable
|
|
Number of Securities Underlying Unexercised Options (#) Unexercisable
|
|
Option Exercise Price ($)(1)
|
|
Option Expiration Date
|
|
Number of Shares or Units of Stock That Have Not Vested (#)
|
|
Market Value of Shares or Units of Stock That Have Not Vested ($)(2)
|
|
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (2)
|
|
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(2)
|
||||||||||||||||
Joseph W. Gorder
|
|
85,493
|
|
|
—
|
|
|
|
|
18.145
|
|
|
10/15/2019
|
|
6,698
|
|
|
(4
|
)
|
|
457,607
|
|
|
12,710
|
|
|
(8
|
)
|
|
1,736,694
|
|
|
|
|
21,400
|
|
|
—
|
|
|
|
|
17.743
|
|
|
11/17/2020
|
|
15,258
|
|
|
(5
|
)
|
|
1,042,427
|
|
|
35,046
|
|
|
(9
|
)
|
|
3,591,514
|
|
|
|
|
26,750
|
|
|
—
|
|
|
|
|
24.582
|
|
|
10/28/2021
|
|
22,744
|
|
|
(6
|
)
|
|
1,553,870
|
|
|
58,770
|
|
|
(10
|
)
|
|
4,684,361
|
|
|
|
|
37,567
|
|
|
—
|
|
|
|
|
27.318
|
|
|
11/09/2022
|
|
47,844
|
|
|
(7
|
)
|
|
3,268,702
|
|
|
82,420
|
|
|
(11
|
)
|
|
5,630,934
|
|
|
|
|
31,770
|
|
|
—
|
|
|
|
|
39.665
|
|
|
11/08/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
29,206
|
|
|
14,604
|
|
|
(3
|
)
|
|
48.565
|
|
|
10/23/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Michael S. Ciskowski
|
|
251,530
|
|
|
—
|
|
|
|
|
18.145
|
|
|
10/15/2019
|
|
6,034
|
|
|
(5
|
)
|
|
412,243
|
|
|
9,333
|
|
|
(8
|
)
|
|
1,275,261
|
|
|
|
|
32,100
|
|
|
—
|
|
|
|
|
17.743
|
|
|
11/17/2020
|
|
9,021
|
|
|
(6
|
)
|
|
616,315
|
|
|
13,860
|
|
|
(9
|
)
|
|
1,420,373
|
|
|
|
|
44,940
|
|
|
—
|
|
|
|
|
24.582
|
|
|
10/28/2021
|
|
17,920
|
|
|
(7
|
)
|
|
1,224,294
|
|
|
23,310
|
|
|
(10
|
)
|
|
1,857,962
|
|
|
|
|
32,570
|
|
|
—
|
|
|
|
|
27.318
|
|
|
11/09/2022
|
|
|
|
|
|
|
|
30,870
|
|
|
(11
|
)
|
|
2,109,038
|
|
||||
|
|
23,330
|
|
|
—
|
|
|
|
|
39.665
|
|
|
11/08/2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
11,546
|
|
|
5,774
|
|
|
(3
|
)
|
|
48.565
|
|
|
10/23/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
R. Lane Riggs
|
|
11,770
|
|
|
—
|
|
|
|
|
24.582
|
|
|
10/28/2021
|
|
1,878
|
|
|
(4
|
)
|
|
128,305
|
|
|
2,653
|
|
|
(8
|
)
|
|
362,506
|
|
|
|
|
7,789
|
|
|
—
|
|
|
|
|
27.318
|
|
|
11/09/2022
|
|
4,834
|
|
|
(5
|
)
|
|
330,259
|
|
|
6,666
|
|
|
(9
|
)
|
|
683,132
|
|
|
|
|
6,630
|
|
|
—
|
|
|
|
|
39.665
|
|
|
11/08/2023
|
|
7,167
|
|
|
(6
|
)
|
|
489,649
|
|
|
10,750
|
|
|
(10
|
)
|
|
856,869
|
|
|
|
|
5,333
|
|
|
2,667
|
|
|
(3
|
)
|
|
48.565
|
|
|
10/23/2024
|
|
17,950
|
|
|
(7
|
)
|
|
1,226,344
|
|
|
17,950
|
|
|
(11
|
)
|
|
1,226,344
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
Stock Awards
|
||||||||||||||||||||||||||||
|
|
|
|
Restricted Stock
|
|
Performance Shares
|
||||||||||||||||||||||||||
|
|
Number of Securities Underlying Unexercised Options (#) Exercisable
|
|
Number of Securities Underlying Unexercised Options (#) Unexercisable
|
|
Option Exercise Price ($)(1)
|
|
Option Expiration Date
|
|
Number of Shares or Units of Stock That Have Not Vested (#)
|
|
Market Value of Shares or Units of Stock That Have Not Vested (#)(2)
|
|
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested ($) (2)
|
|
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(2)
|
||||||||||||||||
Jay D. Browning
|
|
3,922
|
|
|
—
|
|
|
|
|
17.743
|
|
|
11/17/2020
|
|
854
|
|
|
(4
|
)
|
|
58,345
|
|
|
2,793
|
|
|
(8
|
)
|
|
381,636
|
|
|
|
|
7,846
|
|
|
—
|
|
|
|
|
24.582
|
|
|
10/28/2021
|
|
2,661
|
|
|
(5
|
)
|
|
181,800
|
|
|
6,113
|
|
|
(9
|
)
|
|
626,494
|
|
|
|
|
8,378
|
|
|
—
|
|
|
|
|
27.318
|
|
|
11/09/2022
|
|
3,987
|
|
|
(6
|
)
|
|
272,392
|
|
|
10,300
|
|
|
(10
|
)
|
|
821,001
|
|
|
|
|
6,980
|
|
|
—
|
|
|
|
|
39.665
|
|
|
11/08/2023
|
|
7,784
|
|
|
(7
|
)
|
|
531,803
|
|
|
13,410
|
|
|
(11
|
)
|
|
916,171
|
|
|
|
|
5,093
|
|
|
2,547
|
|
|
(3
|
)
|
|
48.565
|
|
|
10/23/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Gary K. Simmons
|
|
—
|
|
|
1,750
|
|
|
(3
|
)
|
|
48.565
|
|
|
10/23/2024
|
|
845
|
|
|
(4
|
)
|
|
57,730
|
|
|
2,043
|
|
|
(8
|
)
|
|
279,156
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,134
|
|
|
(5
|
)
|
|
214,115
|
|
|
4,166
|
|
|
(9
|
)
|
|
426,932
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
4,667
|
|
|
(6
|
)
|
|
318,849
|
|
|
7,000
|
|
|
(10
|
)
|
|
557,969
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
9,090
|
|
|
(7
|
)
|
|
621,029
|
|
|
9,090
|
|
|
(11
|
)
|
|
621,029
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Our equity plans provide that the exercise price for all stock options must not be less than the mean of our Common Stock’s high and low NYSE reported sales price per share on the date of grant.
|
(2)
|
The assumed market values were determined using the closing market price of our Common Stock on 12/30/2016 ($68.32 per share). For a further discussion of the vesting of performance share awards (as noted in the following footnotes), see “Compensation Discussion and Analysis—Elements of Executive Compensation—Long-Term Incentive Awards—Performance Shares.” For performance shares that vested in January 2017, the payout value used for this column was their actual performance share vesting percentage on 01/26/2017 (
i.e
., 200% for the tranche of performance shares awarded in 2013, 200% for the tranche of performance shares awarded in 2014, and 150% for the tranche of performance shares awarded in 2015).
|
(3)
|
The unvested portion of this award is scheduled to vest on 10/23/2017.
|
(4)
|
The unvested portion of this award is scheduled to vest on 05/01/2017.
|
(5)
|
The unvested portion of this award is scheduled to vest on 10/23/2017.
|
(6)
|
The unvested portion of this award is scheduled to vest in equal installments on 11/04/2017 and 11/04/2018.
|
(7)
|
The unvested portion of this award is scheduled to vest in equal installments on 11/02/2017, 11/02/2018, and 11/02/2019.
|
(8)
|
These performance shares vested on 01/26/2017 at 200% of target. The value shown in the column, “Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested,” represents the market value of 200% (the actual payout amount) of the performance shares at the closing price of our Common Stock on 12/30/2016.
|
(9)
|
One-half of these performance shares vested on 01/26/2017 at 200% of target; the other one-half is scheduled to vest in January 2018. The value shown in the column, “Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested,” represents, for the performance shares that vested in January 2017, the market value of 200% (the actual payout amount) of the closing price of our Common Stock on 12/30/2016, and for the remaining one-half, the market value of 100% (assumed) of the closing price of our Common Stock on 12/30/2016.
|
(10)
|
One-third of these performance shares vested on 01/26/2017 at 150% of target; an additional one-third is scheduled to vest in January 2018, and the final one-third is scheduled to vest in January 2019. The value shown in the column, “Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested,” represents, for the performance shares that vested in January 2017, the market value of 150% (the actual payout amount) of the closing price of our Common Stock on 12/30/2016, and for the remaining two-thirds, the market value of 100% (assumed) of the closing price of our Common Stock on 12/30/2016.
|
(11)
|
These performance shares are scheduled to vest in one-third increments in each of January 2018, January 2019, and January 2020. The value shown in the column, “Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested,” represents the market value of 100% (assumed) of the performance shares at the closing price of our Common Stock on 12/30/2016.
|
|
|
Option Awards
|
|
Stock Awards (1)
|
|||||||||
Name
|
|
No. of Shares Acquired on Exercise (#)(2)
|
|
Value Realized on Exercise ($)(3)
|
|
No. of Shares Acquired on Vesting (#)(2)
|
|
Value Realized on Vesting ($)(4)
|
|||||
Joseph W. Gorder
|
|
—
|
|
|
—
|
|
|
|
|
|
|||
(5)
|
|
|
|
|
|
44,392
|
|
|
2,555,406
|
|
|||
(6)
|
|
|
|
|
|
91,450
|
|
|
5,863,317
|
|
|||
Michael S. Ciskowski
|
|
—
|
|
|
—
|
|
|
|
|
|
|||
(5)
|
|
|
|
|
|
18,670
|
|
|
1,072,649
|
|
|||
(6)
|
|
|
|
|
|
58,944
|
|
|
3,779,195
|
|
|||
R. Lane Riggs
|
|
8,560
|
|
|
362,276
|
|
|
|
|
|
|||
(5)
|
|
|
|
|
|
14,271
|
|
|
821,367
|
|
|||
(6)
|
|
|
|
|
|
18,385
|
|
|
1,178,754
|
|
|||
Jay D. Browning
|
|
—
|
|
|
—
|
|
|
|
|
|
|||
(5)
|
|
|
|
|
|
7,937
|
|
|
456,679
|
|
|||
(6)
|
|
|
|
|
|
18,561
|
|
|
1,190,039
|
|
|||
Gary K. Simmons
|
|
16,432
|
|
|
539,316
|
|
|
|
|
|
|||
(5)
|
|
|
|
|
|
9,375
|
|
|
539,269
|
|
|||
(6)
|
|
|
|
|
|
13,487
|
|
|
864,719
|
|
(1)
|
Represents shares of Common Stock from the vesting of restricted stock and performance shares in 2016.
|
(2)
|
Represents the gross number of shares received by the named executive officer before deducting any shares withheld from (i) an option’s exercise to pay the exercise price and/or tax obligation, or (ii) the vesting of restricted stock or performance shares to pay the resulting tax obligation.
|
(3)
|
The reported value is determined by multiplying (i) the number of option shares, times (ii) the difference between the market price of the Common Stock on the date of exercise and the exercise price of the stock option. The value is stated before payment of applicable taxes.
|
(4)
|
The reported value is determined by multiplying number of vested shares by the market value of the shares on the vesting date. The value is stated before payment of applicable taxes.
|
(5)
|
Represents number of shares of Common Stock and value related to vesting of restricted stock.
|
(6)
|
Represents number of shares of Common Stock and value related to vesting of performance shares.
|
Name
|
|
Plan Name
|
|
No. of Years Credited Service (#) (1)
|
|
Present Value of Accumulated Benefits ($)
|
|
Payments During Last Fiscal Year ($)
|
|||
Joseph W. Gorder (2)
|
|
Pension Plan
|
|
26.17
|
|
|
889,923
|
|
|
—
|
|
|
|
Excess Pension Plan
|
|
14.67
|
|
|
5,201,525
|
|
|
—
|
|
|
|
SERP
|
|
14.67
|
|
|
8,152,212
|
|
|
—
|
|
Michael S. Ciskowski
|
|
Pension Plan
|
|
31.25
|
|
|
1,376,382
|
|
|
—
|
|
|
|
Excess Pension Plan
|
|
31.25
|
|
|
9,639,862
|
|
|
—
|
|
|
|
SERP
|
|
31.25
|
|
|
4,550,952
|
|
|
—
|
|
R. Lane Riggs
|
|
Pension Plan
|
|
27.92
|
|
|
898,951
|
|
|
—
|
|
|
|
Excess Pension Plan
|
|
27.92
|
|
|
2,328,724
|
|
|
—
|
|
|
|
SERP
|
|
27.92
|
|
|
2,692,537
|
|
|
—
|
|
Jay D. Browning
|
|
Pension Plan
|
|
23.29
|
|
|
992,240
|
|
|
—
|
|
|
|
Excess Pension Plan
|
|
23.29
|
|
|
2,638,439
|
|
|
—
|
|
|
|
SERP
|
|
23.29
|
|
|
2,493,841
|
|
|
—
|
|
Gary K. Simmons
|
|
Pension Plan
|
|
29.52
|
|
|
1,004,841
|
|
|
—
|
|
|
|
Excess Pension Plan
|
|
29.52
|
|
|
2,190,504
|
|
|
—
|
|
|
|
SERP
|
|
29.52
|
|
|
2,012,526
|
|
|
—
|
|
(1)
|
The years of credited service for each of our NEOs include two years of service in our plans’ “Cash Balance Provision,” which commenced on January 1, 2015. The remainder of the NEOs’ years of service is in the “Formula Provision” of our plans. The Formula Provision and the Cash Balance Provision are described in the narrative disclosures that follow this table.
|
(2)
|
The 26.17 years of service stated for Mr. Gorder for the Pension Plan represent the sum of his participation in (a) the Valero Pension Plan since 2002 (14.67 years), and (b) the qualified pension plan of UDS (11.5 years). In 2001, Mr. Gorder received a lump sum settlement relating to prior years of service. The Pension Plan amount stated above reflects the effect of offsetting Mr. Gorder’s accrued benefit under the Valero Pension Plan by the value of his lump sum settlement in 2001. In addition, Mr. Gorder has approximately three years of service in a pension plan sponsored by an entity unaffiliated with Valero or UDS that was spun-off from a predecessor of UDS. The 14.67 years of service stated for Mr. Gorder for the Excess Pension Plan and SERP represent his participation since the date of his commencement of employment with Valero.
|
years of service
|
|
pay credits
|
under 10 years
|
|
5%
|
10 to 19 years
|
|
6%
|
20 years and over
|
|
7%
|
|
|
|
|
Executive
Contribu-
tions in
Last FY ($)
|
|
Registrant
Contribu-
tions in Last
FY ($) (1)
|
|
Aggregate
Earnings in
Last FY ($)
|
|
Aggregate
Withdraw-
als/Distri-
butions ($)
|
|
Aggregate
Balance
at Last
FYE ($)
|
|||||
Joseph W. Gorder
|
|
Deferred Compensation Plan
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Excess Thrift Plan
|
|
—
|
|
|
82,950
|
|
|
—
|
|
|
—
|
|
|
702,072
|
|
|
Michael S. Ciskowski
|
|
Deferred Compensation Plan
|
|
—
|
|
|
—
|
|
|
53,577
|
|
|
—
|
|
|
345,495
|
|
|
Excess Thrift Plan
|
|
—
|
|
|
43,750
|
|
|
—
|
|
|
—
|
|
|
1,373,070
|
|
|
R. Lane Riggs
|
|
Deferred Compensation Plan
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Excess Thrift Plan
|
|
—
|
|
|
26,250
|
|
|
—
|
|
|
—
|
|
|
185,118
|
|
|
|
|
UDS Non-qualified 401(k) Plan
(2)
|
|
—
|
|
|
—
|
|
|
1,809
|
|
|
—
|
|
|
42,197
|
|
Jay D. Browning
|
|
Deferred Compensation Plan
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Excess Thrift Plan
|
|
—
|
|
|
23,000
|
|
|
—
|
|
|
—
|
|
|
348,862
|
|
|
Gary K. Simmons
|
|
Deferred Compensation Plan
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Excess Thrift Plan
|
|
—
|
|
|
21,000
|
|
|
—
|
|
|
—
|
|
|
146,241
|
|
|
|
|
UDS Non-qualified 401(k) Plan
(2)
|
|
—
|
|
|
—
|
|
|
10,749
|
|
|
—
|
|
|
90,677
|
|
(1)
|
All of the amounts included in this column are also included within the amounts reported as “All Other Compensation” for 2016 in the Summary Compensation Table.
|
(2)
|
Valero assumed the UDS Non-qualified 401(k) Plan when Valero acquired UDS in 2001. This plan is frozen.
|
•
|
the acquisition by an individual, entity or group of beneficial ownership of 20 percent or more of our outstanding Common Stock;
|
•
|
the ouster from the Board of a majority of the incumbent directors;
|
•
|
consummation of a business combination (
e.g
., merger, share exchange); or
|
•
|
approval by stockholders of the liquidation or dissolution of Valero.
|
•
|
a diminution in the executive officer’s position, authority, duties and responsibilities;
|
•
|
relocation of the executive (or increased travel requirements); or
|
•
|
failure of Valero’s successor to assume and perform under the agreement.
|
Component of Payment
|
|
Gorder
|
|
Ciskowski
|
|
Riggs
|
|
Browning
|
|
Simmons
|
|||||
Salary (2)
|
|
4,350,000
|
|
|
2,670,000
|
|
|
1,280,000
|
|
|
1,190,000
|
|
|
1,130,000
|
|
Bonus (2)
|
|
11,700,000
|
|
|
5,577,000
|
|
|
1,024,000
|
|
|
1,840,000
|
|
|
734,500
|
|
Pension, Excess Pension, and SERP
|
|
7,670,177
|
|
|
5,557,322
|
|
|
—
|
|
|
1,396,301
|
|
|
—
|
|
Contributions under Defined Contribution Plans
|
|
304,500
|
|
|
186,900
|
|
|
—
|
|
|
83,100
|
|
|
—
|
|
Health & Welfare Plan Benefits (3)
|
|
61,641
|
|
|
41,448
|
|
|
49,820
|
|
|
53,108
|
|
|
49,820
|
|
Outplacement Services
|
|
25,000
|
|
|
25,000
|
|
|
25,000
|
|
|
25,000
|
|
|
25,000
|
|
Accelerated Vesting of Stock Options (4)
|
|
288,502
|
|
|
114,065
|
|
|
52,687
|
|
|
50,316
|
|
|
34,571
|
|
Accelerated Vesting of Restricted Stock (4)
|
|
6,322,606
|
|
|
2,252,852
|
|
|
2,174,557
|
|
|
1,044,340
|
|
|
1,211,724
|
|
Accelerated Vesting of Performance Shares (5)
|
|
9,906,878
|
|
|
4,510,965
|
|
|
1,888,296
|
|
|
1,810,138
|
|
|
1,251,486
|
|
Component of Payment
|
|
Gorder
|
|
Ciskowski
|
|
Riggs
(7)
|
|
Browning
|
|
Simmons
(7)
|
|||||
Accelerated Vesting of Stock Options
(4)
|
|
288,502
|
|
|
114,065
|
|
|
52,687
|
|
|
50,316
|
|
|
34,571
|
|
Accelerated Vesting of Restricted Stock
(4)
|
|
6,322,606
|
|
|
2,252,852
|
|
|
2,174,557
|
|
|
1,044,340
|
|
|
1,211,724
|
|
Accelerated Vesting of Performance Shares
(5)
|
|
9,906,878
|
|
|
4,510,965
|
|
|
1,888,296
|
|
|
1,810,138
|
|
|
1,251,486
|
|
Component of Payment
|
|
Gorder
|
|
Ciskowski
|
|
Riggs
|
|
Browning
|
|
Simmons
|
|||||
Salary, Bonus, Pension, Excess Pension, SERP, Contributions under Defined Contribution Plans, Health & Welfare Benefits
|
|
(8
|
)
|
|
(8
|
)
|
|
(8
|
)
|
|
(8
|
)
|
|
(8
|
)
|
Accelerated Vesting of Stock Options (4)
|
|
288,502
|
|
|
114,065
|
|
|
—
|
|
|
50,316
|
|
|
—
|
|
Accelerated Vesting of Restricted Stock (4)
|
|
6,322,606
|
|
|
2,252,852
|
|
|
—
|
|
|
1,044,340
|
|
|
—
|
|
Vesting of Performance Shares (8)
|
|
1,736,694
|
|
|
1,275,261
|
|
|
—
|
|
|
381,636
|
|
|
—
|
|
(1)
|
If the officer’s employment is terminated by the company other than for “cause” or death or disability, or if the officer terminates his employment for “good reason,” the officer is generally entitled to receive the following:
|
(2)
|
We assumed each officer’s compensation at the time of each triggering event to be as stated below. The listed salary is the executive officer’s rate of pay as of December 31, 2016. The listed bonus amounts for Messrs. Gorder, Ciskowski, and Browning represent the highest bonus earned by the executive in any of fiscal years 2014, 2015, or 2016 (the three years prior to the assumed change of control). The listed bonus amounts for Messrs. Riggs and Simmons represent the target bonus in effect prior to the assumed change of control.
|
Name
|
|
Salary
|
|
Bonus
|
Joseph W. Gorder
|
|
$1,450,000
|
|
$3,900,000
|
Michael S. Ciskowski
|
|
$890,000
|
|
$1,859,000
|
R. Lane Riggs
|
|
$640,000
|
|
$512,000
|
Jay D. Browning
|
|
$595,000
|
|
$920,000
|
Gary K. Simmons
|
|
$565,000
|
|
$367,250
|
(3)
|
The executive is entitled to coverage under welfare benefit plans (
e.g
., health, dental, etc.) for two years (
three
years
for Messrs. Gorder and Ciskowski) following the date of termination.
|
(4)
|
For Messrs. Gorder, Ciskowski, and Browning, upon a change of control of Valero, the vesting periods on outstanding stock options and shares of restricted stock are automatically accelerated to the date of the change of control. For Messrs. Riggs and Simmons, the vesting periods on outstanding stock options and shares of restricted stock are accelerated following a change of control upon the executive’s termination of employment other than (i) for cause, or (ii) voluntary termination by the executive other than for “good reason” or retirement. For stock options, the amounts stated in the table represent the assumed cash value of the accelerated options derived by multiplying (a) the difference between $68.32 (the closing price of Common Stock on the NYSE on December 30, 2016), and the options’ exercise prices, times (b) the number of option shares. For shares of restricted stock, the amounts stated in the table represent the product of (a) the number of shares whose restrictions lapsed, and (b) $68.32 (the closing price of Common Stock on the NYSE on December 30, 2016).
|
(5)
|
Performance shares granted in 2014 and thereafter do not vest automatically upon the date of a change of control of Valero. Instead, for these performance shares, if an executive’s employment with Valero is terminated following a change of control, the unvested performance shares held by the executive will vest on a partial,
pro rata
basis on the date of his termination of employment. Automatic acceleration of the vesting of performance shares upon a change of control of Valero was possible only for the final tranche of the outstanding performance shares awarded in 2013. (This final tranche of the 2013 performance shares vested on January 26, 2017, and the performance shares are no longer outstanding.)
|
(6)
|
If employment is terminated by reason of death or disability, the officer’s estate will be entitled to receive a lump sum cash payment equal to any accrued and unpaid salary and vacation pay plus a bonus amount earned per the terms of the agreement. In the case of disability, the officer would be entitled to disability and related benefits at least as favorable as those provided by Valero under its programs during the 120 days prior to the officer’s termination of employment.
|
(7)
|
If the officer voluntarily terminates employment other than for “good reason,” he will be entitled to a lump sum cash payment equal to any accrued and unpaid salary and vacation pay plus a bonus amount earned per the terms of the agreement (prorated to the date of termination; in this example, we assumed that the officers’ bonuses for the year of termination were paid at year-end). In such an event for Mr. Riggs and Mr. Simmons, the restriction periods on their outstanding equity awards will not be accelerated, and they will not be entitled to the amounts stated in the table.
|
(8)
|
The agreements provide for a three-year term of employment following a change of control, and generally provide that the officer will continue to enjoy compensation and benefits per the terms in effect prior to the change of control. In addition, for Messrs. Gorder, Ciskowski, and Browning, all outstanding (i) stock options, (ii) shares of restricted stock, and (iii) performance shares awarded before 2014 will vest on the date of the change of control (see footnotes (4) & (5) above).
|
|
|
Fees Earned or Paid in Cash ($)
|
|
Stock Awards ($)(1)
|
|
Total ($)
|
|||
Jerry D. Choate
(retired May 12, 2016)
|
|
60,000
|
|
|
—
|
|
|
60,000
|
|
H. Paulett Eberhart
|
|
60,000
|
|
|
141,680
|
|
|
201,680
|
|
Joseph W. Gorder
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
Kimberly S. Greene
|
|
60,000
|
|
|
141,680
|
|
|
201,680
|
|
Deborah P. Majoras
|
|
140,000
|
|
|
170,038
|
|
|
310,038
|
|
Donald L. Nickles
|
|
120,000
|
|
|
170,038
|
|
|
290,038
|
|
Philip J. Pfeiffer
|
|
120,000
|
|
|
170,038
|
|
|
290,038
|
|
Robert A. Profusek
|
|
145,000
|
|
|
170,038
|
|
|
315,038
|
|
Susan Kaufman Purcell
|
|
120,000
|
|
|
170,038
|
|
|
290,038
|
|
Stephen M. Waters
|
|
120,000
|
|
|
170,038
|
|
|
290,038
|
|
Randall J. Weisenburger
|
|
140,000
|
|
|
170,038
|
|
|
310,038
|
|
Rayford Wilkins, Jr.
|
|
140,000
|
|
|
170,038
|
|
|
310,038
|
|
(1)
|
The amounts shown represent the grant date fair value of awards granted in 2016, computed in compliance with FASB ASC Topic 718. In 2016, each of our non-employee directors who was re-elected to the Board on May 12, 2016 (the date of our 2016 annual stockholders meeting), received a grant of 3,069 shares of restricted Common Stock. Ms. Eberhart and Ms. Greene received a pro rata grant of 2,404 restricted shares in connection with their appointment to the Board as new directors in 2016. Valero did not grant stock options to any director in 2016. The following table presents for each non-employee director the number of unvested restricted shares of Common Stock held as of December 31, 2016. There are no outstanding stock options (vested or unvested) held by any of our non-employee directors.
|
Name
|
|
Unvested Restricted Stock
|
|
H. Paulett Eberhart
|
|
2,404
|
|
Kimberly S. Greene
|
|
2,404
|
|
Deborah P. Majoras
|
|
5,979
|
|
Donald L. Nickles
|
|
5,979
|
|
Philip J. Pfeiffer
|
|
5,979
|
|
Robert A. Profusek
|
|
5,979
|
|
Susan Kaufman Purcell
|
|
5,979
|
|
Stephen M. Waters
|
|
5,979
|
|
Randall J. Weisenburger
|
|
5,979
|
|
Rayford Wilkins, Jr.
|
|
5,979
|
|
(2)
|
Mr. Gorder did not receive any compensation as director of Valero in 2016. His compensation for service as an executive officer in 2016 is presented earlier in this proxy statement in the compensation tables for our named executive officers.
|
•
|
the payment to us by VLP of an annual administrative fee of $12.5 million for our provision of certain services to VLP;
|
•
|
VLP’s obligation to reimburse us for certain direct or allocated costs and expenses that we may incur on behalf of VLP;
|
•
|
VLP’s right of first offer through December 16, 2018, to acquire certain of our transportation and logistics assets;
|
•
|
our right of first refusal to acquire certain of VLP’s assets; and
|
•
|
the parties’ indemnification obligations to one another.
|
|
|
2016
|
|
2015
|
||||
Audit Fees
(1)
|
|
$
|
7.5
|
|
|
$
|
7.2
|
|
Audit-Related Fees
(2)
|
|
0.3
|
|
|
0.3
|
|
||
Tax Fees (3)
|
|
—
|
|
|
0.2
|
|
||
All Other Fees
(4)
|
|
0.3
|
|
|
0.1
|
|
||
total
|
|
$
|
8.1
|
|
|
$
|
7.8
|
|
(1)
|
Represents fees for professional services rendered for the audit of the annual financial statements included in Valero’s annual reports on Form 10-K, review of Valero’s interim financial statements included in Valero’s Forms 10-Q, the audit of the effectiveness of Valero’s internal control over financial reporting, and services that are normally provided by the principal auditor (
e.g.,
comfort letters, statutory audits, attest services, consents, and assistance with and review of documents filed with the SEC). In addition to the services listed above, KPMG served as the independent auditor of the financial statements included in the annual reports on Form 10-K of Valero Energy Partners LP (VLP) for the years ended December 31, 2016 and 2015, and the audit of the effectiveness of VLP’s internal control over financial reporting as of December 31, 2016 and December 31, 2015. KPMG’s fees relating to VLP audits for 2016 and 2015 were $2.075 million and $1.325 million, respectively.
|
(2)
|
Represents fees for assurance and related services that are reasonably related to the performance of the audit or review of Valero’s financial statements and not reported under the caption for Audit Fees. The fees listed above are related to the audit of Valero’s benefit plans.
|
(3)
|
Represents fees for professional services rendered by KPMG for tax compliance, tax advice, and tax planning services.
|
(4)
|
Represents fees for for professional services other than the services reported under the preceding captions. The fees shown were for advisory services.
|
•
|
Restated Certificate of Incorporation
|
•
|
Bylaws
|
•
|
Code of Business Conduct and Ethics
|
•
|
Code of Ethics for Senior Financial Officers
|
•
|
Corporate Governance Guidelines
|
•
|
Audit Committee Charter
|
•
|
Compensation Committee Charter
|
•
|
Nominating/Governance and Public Policy Committee Charter
|
•
|
Related Party Transactions Policy
|
•
|
Compensation Consultant Disclosures Policy
|
•
|
Policy on Executive Compensation in Restatement Situations
|
•
|
Policy on Political Contributions, Lobbying, and Trade Associations
|
•
|
Policy on Vesting of Performance Shares
|
|
VALERO ENERGY CORPORATION
|
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
|
ANNUAL MEETING OF STOCKHOLDERS
|
MAY 3, 2017
|
|
The stockholder(s) hereby revoke(s) all previous proxies and appoint(s) Joseph W. Gorder, Jay D. Browning and J. Stephen Gilbert, or any of them, as proxies, each with the power to appoint his substitute, and hereby authorizes them to represent and to vote, as designated on the reverse side of this ballot, all of the shares of Common Stock of Valero Energy Corporation that the stockholder(s) is/are entitled to vote at the Annual Meeting of Stockholders to be held on Wednesday, May 3, 2017 at 10:00 a.m., Central Time, at the Valero Energy Corporation offices located at One Valero Way, San Antonio, TX 78249, and any adjournment or postponement thereof.
|
|
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS SPECIFIED ON THE REVERSE SIDE. IF NO SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED “FOR” ALL NOMINEES FOR DIRECTOR, “FOR” PROPOSALS 2 AND 3, AND FOR “1 YEAR” ON PROPOSAL 4. IF ANY OTHER MATTERS ARE VOTED ON AT THE MEETING, THIS PROXY WILL BE VOTED BY THE NAMED PROXIES ON SUCH MATTERS IN THEIR SOLE DISCRETION.
|
|
YOUR TELEPHONE OR INTERNET VOTE AUTHORIZES THE NAMED PROXIES TO VOTE THE SHARES IN THE SAME MANNER AS IF YOU MARKED, SIGNED AND RETURNED YOUR PROXY CARD.
|
|
|
|
|
Continued and to be signed on reverse side
|
1 Year Valero Energy Chart |
1 Month Valero Energy Chart |
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