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¨
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Preliminary Proxy Statement
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¨
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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ý
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Definitive Proxy Statement
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¨
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Definitive Additional Materials
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¨
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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)(4) and 0-11.
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(1
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Title of each class of securities to which transaction applies:
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(2
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Aggregate number of securities to which transaction applies:
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(3
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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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(4
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Proposed maximum aggregate value of transaction:
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(5
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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 0-11(a)(2) 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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(1
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Amount Previously Paid:
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(2
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Form, Schedule or Registration Statement No:
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(3
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Filing Party:
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(4
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Date Filed:
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James B. Nicholson
|
Gerard M. Anderson
|
Lead Independent Director
|
Chairman and Chief Executive Officer
|
Meeting Date:
|
Time:
|
Location:
|
Thursday, May 9, 2019
|
8:00 a.m. Mountain Standard Time
|
Arizona Biltmore Hotel 2400 East Missouri Avenue Phoenix, Arizona 85016
|
1.
|
Elect eleven directors;
|
2.
|
Ratify the appointment of PricewaterhouseCoopers LLP by the Audit Committee of the Board of Directors as our independent registered public accounting firm for the year 2019;
|
3.
|
Provide an advisory vote to approve executive compensation;
|
4.
|
Vote on shareholder proposals, if properly presented, to require an independent board chairman and to require additional disclosure of political contributions; and
|
5.
|
Consider any other business that may properly come before the meeting.
|
By Order of the Board of Directors
|
||
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Lisa A. Muschong
Vice President, Corporate Secretary & Chief of Staff
March 14, 2019
|
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DTE ENERGY
2019 PROXY STATEMENT
1
|
Every spring we reach out to large shareholders to discuss issues related to proxy season and the proposals to be presented at our annual meeting. In the fall we conduct another round of conversations to discuss general governance issues and trends. We also discuss pressing matters on an ad hoc basis.
|
|
Our shareholder engagement activities help us identify governance and compensation policies and practices that are most important to our shareholders.
|
||
The shareholder engagement team reports directly to the Corporate Governance Committee and other committees as needed, conveying the feedback received from shareholders and proposing implementation of best practices.
|
The committees and the full Board of Directors deliberate over proposed governance changes, adopt best practices and provide guidance to the shareholder engagement team in their communications with shareholders.
|
•
|
Ten of eleven director nominees, 91%, are independent; our Chairman & Chief Executive Officer ("CEO") is the only management director.
|
•
|
All Board committees are composed exclusively of independent directors.
|
•
|
We have implemented a proxy access provision, which makes it possible for a group of shareholders meeting certain criteria to nominate and include in the Company’s proxy materials a candidate for the Board.
|
•
|
We have a Lead Independent Director, elected by the independent members of the Board. The Lead Independent Director maintains final approval authority over Board agendas, meeting materials and schedules. The Lead Independent Director is also available for consultation and direct communication with large shareholders.
|
•
|
Independent directors met in executive sessions chaired by the Lead Independent Director at six of the seven 2018 Board meetings.
|
•
|
All of our directors are elected annually.
|
•
|
We have a majority vote requirement for uncontested director elections.
|
•
|
The Board and its committees conduct annual self-assessments. In addition, each independent director who has served for one year or more undergoes an annual peer review.
|
•
|
Our executive officers and directors are all subject to robust stock ownership requirements.
|
•
|
We have instituted anti-hedging policies applicable to all Company directors, officers and employees.
|
2
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
Our Board’s Mission and Governance Guidelines recommend that the Board consider diversity of characteristics including experience, gender, race, ethnicity and age when evaluating nominees for the Board.
|
•
|
We limit our directors who are CEOs of public companies to a total of not more than three public company boards and all other directors to a total of not more than four public company boards.
|
•
|
Achieved 9.0% compound operating earnings per share growth during the five years ending in 2018 (see discussion of operating earnings on page 39 ).
|
•
|
Increased our dividend payment to $3.60 per share in 2018, representing a 7% increase over the dividend in 2017.
|
•
|
Provided our shareholders with a five-year total shareholder return of 196% (indexed with 2013 as the base year = 100%).
|
•
|
Delivered cash from operations of 2.7 billion in 2018.
|
•
|
Ranked second in residential customer satisfaction in the Midwest from J.D. Power for both electric and gas utilities.
|
•
|
Received Gallup Great Workplace Award for the sixth consecutive year.
|
|
2016
|
2017
|
2018
|
CEO Total Compensation ($000s)
|
12,499
|
15,836
|
10,987
|
Total Shareholder Return (Indexed, Base Period 2013=100)
|
164.41
|
188.40
|
196.30
|
|
DTE ENERGY
2019 PROXY STATEMENT
3
|
•
|
Our CEO received 67% of his 2018 total compensation in contingent, performance-based incentives. For our other Named Executive Officers, the average percentage of contingent, performance-based compensation was 57%. See more details on page 33.
|
•
|
Our short-term and long-term performance metrics all tie directly to our system of priorities (see above). These are the same metrics that management uses to assess the Company’s progress toward our aspiration of becoming the best-operated energy company in North America and a force for growth and prosperity in the communities where we live and serve.
|
•
|
Our long-term plan awards include a mix of restricted stock and performance shares designed in part to encourage executive stock ownership. The Board’s Organization and Compensation Committee has not issued stock options since 2010.
|
•
|
Our equity compensation plan forbids buyouts of “underwater” stock options. The Company has never bought or repriced “underwater” stock options.
|
•
|
Our equity compensation plan requires a minimum one-year vesting period for equity awards. The Company’s typical practice is to require a three-year vesting period for equity awards and the Company has never issued equity awards with less than a one-year vesting period.
|
•
|
Our Board has adopted a “clawback” policy that provides that, in the event of an accounting restatement due to material noncompliance with federal securities laws, the Company may recover excess performance-based compensation awarded to current or former officers during the three-year period preceding the restatement.
|
•
|
Our executive Change-In-Control Severance Agreements do not include excise tax gross-ups.
|
•
|
We have eliminated the automatic vesting of equity issued under our Long-Term Incentive Plan upon a change in control of the Company, unless an acquiring or surviving entity fails to replace or affirm the existing equity awards with awards by the surviving company.
|
4
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
5
|
|
|
|
|
|
Gerard M. Anderson
Chairman (2011–present) and CEO (2010–present), DTE Energy Company
|
|||
|
||||
Previous Experience
|
||||
•
|
DTE Energy Company–President (2004–2013), COO (2005–2010), Executive VP (1997–2004)
|
|||
•
|
McKinsey & Co.–Senior Consultant (1988–1993)
|
|||
Not Independent
|
Other Public Boards
|
|||
Age: 60
|
•
|
The Andersons, Inc. (2008–present)
|
||
Director since: 2009
|
Qualifications for DTE Energy Company Board of Directors
|
|||
|
•
|
Energy Industry Experience
|
||
|
|
DTE Energy Chief Operating Officer for 5 years prior to becoming CEO
|
||
|
|
•
|
Growth and Value Creation
|
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Extensive experience in strategic planning and corporate business development
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•
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Operations and Continuous Improvement
|
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Broad experience managing capital-intensive industries
|
6
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
David A. Brandon
Chairman and CEO, Toys "R" Us, Inc.* (2015–2018)
|
|||
|
||||
Previous Experience
|
||||
•
|
University of Michigan–Athletic Director (2010–2014)
|
|||
•
|
Domino’s Pizza, Inc.–Chairman and CEO (1999–2010)
|
|||
Independent
|
•
|
Valassis Communications, Inc. (a marketing and sales promotion firm)–President
and CEO (1989–1998)
|
||
Age: 66
|
Other Public Boards
|
|||
Director since: 2010
|
•
|
Domino’s Pizza, Inc. (1999–present)
|
||
DTE Committees:
|
•
|
Herman Miller, Inc. (2011–present)
|
||
•
|
O&C (Chair)
|
•
|
Kaydon Corporation (2004–2013)
|
|
•
|
Finance
|
Qualifications for DTE Energy Company Board of Directors
|
||
|
|
•
|
CEO Experience
|
|
|
|
|
Service as chief executive of large public companies
|
|
|
|
•
|
Customer Service and Satisfaction
|
|
|
|
|
Extensive experience in marketing and sales
|
|
|
|
•
|
Financial Planning and Review
|
|
|
|
|
Strong skill sets in corporate finance and strategic planning
|
|
|
|
•
|
Executive Compensation
|
|
|
|
|
Experience in executive compensation and organizational best practices
|
|
* In September 2017, Toys "R" Us, Inc. filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code.
|
|
W. Frank Fountain, Jr.
President, Escambia Enterprises, LLC (an investment and consulting firm) (2012–present)
|
|||
|
||||
Previous Experience
|
||||
•
|
Walter P. Chrysler Museum Foundation–Chairman of Board of Directors (2009–2012)
|
|||
•
|
Chrysler, LLC–Senior VP of External Affairs and Public Policy (1998–2008) VP, Government Affairs (1995–1998)
|
|||
Independent
|
Qualifications for DTE Energy Company Board of Directors
|
|||
Age: 74
|
•
|
Corporate Governance
|
||
Director since: 2007
|
|
Experience as a leader of large business organizations
|
||
DTE Committees:
|
•
|
Government, Regulatory and Community
|
||
•
|
Audit
|
|
Strong skills in public policy, government relations and knowledge of regulatory matters
|
|
•
|
PPRC (Chair)
|
•
|
Financial Planning and Review
|
|
|
|
|
Extensive experience with public and financial accounting for complex organizations
|
|
DTE ENERGY
2019 PROXY STATEMENT
7
|
|
Charles G. McClure, Jr.
Managing Partner, Michigan Capital Advisors (a private equity firm)(2014–present)
|
|||
|
||||
Previous Experience
|
||||
•
|
Meritor, Inc.–Chairman of the Board, CEO and President (2004–2013)
|
|||
•
|
Federal-Mogul Corporation–CEO (2003–2004), President and COO (2001–2003)
|
|||
Independent
|
•
|
Detroit Diesel Corporation–President and CEO (1997–2000)
|
||
Age: 65
|
Other Public Boards
|
|||
Director since: 2012
|
•
|
Crane Co. (2017–present)
|
||
DTE Committees:
|
•
|
3D Systems Inc. (2017–present)
|
||
•
|
Audit
|
•
|
Remy International, Inc. (2015)
|
|
•
|
Corp Gov
|
•
|
Meritor, Inc. (2004–2013)
|
|
•
|
Nuc Rev
|
Qualifications for DTE Energy Company Board of Directors
|
||
|
|
•
|
CEO Experience
|
|
|
|
|
CEO, president and director of several major domestic and international corporations
|
|
|
|
•
|
Operations and Continuous Improvement
|
|
|
|
|
Broad knowledge of business and industry
|
|
|
|
•
|
Employee Engagement, Safety and Talent
|
|
|
|
|
Extensive proven leadership skills and service on boards of industry organizations
|
|
Gail J. McGovern
President and CEO, American Red Cross (2008–present)
|
|||
|
||||
Previous Experience
|
||||
•
|
Harvard Business School–Professor (2002–2008)
|
|||
•
|
Fidelity Personal Investments (a unit of Fidelity Investments)–President (1998–2002)
|
|||
Independent
|
Other Public Boards
|
|||
Age: 67
|
•
|
PayPal Holdings, Inc. (2015–present)
|
||
Director since: 2003
|
•
|
eBay Inc. (2015)
|
||
DTE Committees:
|
Qualifications for DTE Energy Company Board of Directors
|
|||
•
|
O&C
|
•
|
CEO Experience
|
|
•
|
Finance
|
|
Top executive of major non-profit organization
|
|
|
|
•
|
Customer Service and Satisfaction
|
|
|
|
|
Extensive executive experience in marketing, sales and customer relations
|
|
|
|
•
|
Growth and Value Creation
|
|
|
|
|
Experience in strategic planning and corporate finance
|
8
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
Mark A. Murray
Vice Chairman, Meijer, Inc. (2013–present)
|
|||
|
||||
Previous Experience
|
||||
•
|
Meijer, Inc.–President (2006–2013), Co-CEO (2013–2016)
|
|||
•
|
Grand Valley State University–President (2001–2006)
|
|||
Independent
|
•
|
State of Michigan–Treasurer (1999–2001)
|
||
Age: 64
|
•
|
Michigan State University–VP of Finance and Administration (1998–1999)
|
||
Director since: 2009
|
Other Public Boards
|
|||
DTE Committees:
|
•
|
Universal Forest Products, Inc. (2004–2016)
|
||
•
|
Nuc Rev (Chair)
|
•
|
Fidelity Fixed Income and Asset Allocation (2016–present)
|
|
•
|
PPRC
|
Qualifications for DTE Energy Company Board of Directors
|
||
|
|
•
|
CEO Experience
|
|
|
|
|
President and Co-CEO of a major Michigan-based corporation
|
|
|
|
•
|
Financial Planning and Review
|
|
|
|
|
Strategic planning, corporate development and finance experience
|
|
|
|
•
|
Government, Regulatory and Community
|
|
|
|
|
University president and state government official
|
|
Ruth G. Shaw
Retired Group Executive, Public Policy and President, Duke Nuclear, Duke Energy (2003–2009)
|
|||
|
||||
Previous Experience
|
||||
•
|
Duke Energy–Executive Advisor (2007–2009)
|
|||
•
|
Duke Nuclear–Group Executive for Public Policy and President (2006–2007)
|
|||
Independent
|
•
|
Duke Power Company–President and CEO (2003–2006)
|
||
Age: 71
|
Other Public Boards
|
|||
Director since: 2008
|
•
|
Dow DuPont, Inc. (2017–present)
|
||
DTE Committees:
|
•
|
The Dow Chemical Company (2005–2017)
|
||
•
|
Corp Gov (Chair)
|
•
|
SPX Corporation (2015–present)
|
|
•
|
O & C
|
Qualifications for DTE Energy Company Board of Directors
|
||
•
|
Nuc Rev
|
•
|
Energy Industry Experience
|
|
|
|
|
Extensive experience in the nuclear and energy industries
|
|
|
|
•
|
Corporate Governance
|
|
|
|
|
Service on corporate boards and industry associations and organizations
|
|
|
|
•
|
Government, Regulatory and Community
|
|
|
|
|
Broad knowledge of regulatory matters, public policy and corporate communications
|
|
DTE ENERGY
2019 PROXY STATEMENT
9
|
|
Robert C. Skaggs, Jr.
Retired Chairman and CEO, Columbia Pipeline Group, Inc. (2015–2016)
|
|||
|
||||
Previous Experience
|
||||
•
|
NiSource, Inc.–President (2004–2015) and CEO (2005–2015)
|
|||
Other Public Boards
|
||||
•
|
Cloud Peak Energy, Inc. (2015–present)
|
|||
Independent
|
•
|
Columbia Pipeline Group, Inc. (2015–2016)
|
||
Age: 64
|
•
|
NiSource, Inc. (2005–2015)
|
||
Director since: 2017
|
Qualifications for DTE Energy Company Board of Directors
|
|||
DTE Committees:
|
•
|
CEO Experience
|
||
•
|
Finance
|
|
Extensive executive leadership experience in the utility sector
|
|
•
|
Nuc Rev
|
•
|
Energy Industry Experience
|
|
|
|
|
Broad experience in natural gas and electric generation, transmission, storage and distribution
|
|
|
|
•
|
Government, Regulatory and Community
|
|
|
|
|
Experience developing regulatory strategies and leading external relations
|
|
David A. Thomas
President, Morehouse College (2018–present)
|
|||
|
||||
Previous Experience
|
||||
•
|
Harvard Business School–H. Naylor Fitzhugh Professor of Business Administration (2016–2017, 1990–2011)
|
|||
•
|
Georgetown University McDonough School of Business–Dean and William R. Berkeley Professor of Business Administration (2011–2016)
|
|||
Independent
|
•
|
Wharton School of Finance–Assistant Professor of Management (1986–1990)
|
||
Age: 62
|
Qualifications for DTE Energy Company Board of Directors
|
|||
Director since: 2013
|
•
|
Employee Engagement, Safety and Talent
|
||
Independent
|
|
Leadership and research in corporate inclusion and diversity
|
||
DTE Committees:
|
•
|
Corporate Governance
|
||
•
|
Finance
|
|
Service on various civic and educational boards, advisor to other corporate boards
|
|
•
|
PPRC
|
•
|
Executive Experience as senior level higher education administrator
|
|
|
|
|
Expertise in executive development and strategic human resource management
|
10
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
James H. Vandenberghe
Retired Vice Chairman and former Director, Lear Corporation (1998–2008)
|
|||
|
||||
Previous Experience
|
||||
•
|
Lear Corporation–President and COO (1997–1998), CFO (1988–1997, 2006–2007)
|
|||
Other Public Boards
|
||||
•
|
Lear Corporation (1995–2008)
|
|||
Independent
|
•
|
Federal-Mogul Corporation (2008–2013)
|
||
Age: 69
|
Qualifications for DTE Energy Company Board of Directors
|
|||
Director since: 2006
|
•
|
Growth and Value Creation
|
||
DTE Committees:
|
|
Extensive experience in strategic planning and managing capital-intensive industries
|
||
•
|
Audit
|
•
|
Financial Planning and Review
|
|
•
|
Corp Gov
|
|
Broad experience with public and financial accounting for complex organizations
|
|
•
|
Finance (Chair)
|
|
|
|
Valerie M. Williams
Retired Southwest Assurance Managing Partner, Ernst & Young LLP (2009–2016)
|
|||
|
||||
Previous Experience
|
||||
•
|
Ernst & Young, LLP–Southwest AABS Managing Partner (2006–2009)
|
|||
•
|
Ernst & Young, LLP–National Office Professional Practice Partner (2005)
|
|||
Independent
|
Other Public Boards
|
|||
Age: 62
|
•
|
Omnicom Group (2016–present)
|
||
Director since: 2018
|
•
|
WPX Energy, Inc. (2018–Present)
|
||
DTE Committees:
|
Qualifications for DTE Energy Company Board of Directors
|
|||
•
|
Audit (Chair)
|
•
|
Financial Planning and Review
|
|
|
|
Significant financial reporting expertise for complex organizations
|
||
|
|
•
|
Corporate Governance
|
|
|
|
|
Leadership experience in audit practice and risk management
|
|
|
|
•
|
Growth and Value Creation
|
|
|
|
|
Experience in oversight of operations and strategy development
|
|
|
|
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
11
|
12
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
A director who is currently, or has been at any time in the past, an employee of the Company or a subsidiary.
|
•
|
A director whose immediate family member is, or has been within the last three years, an executive officer of the Company.
|
•
|
A director who receives, or whose immediate family member receives, more than $120,000 in direct compensation from the Company during any twelve-month period within the last three years, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service).
|
•
|
A director who is, or whose immediate family member is, a current partner of a firm that is the Company’s internal or external auditor; the director is a current employee of such a firm; the immediate family member is a current employee of such a firm and personally works on the Company’s audit; or the director or immediate family member was, within the last three years, a partner or employee of such a firm and personally worked on the Company’s audit within that time.
|
•
|
A director who is employed, or whose immediate family member is employed, or has been employed within the last three years, as an executive officer of another company where any of the Company’s present executives at the same time serves or served on that company’s compensation committee.
|
•
|
A director who is a current employee, or whose immediate family member is a current executive officer, of a company that has made payments to, or received payments from, the Company for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million or 2% of such other company’s consolidated gross revenues is not independent until three years after the company falls below such threshold.
|
|
DTE ENERGY
2019 PROXY STATEMENT
13
|
•
|
Calling regularly scheduled executive sessions; presiding at Board executive sessions of non-management directors or independent directors; and providing feedback regarding such sessions, as appropriate, to the Chairman and CEO;
|
•
|
Serving as the liaison between the Chairman and CEO and the independent directors;
|
•
|
Approving the general scope and type of information to be presented at Board meetings;
|
•
|
Reviewing shareholder communications addressed to the Board or to the Lead Independent Director;
|
14
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
Making himself or herself available if requested by major shareholders, for direct consultation and communication with shareholders;
|
•
|
Organizing Board meetings in the absence of the Chairman and presiding at any session of the Board where the Chairman is not present;
|
•
|
Designating one or more directors as alternate members of any committee to replace an absent or disqualified member at any committee meeting, provided that, in the event an alternate member is designated for the Audit, Corporate Governance or Organization and Compensation Committee, the designate meets the Company’s categorical standards for director independence and SEC and NYSE requirements;
|
•
|
Consulting with the Chairman and CEO in the selection of topics to be discussed when developing the annual Board calendar;
|
•
|
Retaining independent advisors in consultation with the Board, on behalf of the Board as the Board determines to be necessary or appropriate;
|
•
|
Participating in the Organization and Compensation Committee’s annual review and approval of the CEO’s corporate goals and objectives and evaluation of the CEO’s performance;
|
•
|
Approving Board meeting agendas after consulting with the Chairman and CEO and the Corporate Secretary; and
|
•
|
Collaborating with the Chairman and CEO and the Corporate Secretary on scheduling Board and committee meetings and approving the schedule of Board and Committee meetings.
|
|
DTE ENERGY
2019 PROXY STATEMENT
15
|
By telephone:
|
By Internet:
|
By mail:
|
|
877-406-9448
|
ethicsinaction.dteenergy.com
|
For auditing, accounting, or
internal control matters:
|
For business ethics issues:
|
|
|
DTE Energy Company
|
DTE Energy Company
|
|
|
Audit Committee
|
Ethics and Employee Issues
|
|
|
One Energy Plaza
|
One Energy Plaza
|
|
|
Room 2431 WCB
|
Room 2188 WCB
|
|
|
Detroit, Michigan 48226-1279
|
Detroit, Michigan 48226-1279
|
Lead Independent Director
|
c/o Corporate Secretary
|
DTE Energy Company
|
One Energy Plaza
|
Room 2386 WCB
|
Detroit, Michigan 48226-1279
|
16
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
Assists the Board in its oversight of the quality and integrity of our accounting, auditing and financial reporting practices and the independence of the independent registered public accounting firm.
|
•
|
Reviews scope of the annual audit and the annual audit report of the independent registered public accounting firm.
|
•
|
Reviews financial reports, internal controls and financial and accounting risk exposures.
|
•
|
Discusses with management (a) earnings press releases and (b) material financial information and earnings guidance.
|
•
|
Reviews the policies, programs, performance and activities relating to the Company’s compliance and ethics programs.
|
•
|
Reviews accounting policies and system of internal controls.
|
•
|
Assumes responsibility for the appointment, replacement, compensation and oversight of the independent registered public accounting firm.
|
•
|
Reviews and pre-approves permitted non-audit functions performed by the independent registered public accounting firm.
|
•
|
Reviews the scope of work performed by the internal audit staff.
|
•
|
Reviews legal or regulatory requirements or proposals that may affect the committee’s duties or obligations.
|
•
|
Retains independent outside professional advisors, as needed.
|
•
|
Considers the organizational structure of the Board.
|
•
|
Identifies and reports to the Board risks associated with the Company’s governance practices and the interaction of the Company’s governance with enterprise risk management.
|
•
|
Recommends the nominees for directors to the Board.
|
•
|
Reviews recommended compensation arrangements for the Board, director and officer indemnification and insurance for the Board.
|
•
|
Reviews recommendations for director nominations received from shareholders.
|
•
|
Reviews shareholder proposals and makes recommendations to the Board regarding the Company’s response.
|
•
|
Reviews best practices in corporate governance and recommends corporate and Board policies/practices, as appropriate.
|
•
|
Retains independent outside professional advisors, as needed.
|
•
|
Reviews matters related to capital structure.
|
•
|
Reviews major financing plans.
|
•
|
Recommends dividend policy to the Board.
|
•
|
Reviews financial planning policies and investment strategy.
|
•
|
Reviews certain capital expenditures.
|
•
|
Reviews insurance and business risk management.
|
•
|
Receives reports on the strategy, investment policies, adequacy of funding and performance of post-retirement obligations.
|
•
|
Reviews certain potential mergers, acquisitions and divestitures.
|
•
|
Reviews investor relations activities.
|
•
|
Retains independent outside professional advisors, as needed.
|
|
DTE ENERGY
2019 PROXY STATEMENT
17
|
•
|
Provides non-management oversight and review of the Company’s nuclear power program.
|
•
|
Reviews the financial, operational and business and safety plans and performance at the Company’s nuclear facilities.
|
•
|
Reviews the policies, procedures and practices related to health and safety, potential risks, resources and compliance at the Company’s nuclear facilities.
|
•
|
Reviews the operating performance and key performance indicators and trends for the Company’s nuclear facilities.
|
•
|
Reviews non-financial audit findings related to the Company’s nuclear facilities or personnel.
|
•
|
Reviews the impact of changes in regulation on the Company’s nuclear facilities.
|
•
|
Retains independent outside professional advisors, as needed.
|
•
|
Reviews the CEO’s performance and approves the CEO’s compensation.
|
•
|
Approves the compensation of certain other executives.
|
•
|
Administers the executive incentive plans and oversees the Company’s overall executive compensation and benefit plan philosophy, structure and practices, and the risks involved in executive compensation plans.
|
•
|
Reviews and approves executive employment agreements, severance agreements and change-in-control agreements, along with any amendments to those agreements.
|
•
|
Assesses and discusses with the Board the relationship between the inherent risk in executive compensation plans, executive compensation arrangements and executive performance goals and payouts, and how the level of risk corresponds to the Company’s business strategies.
|
•
|
Reviews the Compensation Disclosure and Analysis disclosure and recommends inclusion in the Company’s annual report or proxy statement.
|
•
|
Reviews the Company’s policies and programs promoting diversity and inclusion among the Company’s employees and officers.
|
•
|
Recommends to the full Board the officers to be elected by the Board.
|
•
|
Reviews succession and talent planning.
|
•
|
Evaluates the independence of the independent compensation consultant at least annually.
|
•
|
Reviews and discusses with management transactions with the independent compensation consultant or its affiliates.
|
•
|
Retains independent outside professional advisors, as needed.
|
•
|
Reviews and advises the Board on current and emerging social, economic, political and environmental issues.
|
•
|
Reviews management’s response to risk exposures related to regulatory, social, economic, political, reputational and environmental issues and advises the Board on management’s procedures for assessing, monitoring, controlling and reporting on such exposures.
|
•
|
Reviews the Company's programs and strategies related to environmental sustainability.
|
•
|
Reviews the Company’s policies on social responsibilities.
|
•
|
Reviews the Company’s policies and programs promoting diversity and inclusion among the Company’s suppliers.
|
•
|
Reviews the Company’s regulatory strategies and activities (including rate case strategies, rate competitiveness and environmental regulations) as well as its state and federal legislative and political activities and strategies.
|
•
|
Reviews reports from management regarding policies and safety issues related to customers and the general public.
|
•
|
Retains independent outside professional advisors, as needed.
|
18
DTE ENERGY
2019 PROXY STATEMENT
|
|
Board Committee
|
|
Areas of Risk Oversight
|
Audit Committee
|
|
Overall review of risk issues, policies and controls associated with our overall financial reporting and disclosure process and legal compliance, and review policies on risk control assessment and accounting risk exposure, as well as cybersecurity risk.
|
Finance Committee
|
|
Review of financial, capital, credit and insurance risk.
|
Organization and Compensation Committee
|
|
Assess and discuss with the Board the relationship between the inherent risks in executive compensation plans, executive compensation arrangements and executive performance goals and payouts, and how the level of risk corresponds to the Company’s business strategies.
|
Corporate Governance Committee
|
|
Review risks associated with the Company’s governance practices and the interaction of the Company’s governance with enterprise risk-level management.
|
Nuclear Review Committee
|
|
Review risks relating to the operation of our nuclear power facilities.
|
Public Policy and Responsibility Committee
|
|
Review risks associated with regulatory, social responsibility, political activity, economic conditions, reputation, safety and the environment.
|
|
DTE ENERGY
2019 PROXY STATEMENT
19
|
Cash Compensation
|
|
|
Cash retainer
|
|
$120,000 annually
|
Lead Independent Director retainer
|
|
$25,000 annually
|
Committee chair retainer
|
|
$20,000 annually for Audit Committee Chair; $15,000 annually for Corporate Governance, Finance, Nuclear Review, Organization and Compensation, and Public Policy and Responsibility Committee Chairs
|
New Member Orientation/Mentor Program
|
|
$1,250 and $750 quarterly for the New Member and Mentor, respectively, for the duration of the orientation
|
Equity Compensation
|
|
|
Upon first election to the Board
|
|
1,000 shares of restricted DTE Energy common stock
|
Annual equity compensation
|
|
A variable number of phantom shares of DTE Energy common stock valued at $130,000 annually, with the actual number of phantom shares to be granted each year determined based on the closing price of the Company’s common stock on the first business day of each calendar year(1)
|
(1)
|
Phantom shares of DTE Energy common stock are credited to each non-employee director’s account in January of each year. Phantom share accounts are also credited with dividend equivalents which are reinvested into additional phantom shares. For phantom shares granted after 2004, payment of the cash value is made three years after the date of grant unless otherwise deferred by voluntary election of the director. For phantom shares granted before 2005, payment of the cash value occurs only after the date a director terminates his or her service on the Board.
|
20
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
21
|
Name
|
|
Fees Earned or Paid in Cash ($)(1)
|
|
Stock Awards ($)(2)
|
|
All Other Compensation ($)(3)
|
|
Total ($)
|
||||
David A. Brandon
|
|
135,000
|
|
|
130,000
|
|
|
5,305
|
|
|
270,305
|
|
W. Frank Fountain, Jr.
|
|
135,000
|
|
|
130,000
|
|
|
494
|
|
|
265,494
|
|
Charles G. McClure, Jr.
|
|
120,000
|
|
|
130,000
|
|
|
5,305
|
|
|
255,305
|
|
Gail J. McGovern
|
|
120,000
|
|
|
130,000
|
|
|
5,305
|
|
|
255,305
|
|
Mark A. Murray
|
|
127,500
|
|
|
130,000
|
|
|
5,158
|
|
|
262,658
|
|
James B. Nicholson (retiring)
|
|
146,500
|
|
|
130,000
|
|
|
5,494
|
|
|
281,994
|
|
Charles W. Pryor, Jr. (retired)
|
|
67,500
|
|
|
130,000
|
|
|
7,575
|
|
|
205,075
|
|
Josue Robles, Jr. (retired)
|
|
140,000
|
|
|
130,000
|
|
|
165
|
|
|
270,165
|
|
Ruth G. Shaw
|
|
136,750
|
|
|
130,000
|
|
|
494
|
|
|
267,244
|
|
Robert C. Skaggs, Jr.
|
|
122,500
|
|
|
130,000
|
|
|
6,158
|
|
|
258,658
|
|
David A. Thomas
|
|
120,000
|
|
|
130,000
|
|
|
158
|
|
|
250,158
|
|
James H. Vandenberghe
|
|
135,000
|
|
|
130,000
|
|
|
5,305
|
|
|
270,305
|
|
Valerie M. Williams
|
|
72,917
|
|
|
102,430
|
|
|
92
|
|
|
175,439
|
|
(1)
|
The following table provides a detailed breakdown of the fees earned or paid in cash:
|
|
|
Fees Earned or Paid in Cash
|
||||||||||
Name
|
|
Board
Retainer ($)
|
|
Lead Independent Director/Committee Chair Retainers ($)
|
|
New Member Orientation/Mentor Program Fees ($)
|
|
Total ($)
|
|
|||
David A. Brandon
|
|
120,000
|
|
|
15,000
|
|
|
—
|
|
|
135,000
|
|
W. Frank Fountain, Jr.
|
|
120,000
|
|
|
15,000
|
|
|
—
|
|
|
135,000
|
|
Charles G. McClure, Jr.
|
|
120,000
|
|
|
—
|
|
|
—
|
|
|
120,000
|
|
Gail J. McGovern
|
|
120,000
|
|
|
—
|
|
|
—
|
|
|
120,000
|
|
Mark A. Murray
|
|
120,000
|
|
|
7,500
|
|
|
—
|
|
|
127,500
|
|
James B. Nicholson
|
|
120,000
|
|
|
25,000
|
|
|
1,500
|
|
|
146,500
|
|
Charles W. Pryor, Jr.
|
|
60,000
|
|
|
7,500
|
|
|
—
|
|
|
67,500
|
|
Josue Robles, Jr.
|
|
120,000
|
|
|
20,000
|
|
|
—
|
|
|
140,000
|
|
Ruth G. Shaw
|
|
120,000
|
|
|
15,000
|
|
|
1,750
|
|
|
136,750
|
|
Robert C. Skaggs, Jr.
|
|
120,000
|
|
|
—
|
|
|
2,500
|
|
|
122,500
|
|
David A. Thomas
|
|
120,000
|
|
|
—
|
|
|
—
|
|
|
120,000
|
|
James H. Vandenberghe
|
|
120,000
|
|
|
15,000
|
|
|
—
|
|
|
135,000
|
|
Valerie M. Williams
|
|
70,000
|
|
|
—
|
|
|
2,917
|
|
|
72,917
|
|
(2)
|
These amounts represent the dollar amounts of compensation cost for 2018 in accordance with ASC Topic 718 and, as such, include costs recognized in the financial statements with respect to phantom shares and shares of restricted stock granted. Because the phantom shares are 100% vested (with a mandatory three-year deferral) on the grant date, the ASC Topic 718 expense equals the grant date fair value as of January 2, 2018. The grant date fair value of $108.45 was the closing price of the Company stock on January 2, 2018. For all of the non-employee directors except Ms. Williams, this amount is $130,000 in phantom shares of DTE Energy stock granted on January 2, 2018, subject to a three-year payment deferral. Based on the grant date fair value of $108.45, this grant equated to a grant of 1,200 phantom shares. For Ms. Williams, this amount is the value of 1,000 shares of restricted stock granted on May 31, 2018. For this award, the grant date fair value of $102.43 was the closing price on May 31, 2018.
|
22
DTE ENERGY
2019 PROXY STATEMENT
|
|
Name
|
|
Phantom Shares in Equity Plan
|
|
Phantom Shares in Deferred Fee Plan
|
|
Restricted Stock
|
|||
David A. Brandon
|
|
4,314
|
|
|
6,398
|
|
|
—
|
|
W. Frank Fountain, Jr.
|
|
23,410
|
|
|
13,472
|
|
|
—
|
|
Charles G. McClure, Jr.
|
|
4,314
|
|
|
609
|
|
|
—
|
|
Gail J. McGovern
|
|
31,127
|
|
|
—
|
|
|
—
|
|
Mark A. Murray
|
|
4,314
|
|
|
609
|
|
|
—
|
|
James B. Nicholson
|
|
9,734
|
|
|
6,050
|
|
|
—
|
|
Charles W. Pryor, Jr.
|
|
20,989
|
|
|
—
|
|
|
—
|
|
Josue Robles, Jr.
|
|
6,193
|
|
|
—
|
|
|
—
|
|
Ruth G. Shaw
|
|
4,314
|
|
|
—
|
|
|
—
|
|
Robert C. Skaggs, Jr.
|
|
1,230
|
|
|
—
|
|
|
1,000
|
|
David A. Thomas
|
|
4,314
|
|
|
—
|
|
|
—
|
|
James H. Vandenberghe
|
|
4,314
|
|
|
5,448
|
|
|
—
|
|
Valerie M. Williams
|
|
—
|
|
|
—
|
|
|
1,000
|
|
(3)
|
This amount is the total of the premiums paid for the group-term life insurance provided to the non-employee directors by the Company and all contributions made by the DTE Energy Foundation under the Company matching program. For Mr. Pryor, the amount also includes personal use of the corporate aircraft.
|
Name
|
|
Age(1)
|
|
Present Position
|
|
Present
Position
Held Since
|
|
Gerard M. Anderson
|
|
60
|
|
Chairman of the Board and Chief Executive Officer
|
|
12/30/2013
|
|
Trevor F. Lauer
|
|
54
|
|
President and Chief Operating Officer, DTE Electric Company
|
|
4/4/2016
|
(2)
|
David E. Meador
|
|
62
|
|
Vice Chairman and Chief Administrative Officer
|
|
1/1/2014
|
|
Lisa A. Muschong
|
|
49
|
|
Vice President, Corporate Secretary and Chief of Staff
|
|
11/2/2015
|
(2)
|
Gerardo Norcia
|
|
56
|
|
President and Chief Operating Officer, DTE Energy Company
|
|
4/4/2016
|
(2)
|
Peter B. Oleksiak
|
|
52
|
|
Senior Vice President and Chief Financial Officer
|
|
1/1/2014
|
|
Bruce D. Peterson
|
|
62
|
|
Senior Vice President and General Counsel
|
|
6/25/2002
|
|
Mark C. Rolling
|
|
51
|
|
Vice President, Controller and Chief Accounting Officer
|
|
3/4/2019
|
(2)
|
David Ruud
|
|
52
|
|
President-Power and Industrial
|
|
12/30/2013
|
|
David Slater
|
|
53
|
|
President-DTE Gas Storage and Pipelines
|
|
10/2/2014
|
(2)
|
Mark W. Stiers
|
|
56
|
|
President & Chief Operating Officer, DTE Gas Company
|
|
12/30/2013
|
|
(1)
|
As of March 14, 2019.
|
(2)
|
These executive officers have held various other positions at DTE Energy for five or more years.
|
|
DTE ENERGY
2019 PROXY STATEMENT
23
|
24
DTE ENERGY
2019 PROXY STATEMENT
|
|
Name of Beneficial Owners
|
|
Common Stock(1)
|
|
|
|
Phantom Stock(2)
|
|
Options Exercisable
Within 60 Days
|
|
Other Shares That May Be Acquired(3)
|
||||
Gerard M. Anderson
|
|
517,713
|
|
|
|
|
13,408
|
|
|
32,500
|
|
|
173,283
|
|
David A. Brandon
|
|
1,000
|
|
|
|
|
10,712
|
|
|
—
|
|
|
—
|
|
W. Frank Fountain, Jr.
|
|
1,000
|
|
|
|
|
36,382
|
|
|
—
|
|
|
—
|
|
Charles G. McClure, Jr.
|
|
1,000
|
|
|
|
|
4,923
|
|
|
—
|
|
|
—
|
|
Gail J. McGovern
|
|
—
|
|
|
|
|
31,127
|
|
|
—
|
|
|
—
|
|
Mark A. Murray
|
|
1,000
|
|
|
|
|
4,923
|
|
|
—
|
|
|
—
|
|
James B. Nicholson
|
|
4,200
|
|
|
|
|
15,784
|
|
|
—
|
|
|
—
|
|
Ruth G. Shaw
|
|
3,500
|
|
|
|
|
4,314
|
|
|
—
|
|
|
—
|
|
Robert C. Skaggs, Jr.
|
|
1,000
|
|
|
|
|
1,230
|
|
|
—
|
|
|
—
|
|
David A. Thomas
|
|
1,673
|
|
|
|
|
4,314
|
|
|
—
|
|
|
—
|
|
James H. Vandenberghe
|
|
2,000
|
|
|
|
|
9,762
|
|
|
—
|
|
|
—
|
|
Valerie M. Williams
|
|
1,000
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Trevor F. Lauer
|
|
14,767
|
|
|
|
|
1,301
|
|
|
—
|
|
|
22,520
|
|
David E. Meador
|
|
150,671
|
|
|
|
|
—
|
|
|
—
|
|
|
39,699
|
|
Gerardo Norcia
|
|
132,012
|
|
|
|
|
1,330
|
|
|
—
|
|
|
54,936
|
|
Peter B. Oleksiak
|
|
29,295
|
|
|
|
|
—
|
|
|
—
|
|
|
33,793
|
|
Directors and Executive Officers as a group — 22 persons
|
|
1,003,060
|
|
|
|
|
140,463
|
|
|
32,500
|
|
|
397,578
|
|
(1)
|
Includes directly held common stock, restricted stock and shares held pursuant to the DTE Energy Company Savings and Stock Ownership Plan (tax-qualified 401(k) plan).
|
(2)
|
Shares of phantom stock are acquired as follows: (a) by non-employee directors (i) as compensation under the DTE Energy Company Deferred Stock Compensation Plan for Non-Employee Directors and (ii) through participation in the DTE Energy Company Plan for Deferring the Payment of Directors’ Fees and (b) by executive officers pursuant to the (i) DTE Energy Company Supplemental Savings Plan and (ii) DTE Energy Company Executive Supplemental Retirement Plan. Shares of phantom stock may be paid out in either cash or stock.
|
(3)
|
Represents performance shares under the Long-Term Incentive Plan (as described beginning on page 42) that entitle the executive officers to receive shares or cash equivalents (or a combination thereof) in the future if certain performance measures are met. The number of performance shares reflected in the table assumes that target levels of performance are achieved and includes an increase from the original grant amount, assuming full dividend reinvestment at the fair market value on each dividend payment date. Performance shares are not currently outstanding shares of our common stock and are subject to forfeiture if the performance measures are not achieved over a designated period of time. Executive officers do not have voting or investment power over the performance shares until performance measures are achieved. See the discussion in “Long-Term Incentives - Performance Shares Granted in 2018” beginning on page 42.
|
|
DTE ENERGY
2019 PROXY STATEMENT
25
|
Title of Class
|
|
Name and Address of Beneficial Owner
|
|
Amount and Nature of Beneficial Ownership
|
|
|
Percent
of Class
|
||
Common Stock
|
|
The Vanguard Group, Inc.
100 Vanguard Blvd.
Malvern, Pennsylvania 19355
|
|
20,388,434
|
|
(1)
|
|
11.2
|
%
|
Common Stock
|
|
Capital World Investors
333 South Hope Street
Los Angeles, California 90071
|
|
18,193,148
|
|
(2)
|
|
10.0
|
%
|
Common Stock
|
|
BlackRock, Inc.
55 East 52nd Street
New York, New York 10055
|
|
15,212,035
|
|
(3)
|
|
8.4
|
%
|
Common Stock
|
|
State Street Corporation
One Lincoln Street
Boston, Massachusetts 02111
|
|
9,179,977
|
|
(4)
|
|
5.0
|
%
|
(1)
|
Based on information contained in Schedule 13G/A filed on February 11, 2019. Shares listed as beneficially owned by Vanguard are owned by the following entities: The Vanguard Fiduciary Trust Company, Vanguard Investments Australia, Ltd. and The Vanguard Group, Inc. The Vanguard Group, Inc. has sole voting power with respect to 208,302 shares, sole dispositive power with respect to 20,116,239 shares, shared dispositive power with respect to 272,195 shares and is deemed to beneficially own 20,388,434 shares.
|
(2)
|
Based on information contained in Schedule 13G filed on February 14, 2019. Capital World Investors has sole dispositive power with respect to 18,193,148 shares, sole voting power with respect to 18,193,148 shares, and is deemed to beneficially own 18,193,148 shares.
|
(3)
|
Based on information contained in Schedule 13G/A filed on February 4, 2019. Shares listed as beneficially owned by BlackRock are owned by the following entities: BlackRock Life Limited, BlackRock International Limited, BlackRock Advisors, LLC, BlackRock (Netherlands) B.V., BlackRock Institutional Trust Company, National Association, BlackRock Asset Management Ireland Limited, BlackRock Financial Management, Inc., iShares (DE) I Investmentaktiengesellschaft mit Teilgesellschaftsvermogen, BlackRock Japan Co., Ltd, BlackRock Asset Management Schweiz AG, BlackRock Investment Management, LLC, and BlackRock Investment Management (UK)
|
26
DTE ENERGY
2019 PROXY STATEMENT
|
|
(4)
|
Based on information contained in Schedule 13G filed on February 14, 2019. Shares listed as beneficially owned by State Street are owned by the following entities: SSGA Funds Management, Inc., State Street Global Advisors Limited (UK), State Street Global Advisors Ltd (Canada), State Street Global Advisors, Australia Limited, State Street Global Advisors (Japan) Co., LTD., State Street Global Advisors (Asia) LTD., State Street Global Advisors Singapore LTD., State Street Global Advisors GmbH, State Street Global Advisors Ireland Limited, and State Street Global Advisor Trust Company. State Street Corporation has shared voting power with respect to 8,451,100 shares, shared dispositive power with respect to 9,162,117 shares, and is deemed to beneficially own 9,179,977 shares.
|
|
DTE ENERGY
2019 PROXY STATEMENT
27
|
|
2018
|
|
2017
|
||||
Audit fees(1)
|
$
|
7,173,518
|
|
|
$
|
7,501,916
|
|
Audit-related fees(2)
|
587,507
|
|
|
390,092
|
|
||
Tax fees(3)
|
217,836
|
|
|
282,240
|
|
||
All other fees(4)
|
2,117,297
|
|
|
3,003,472
|
|
||
Total
|
$
|
10,096,158
|
|
|
$
|
11,177,720
|
|
(1)
|
Represents fees for professional services performed by PwC for the audits of the Company’s consolidated annual financial statements included in the Company’s Form 10-K, review and audit of the Company’s internal control over financial reporting, the review of consolidated financial statements included in the Company’s Form 10-Q filings, and services that are normally provided in connection with regulatory filings or engagements. Audit fees are presented on an Audit Year basis in accordance with SEC guidelines and include an estimate of fees incurred for the most recent Audit Year.
|
(2)
|
Represents the aggregate fees billed for audit-related services and various attest services.
|
(3)
|
Represents fees billed for tax services, including tax reviews and planning.
|
(4)
|
Represents consulting services for the purpose of providing advice and recommendations.
|
•
|
A report summarizing the services, or groupings of related services, including fees, provided by the independent registered public accounting firm.
|
•
|
A listing of new services requiring pre-approval, if any.
|
•
|
As appropriate, an updated projection for the current fiscal year, presented in a manner consistent with the proxy disclosure requirements, of the estimated annual fees to be paid to the independent registered public accounting firm.
|
28
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
29
|
•
|
Achieved 9.0% compound operating earnings per share growth during the five years ending 2018 (see discussion of operating earnings on page 39).
|
•
|
Increased our dividend payment to $3.60 per share in 2018, representing a 9% increase over the dividend in 2017.
|
•
|
Provided our shareholders with a five-year total shareholder return of 196% (indexed with 2013 as the base year = 100%).
|
•
|
Delivered cash from operations of 2.7 billion in 2018.
|
•
|
Ranked second in residential customer satisfaction in the Midwest from J.D. Power for both electric and gas utilities.
|
•
|
Received Gallup Great Workplace Award for the sixth consecutive year.
|
30
DTE ENERGY
2019 PROXY STATEMENT
|
|
Elements of Compensation
|
|
How this Element Serves the Company’s Objectives
|
Base Salary
|
|
Provides a stable, fixed source of income that reflects an executive’s job responsibilities, experience, value to the Company and demonstrated performance.
We target median base salaries for our peer group, taking into account differences in company size within the peer group.
|
Annual Incentive Awards
|
|
Intended to compensate individuals yearly based on the achievement of specific near-term, annual goals, which are established at the beginning of each year and approved by the O&C Committee.
The Board and management have identified several priority areas that management and the Board discuss regularly when reviewing Company performance. Our performance measures for annual incentive awards are the measurements that the Board uses to track progress in these key priority areas. Achievement of these performance objectives is a critical measure of the Company’s progress towards its goal of becoming the best-operated energy company in North America and a force for growth and prosperity in the communities where we live and serve.
|
Long-term Incentive Awards
|
|
Used to align executive actions with long-term management and shareholder objectives, providing rewards consistent with the creation of shareholder value.
Our plan is designed to help retain executives over time and ensure they have a strong sense of ownership in the Company.
|
|
DTE ENERGY
2019 PROXY STATEMENT
31
|
Our System of Priorities
|
|
Related Annual or Long-Term Performance Metrics
|
Highly Engaged Employees
|
|
DTE Energy Employee Engagement - Gallup
DTE Energy OSHA Recordable Incident Rate
DTE Energy OSHA Days Away, Restricted and Transfer Rate
|
Top-Decile Customer Satisfaction
|
|
Customer Satisfaction Index
Customer Satisfaction Improvement Program Index
MPSC Customer Complaints
|
Distinctive Continuous Improvement Capability
|
|
Customer Satisfaction Improvement Program Index
Utility Operating Excellence Index
|
Strong Political & Regulatory Context
|
|
Customer Satisfaction Improvement Program Index
Utility Operating Excellence Index
MPSC Customer Complaints
|
Clear Growth & Value Creation Strategy
|
|
DTE Energy Total Shareholder Return vs Peer Group
|
Superior & Sustainable Financial Performance
|
|
DTE Energy Cash Flow
DTE Energy Operating Earnings Per Share
DTE Energy Ratio of Funds From Operations to Debt
|
•
|
We use multiple performance measures in our short-term and long-term plans that link compensation to our corporate objectives to be the best operated energy company in North America and to maximize shareholder value
|
•
|
We make the majority of our compensation for Named Executive Officers “at risk” to further tie compensation to performance and shareholder interests
|
•
|
Our O&C Committee is comprised of all independent directors and our compensation consultant is independent
|
•
|
We adopted a clawback mechanism to allow the Company to recover incentive compensation in the event of a material financial restatement
|
•
|
We require executives and directors to meet robust stock ownership requirements
|
•
|
We review and update our peer groups and benchmarking on a regular basis to make sure our compensation remains competitive and near the median of the peer group
|
•
|
We engage with shareholders to seek input about our compensation practices and policies
|
•
|
No single-trigger change-in-control payments
|
•
|
No excessive perquisites
|
•
|
No tax gross-ups on change-in-control agreements
|
•
|
No guaranteed bonuses
|
•
|
No pledging, hedging or short sales of Company securities for officers or directors
|
•
|
No stock option grants since 2010
|
•
|
No repricing of existing stock options
|
•
|
No “excessive” golden parachute payments in any of our change-in-control arrangements
|
32
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
Our compensation philosophy and objectives for executives of the Company, including our Named Executive Officers;
|
•
|
The roles of our O&C Committee and management in the executive compensation process;
|
•
|
The key components of the executive compensation program; and
|
•
|
The decisions we make in the compensation process that align with our philosophy and objectives.
|
•
|
Compensation must be competitive in order to attract and retain talented executives — data from peer group companies are taken into consideration when analyzing our compensation practices and levels;
|
|
DTE ENERGY
2019 PROXY STATEMENT
33
|
•
|
Compensation should have a meaningful performance component — a portion of an executive’s total compensation opportunity is linked to predefined short-term and long-term corporate and financial objectives along with an executive’s individual performance; and
|
•
|
Compensation must include equity-based elements to encourage executives to have an ownership interest in the Company.
|
34
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
Recommending performance measures and metrics that are formulated based on our corporate strategy and priorities;
|
•
|
Reporting executive performance evaluations;
|
•
|
Recommending base salary levels and other compensation, including equity awards; and
|
•
|
Recommending appointment of executives.
|
|
DTE ENERGY
2019 PROXY STATEMENT
35
|
•
|
Base Salary
|
•
|
Annual and Long-Term Incentives
|
•
|
Pension and Deferred Compensation
|
•
|
Post-Termination Agreements (Severance and Change-In-Control)
|
36
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
The executive’s most recent year-end base salary is multiplied by an Annual Incentive Plan target percentage to arrive at the target award.
|
•
|
The overall performance payout percentage, which can range from 0% to 175%, is determined based on final results compared to threshold, target and maximum levels for each objective.
|
•
|
The target award is then multiplied by the performance payout percentage to arrive at the pre-adjusted calculated award.
|
•
|
The pre-adjusted calculated award is then adjusted by an individual performance modifier (assessment of an individual executive’s achievements for the year), which can range from 0% to 150%, to arrive at the final award.
|
|
DTE ENERGY
2019 PROXY STATEMENT
37
|
Measures
|
|
Weight
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
Result
|
|
Payout
|
|
Weighted
Average
Payout
|
||||||||||
DTE Energy Operating Earnings Per Share
|
|
20.0
|
%
|
|
$
|
5.57
|
|
|
$
|
5.78
|
|
|
$
|
5.99
|
|
|
$
|
6.30
|
|
|
175.0%
|
|
35.00%
|
|
DTE Energy Adjusted Cash Flow ($ millions)
|
|
20.0
|
%
|
|
$
|
(691
|
)
|
|
$
|
(274
|
)
|
|
$
|
144
|
|
|
$
|
346
|
|
|
175.0%
|
|
35.00%
|
|
Customer Satisfaction Index (percentile)
|
|
8.0
|
%
|
|
76
|
|
|
86
|
|
|
96
|
|
|
66.5
|
|
|
0.0%
|
|
0.00%
|
|
||||
Customer Satisfaction Improvement Program (#)
|
|
4.0
|
%
|
|
53,506
|
|
|
50,748
|
|
|
47,990
|
|
|
76,129
|
|
|
0.0%
|
|
0.00%
|
|
||||
Customer Satisfaction Improvement Index (#)
|
|
4.0
|
%
|
|
100,378
|
|
|
105,397
|
|
|
110,416
|
|
|
102,464
|
|
|
56.2%
|
|
2.25%
|
|
||||
MPSC Customer Complaints
|
|
4.0
|
%
|
|
1,781
|
|
|
1,681
|
|
|
1,581
|
|
|
3,317
|
|
|
0.0%
|
|
0.00%
|
|
||||
DTE Energy Employee Engagement– Gallup
|
|
10.0
|
%
|
|
4.18
|
|
|
4.32
|
|
|
4.45
|
|
|
4.380
|
|
|
134.6%
|
|
13.46%
|
|
||||
Safety Performance & Effectiveness Index:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
DTE Energy OSHA Recordable Incident Rate
|
|
5.0
|
%
|
|
0.72
|
|
|
0.58
|
|
|
0.40
|
|
|
0.51
|
|
|
127.7%
|
|
6.39%
|
|
||||
DTE Energy OSHA Days Away, Restricted and Transfers Rate
|
|
5.0
|
%
|
|
0.45
|
|
|
0.33
|
|
|
0.20
|
|
|
0.20
|
|
|
172.9%
|
|
8.65%
|
|
||||
Utility Operating Excellence Index:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
All Weather SAIDI (minutes)
|
|
2.5
|
%
|
|
265
|
|
|
240
|
|
|
227
|
|
|
485
|
|
|
0.0%
|
|
0.00%
|
|
||||
Blue Sky CAIDI (minutes)
|
|
2.5
|
%
|
|
139
|
|
|
129
|
|
|
116
|
|
|
116
|
|
|
175.0%
|
|
4.38%
|
|
||||
Fossil Power Plant Reliability
|
|
5.0
|
%
|
|
8.3
|
%
|
|
7.3
|
%
|
|
6.3
|
%
|
|
6.3
|
%
|
|
175.0%
|
|
8.75%
|
|
||||
Nuclear Generation Operating Excellence Index
|
|
5.0
|
%
|
|
[see footnote for description]
|
|
Above Target
|
|
103.1%
|
|
5.16%
|
|
||||||||||||
Gas Distribution System Improvement
|
|
1.25
|
%
|
|
1,373
|
|
|
973
|
|
|
673
|
|
|
586
|
|
|
175.0%
|
|
2.19%
|
|
||||
Gas Distribution Response Time (minutes)
|
|
0.75
|
%
|
|
23.8
|
|
|
22.8
|
|
|
21.8
|
|
|
23.1
|
|
|
76.0%
|
|
0.57%
|
|
||||
Lost and Unaccounted for Gas (bcf)
|
|
0.75
|
%
|
|
3.6
|
|
|
3.3
|
|
|
3.0
|
|
|
3.7
|
|
|
0.0%
|
|
0.00%
|
|
||||
Gas Compression Reliability
|
|
0.75
|
%
|
|
88.0
|
%
|
|
90.0
|
%
|
|
91.0
|
%
|
|
92.1
|
%
|
|
175.0%
|
|
1.31%
|
|
||||
Gas Damage Prevention Effectiveness
|
|
1.0
|
%
|
|
3.5
|
|
|
3.3
|
|
|
3.1
|
|
|
5.1
|
|
|
0.0%
|
|
0.00%
|
|
||||
Gas Transmission Reliability
|
|
0.5
|
%
|
|
32
|
|
|
34
|
|
|
36
|
|
|
36
|
|
|
175.0%
|
|
0.88%
|
|
||||
Total
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
123.99
|
%
|
38
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
2018
|
|
2013
|
|
||
Reported Earnings per Share
|
$
|
6.17
|
|
$
|
3.76
|
|
Remeasurement of deferred taxes due to TCJA
|
0.12
|
|
||||
Implementation costs of new billing system
|
0.02
|
|
||||
One-time benefits expense reimbursement, net of customer sharing
|
(0.05
|
)
|
|
|||
Asset impairment
|
0.03
|
0.02
|
|
|||
Certain mark-to-market transactions
|
0.01
|
|
0.31
|
|
||
Operating Earnings per Share
|
$
|
6.30
|
|
$
|
4.09
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
39
|
a.
|
Nuclear Power Plant Performance Improvement Matrix: Summation of points assigned to each of five improvement indicators based on performance.
|
b.
|
Refuel Outage Duration: The time between the breaker open to the breaker close that the plant is off-line to refuel the reactor.
|
c.
|
Nuclear On-Line Unit Capability Factor: The ratio of available energy generation over a given time period to the reference energy generation over the same time period.
|
d.
|
Nuclear Power Plant Reliability Matrix: Summation of points assigned to each of five reliability indicators based on performance.
|
40
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
41
|
a.
|
Nuclear Power Plant Performance Improvement Matrix: Summation of points assigned to each of five improvement indicators based on performance.
|
b.
|
Refuel Outage Duration: The time between the breaker open to the breaker close that the plant is off-line to refuel the reactor.
|
c.
|
Nuclear On-Line Unit Capability Factor: The ratio of available energy generation over a given time period to the reference energy generation over the same time period.
|
d.
|
Nuclear Power Plant Reliability Matrix: Summation of points assigned to each of five reliability indicators based on performance.
|
Performance Shares
|
|
Approximately 70%
|
Restricted Stock
|
|
Approximately 30%
|
•
|
Performance Shares Granted in 2018:
In 2018, performance shares represented approximately 70% of the overall long-term incentive grant value. Granting of performance shares allows us to tie long-term performance objectives with creating shareholder value. Performance shares entitle the executive to receive a specified number of shares, or a cash payment equal to the fair market value of the shares, or a combination of the two, in the plan administrator’s discretion, depending on the level of achievement of performance measures. The performance measurement period for the 2018 grants is January 1, 2018 through December 31, 2020. Payments earned under the 2018 grants and the related performance measures are described in footnote 2 to the “Grants of Plan-Based Awards” table on page 50. In the event a participant retires (age 65 or age 55 or older with at least 10 years of
|
42
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
Performance Shares Paid in 2018
: The performance shares granted in 2015 were paid in early 2018. The payout amounts were based upon performance measures, each of which was weighted to reflect its importance to the total calculation. The Company had to attain a minimum level for each measure before any compensation was payable with respect to that measure. The minimum established level of each measure would have resulted in a payout of 50% of target, and an established maximum (or better) for each level would have resulted in a payout of 200% of target. The payout amount was based upon the following performance measures (and related weighting):
|
Measures
|
|
Weight
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
Result
|
|
Payout
%
|
|
Weighted
Average
Payout %
|
|||
Total Shareholder Return: DTE vs. Peer Group
|
|
80
|
%
|
|
25th percentile
|
|
50th percentile
|
|
75th percentile
|
|
52nd percentile
|
|
108.0
|
%
|
|
86.4
|
%
|
Balance Sheet Health— FFO to Debt
|
|
20
|
%
|
|
18.0%
|
|
20.0%
|
|
22.0%
|
|
20.8%
|
|
140.0
|
%
|
|
28.0
|
%
|
Total
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
114.4
|
%
|
Measures
|
|
Weight
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
Result
|
|
Payout
%
|
|
Weighted
Average
Payout %
|
|||
Total Shareholder Return: DTE vs. Peer Group
|
|
60
|
%
|
|
25th percentile
|
|
50th percentile
|
|
75th percentile
|
|
52nd percentile
|
|
108.0
|
%
|
|
64.8
|
%
|
Balance Sheet Health—FFO to Debt
|
|
20
|
%
|
|
18.0%
|
|
20.0%
|
|
22.0%
|
|
20.8%
|
|
140.0
|
%
|
|
28.0
|
%
|
DTE Electric Average Return on Equity 2015-2017
|
|
20
|
%
|
|
9.8%
|
|
10.3%
|
|
10.8%
|
|
10.4%
|
|
120.0
|
%
|
|
24.0
|
%
|
Total
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
116.8
|
%
|
•
|
FFO is defined as the sum of: (1) operating net income, (2) deferred taxes, (3) depreciation and amortization (excluding amortization related to DTE Electric’s securitization debt), (4) income statement impact of capitalizing operating leases, and (5) 50% of the interest (after-tax) on DTE Energy's Junior Subordinated Debt; and
|
•
|
Debt is defined as all long-term and short-term debt of DTE Energy Company, adjusted as follows: (1) exclude portion of DTE Gas’s short-term debt attributable to seasonal working capital needs; (2) exclude 50% of DTE
|
|
DTE ENERGY
2019 PROXY STATEMENT
43
|
Alliant Energy Corporation
|
|
PG&E Corporation
|
Ameren Corporation
|
|
Pinnacle West Capital Corporation
|
Avista Corporation
|
|
PNM Resources, Inc.
|
CenterPoint Energy, Inc.
|
|
Portland General Electric Company
|
CMS Energy Corporation
|
|
SCANA Corporation
|
Consolidated Edison, Inc.
|
|
Southern Company
|
Duke Energy Corporation
|
|
Vectren Corporation
|
Eversource Energy
|
|
Westar Energy, Inc.
|
Great Plains Energy, Inc.
|
|
Wisconsin Energy Corporation
|
IDACORP Inc.
|
|
Xcel Energy, Inc.
|
NorthWestern Energy
|
|
|
•
|
Restricted Stock:
The restricted stock grants are time-based and generally include a three-year vesting period. The granting of restricted stock allows us to grant executives long-term equity incentives to encourage continued employment. In 2018, restricted stock was granted, representing approximately 30% of the overall Long-Term Incentive Plan grant value, with the restriction period ending on January 31, 2021. The three-year vesting period focuses on long-term value creation and executive retention. The three-year vesting period requires continued employment throughout the restriction period. In the event a participant retires (age 65 or age 55 or older with at least 10 years of service), dies or becomes disabled, the participant or beneficiary retains the right to a pro-rated number of restricted shares. In the event employment terminates for any other reason, the participant forfeits all rights to any outstanding restricted shares.
|
•
|
Stock Options:
The O&C Committee has not granted stock options under the Long-Term Incentive Plan since 2010. In 2010, nonqualified stock options represented approximately 20% of the overall Long-Term Incentive Plan grant value. The granting of stock options allowed us to grant executives long-term equity incentives that align long-term performance with creating shareholder value. These stock options have a ten-year exercise period and vest one-third on each anniversary of the grant date over a three-year period. The stock option exercise price is based on the closing price on the date the options are granted. In the event a participant retires (age 65 or age 55 or older with at least 10 years of service) or becomes disabled, the participant retains the rights to all outstanding vested and unvested stock options in accordance with the original terms of the grant. In the event a participant dies, the beneficiary has three years from the date of death to exercise the stock options. In the event employment terminates for any other reason, the participant forfeits all rights to any unvested stock options and has 90 days to
|
44
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
Security driver for business: Based on our executive security policies and a security risk assessment by the Company’s chief security officer, the Board requires Mr. Anderson to use a Company car and security driver while on Company business. The Company has also provided Mr. Norcia with a Company car and security driver to use while on Company business.
|
•
|
Corporate aircraft for limited business travel: We lease a fractional share of an aircraft for limited business travel by executives and other employees when there is an appropriate business purpose. Personal use of the aircraft is not allowed except in unusual circumstances and requires the prior approval of the CEO. During 2018, there was no personal use of the corporate aircraft by any executive.
|
•
|
Supplemental retirement benefits: Certain executives are eligible for both tax-qualified and non-qualified retirement benefits which are commonly offered by other employers in our peer group. For further description of the supplemental retirement benefits, see "Pension Benefits" beginning on page 52.
|
•
|
Other benefits: Executives are allowed the limited use of corporate event tickets and the corporate condominium when available. The Company also provides home security monitoring for some executives, including some of the Named Executive Officers.
|
|
DTE ENERGY
2019 PROXY STATEMENT
45
|
46
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
47
|
Name and
Principal Position
|
|
Year
|
|
Salary
($)(1)
|
|
Stock
Awards
($)(2)
|
|
Non-Equity
Incentive
Plan
Compensation
($)(3)
|
|
Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)(4)
|
|
All Other
Compensation
($)(5)
|
|
Total
($)
|
||||||
Gerard M. Anderson,
|
|
2018
|
|
1,344,231
|
|
|
6,992,734
|
|
|
2,500,000
|
|
|
—
|
|
|
149,844
|
|
|
10,986,809
|
|
Chairman and Chief Executive Officer
|
|
2017
|
|
1,319,231
|
|
|
8,813,700
|
|
|
2,800,000
|
|
|
2,768,249
|
|
|
134,727
|
|
|
15,835,907
|
|
|
|
2016
|
|
1,293,519
|
|
|
7,141,380
|
|
|
2,500,000
|
|
|
1,419,689
|
|
|
144,351
|
|
|
12,498,939
|
|
Peter B. Oleksiak,
|
|
2018
|
|
615,385
|
|
|
1,522,908
|
|
|
663,000
|
|
|
694,398
|
|
|
77,764
|
|
|
3,573,455
|
|
Senior Vice President and Chief Financial Officer
|
|
2017
|
|
592,385
|
|
|
1,498,329
|
|
|
643,000
|
|
|
832,450
|
|
|
79,209
|
|
|
3,645,373
|
|
|
|
2016
|
|
553,519
|
|
|
1,358,604
|
|
|
542,700
|
|
|
401,975
|
|
|
73,805
|
|
|
2,930,603
|
|
Trevor F. Lauer,
|
|
2018
|
|
534,615
|
|
|
1,151,476
|
|
|
600,000
|
|
|
38,410
|
|
|
77,564
|
|
|
2,402,065
|
|
President and Chief Operating Officer - DTE Electric
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
David E. Meador,
|
|
2018
|
|
727,692
|
|
|
1,743,060
|
|
|
857,000
|
|
|
—
|
|
|
88,736
|
|
|
3,416,488
|
|
Vice Chairman and Chief Administrative Officer
|
|
2017
|
|
717,692
|
|
|
1,596,259
|
|
|
927,600
|
|
|
1,180,550
|
|
|
88,154
|
|
|
4,510,255
|
|
|
|
2016
|
|
694,815
|
|
|
1,802,763
|
|
|
857,700
|
|
|
795,805
|
|
|
89,936
|
|
|
4,241,019
|
|
Gerardo Norcia,
|
|
2018
|
|
826,923
|
|
|
2,979,048
|
|
|
1,264,700
|
|
|
284,485
|
|
|
121,721
|
|
|
5,476,877
|
|
President and Chief Operating Officer
|
|
2017
|
|
730,385
|
|
|
2,252,390
|
|
|
1,275,800
|
|
|
522,829
|
|
|
90,510
|
|
|
4,871,914
|
|
|
|
2016
|
|
650,926
|
|
|
1,942,107
|
|
|
848,700
|
|
|
343,180
|
|
|
84,851
|
|
|
3,869,764
|
|
(1)
|
The base salary amounts reported include amounts which were voluntarily deferred by the Named Executive Officers into the DTE Energy Company Supplemental Savings Plan (a nonqualified 401(k) plan, the “Supplemental Savings Plan”). The amounts deferred by each of the Named Executive Officers were as follows:
|
Name
|
|
2018 Deferred Amount
($)
|
|
2017 Deferred Amount
($)
|
|
2016 Deferred Amount
($)
|
Gerard M. Anderson
|
|
115,923
|
|
113,923
|
|
111,352
|
Peter B. Oleksiak
|
|
49,192
|
|
47,162
|
|
42,887
|
Trevor F. Lauer
|
|
34,961
|
|
|
|
|
David E. Meador
|
|
53,046
|
|
52,308
|
|
51,555
|
Gerardo Norcia
|
|
64,192
|
|
55,039
|
|
34,074
|
(2)
|
These amounts represent the grant date fair value of the restricted stock and performance shares granted in 2016, 2017 and 2018 in accordance with ASC Topic 718. The number of awards granted and other information related to the 2018 grants are detailed in the “Grants of Plan-Based Awards” table on page 50.
|
(3)
|
The 2018 annual incentive amounts, shown in the Non-Equity Incentive Plan Compensation column, paid to the Named Executive Officers were calculated as described beginning on page 37 and include an individual performance modifier.
|
48
DTE ENERGY
2019 PROXY STATEMENT
|
|
(4)
|
The amounts in this column represent the aggregate change in the actuarial present values of each Named Executive Officer’s accumulated benefits under the DTE Energy Company Retirement Plan ("Qualifed Plan"), the DTE Energy Company Supplemental Retirement Plan ("SRP"), and the DTE Energy Company Executive Supplemental Retirement Plan ("ESRP"). The measurement period for each of 2016, 2017 and 2018 was the calendar year. Amounts in this column change from year to year based on a number of different variables. The primary variable is the discount rate used for valuation purposes. The discount rate used for 2016 valuations was 4.25% for all plans. The discount rates used for 2017 valuations were 3.70% for the Qualified Plan and 3.60% for the SRP and ESRP. The discount rates used for 2018 valuations were 4.40% for the Qualified Plan, 4.12% for the SRP and 4.18% for the ESRP. SEC rules indicate that if the change in pension value is negative, the result should be displayed as $0 in the Summary Compensation Table. For Messrs. Anderson and Meador the actual change in pension value was $(693,477) and $(546,783), respectively. These plans are described in more detail beginning on page 52.
|
(5)
|
The following table provides a breakdown of the 2018 amounts reported in this column:
|
Name
|
|
Company Matching
Contributions to
the Savings Plan
($)*
|
|
Company Matching
Contributions to
the Supplemental
Savings Plan
($) *, **
|
|
Additional
Benefits
($)***
|
|
Total
($)
|
||||
Gerard M. Anderson
|
|
9,173
|
|
|
71,481
|
|
|
69,190
|
|
|
149,844
|
|
Peter B. Oleksiak
|
|
9,732
|
|
|
27,185
|
|
|
40,847
|
|
|
77,764
|
|
Trevor F. Lauer
|
|
10,691
|
|
|
21,381
|
|
|
45,492
|
|
|
77,564
|
|
David E. Meador
|
|
3,277
|
|
|
39,785
|
|
|
45,674
|
|
|
88,736
|
|
Gerardo Norcia
|
|
10,377
|
|
|
39,231
|
|
|
72,113
|
|
|
121,721
|
|
*
|
The matching contributions reflected in these two columns are predicated on the Named Executive Officers making contributions from eligible compensation to the DTE Energy Savings and Stock Ownership Plan (a tax-qualified 401(k) plan, the “Savings Plan”) and the Supplemental Savings Plan. The total combined Company matching contributions between the plans cannot exceed 6% of eligible compensation for each of the Named Executive Officers.
|
**
|
The Supplemental Savings Plan provides for deferring compensation in excess of various Internal Revenue Code limits imposed on tax qualified plans, including the maximum employee pre-tax contribution limit ($18,000 plus $6,000 per year catch-up contributions for 2016 and 2017 and $18,500 plus $6,000 per year catch-up contributions for 2018) and the compensation limit ($265,000 for 2016, $270,000 for 2017 and $275,000 for 2018). Supplemental Savings Plan account balances are paid only in cash to the Named Executive Officer upon termination of employment.
|
***
|
The value attributable to executive benefits for the Named Executive Officers. Beginning in 2007, the executives receive an annual cash executive benefit allowance in lieu of certain non-cash executive benefits. The cash executive benefit allowance paid to each Named Executive Officer during 2018 was $35,000. Other executive benefits made available to certain of the Named Executive Officers during 2018 included such things as security services and limited personal use of corporate event tickets, the corporate condominium, and the corporate leased jet. See “Executive Benefits” on page 45 for a full discussion of executive benefits.
|
|
DTE ENERGY
2019 PROXY STATEMENT
49
|
|
|
|
|
Estimated Possible Payouts
Under Non-Equity Incentive
Plan Awards (1)
|
|
Estimated Future Payouts
Under Equity Incentive Plan
Awards (2)
|
|
|
|
|
|
||||||||||||||||||
Name
|
|
Grant
Date
|
|
Threshold
($)
|
|
Target
Award
($)
|
|
Maximum
($)
|
|
Threshold
(#)
|
|
Target
Award
(#)
|
|
Maximum
(#)
|
|
All other
Stock
awards
(#) (3)
|
|
Exercise
or base
price
($/Sh)
|
Grant
date fair
value
($) (4)
|
||||||||||
Gerard M. Anderson
|
|
|
|
—
|
|
|
1,687,500
|
|
|
4,429,688
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
1/31/2018
|
|
|
|
|
|
|
|
—
|
|
|
46,336
|
|
|
92,672
|
|
|
|
|
$
|
105.64
|
|
4,894,935
|
|
||||
|
|
1/31/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,858
|
|
|
$
|
105.64
|
|
2,097,799
|
|
||||||
Peter B. Oleksiak
|
|
|
|
—
|
|
|
465,000
|
|
|
1,220,625
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
1/31/2018
|
|
|
|
|
|
|
|
—
|
|
|
10,300
|
|
|
20,600
|
|
|
|
|
$
|
105.64
|
|
1,088,092
|
|
||||
|
|
1/31/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,400
|
|
|
$
|
105.64
|
|
464,816
|
|
||||||
Trevor F. Lauer
|
|
|
|
—
|
|
|
436,000
|
|
|
1,144,500
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
1/31/2018
|
|
|
|
|
|
|
|
—
|
|
|
7,600
|
|
|
15,200
|
|
|
|
|
$
|
105.64
|
|
802,864
|
|
||||
|
|
1/31/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,300
|
|
|
$
|
105.64
|
|
348,612
|
|
||||||
David E. Meador
|
|
|
|
—
|
|
|
576,000
|
|
|
1,512,000
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
1/31/2018
|
|
|
|
|
|
|
|
—
|
|
|
11,500
|
|
|
23,000
|
|
|
|
|
$
|
105.64
|
|
1,214,860
|
|
||||
|
|
1/31/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,000
|
|
|
$
|
105.64
|
|
528,200
|
|
||||||
Gerardo Norcia
|
|
|
|
—
|
|
|
850,000
|
|
|
2,231,250
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
1/31/2018
|
|
|
|
|
|
|
|
—
|
|
|
19,700
|
|
|
39,400
|
|
|
|
|
$
|
105.64
|
|
2,081,108
|
|
||||
|
|
1/31/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,500
|
|
|
$
|
105.64
|
|
897,940
|
|
(1)
|
These dollar amounts represent the threshold, target and maximum calculated awards for the 2018 plan year under the Annual Incentive Plan. The various measures and details relating to the 2018 final awards are presented beginning on page 38. Annual incentive awards for the Named Executive Officers paid under the Executive Performance Plan prior to January 1, 2018 were intended to qualify as performance-based compensation under Section 162(m). See the discussion regarding the Internal Revenue Code Limits on Deductibility beginning on page 46.
|
(2)
|
The target column represents the number of performance shares granted to the Named Executive Officers under the Long-Term Incentive Plan on January 31, 2018. The performance measurement period for the 2018 grants is January 1, 2018 through December 31, 2020. Payments earned from the 2018 grants will be based on two performance measures weighted as follows: (i) total shareholder return vs. shareholder return of a custom peer group (80%) and (ii) balance sheet health - FFO to debt (20%) for Messrs. Anderson, Oleksiak, Meador and Norcia. For Mr. Lauer, payments earned from the 2018 grants will be based on three performance measures weighted as follows: (i) total shareholder return vs. shareholder return of a custom peer group (60%), (ii) balance sheet health - FFO to debt (20%), and (iii) DTE Electric average return on equity (20%). The final payouts, if any, will occur after the O&C Committee certifies the final results in early 2021. Beginning with 2010 performance share grants, dividends or dividend equivalents are not paid on unvested performance shares.
|
(3)
|
This column reports the number of shares of restricted stock granted under the Long-Term Incentive Plan to each of the Named Executive Officers on January 31, 2018. These shares of restricted stock will vest on January 31, 2021, assuming the Named Executive Officer is still actively employed by the Company on that date. Dividends on these shares of restricted stock are paid to the Named Executive Officer during the vesting period and are paid at the same rate as dividends paid to shareholders.
|
(4)
|
This column reports the grant date fair value of each equity award granted in 2018 computed in accordance with FASB ASC Topic 718.
|
50
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
|
Option Awards
|
|
Stock Awards
|
|||||||||||||||||
Name
|
|
Number of
Securities
Underlying
Unexercised
Options
Exercisable
|
|
|
|
Option
Exercise
Price ($)
|
|
Option
Expiration
Date
|
|
Number of
Shares
or Units of
Stock
That Have
Not Vested (2)
|
|
Market Value of
Shares or
Units of
Stock That Have
Not Vested (3)
|
|
Number of
Unearned
Shares,
Units
or Other
Rights That
Have Not
Vested (4)
|
|
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested (5)
|
|||||
Gerard M. Anderson
|
|
32500 (1)
|
|
|
|
43.95
|
|
|
2/25/2020
|
|
74,858
|
|
|
8,256,837
|
|
|
173,283
|
|
|
19,113,115
|
|
Peter B. Oleksiak
|
|
|
|
|
|
|
|
|
|
13,700
|
|
|
1,511,110
|
|
|
33,793
|
|
|
3,727,368
|
|
|
Trevor F. Lauer
|
|
|
|
|
|
|
|
|
|
9,200
|
|
|
1,014,760
|
|
|
22,520
|
|
|
2,483,956
|
|
|
David E. Meador
|
|
|
|
|
|
|
|
|
|
16,100
|
|
|
1,775,830
|
|
|
39,699
|
|
|
4,378,800
|
|
|
Gerardo Norcia
|
|
|
|
|
|
|
|
|
|
21,500
|
|
|
2,371,450
|
|
|
54,936
|
|
|
6,059,441
|
|
(1)
|
These stock options vested in three equal annual installments beginning on February 25, 2011.
|
(2)
|
The numbers in this column reflect the total number of unvested shares of restricted stock granted on February 3, 2016, February 1, 2017 and January 31, 2018. Each of these grants will vest on the third anniversary of the date of the grant.
|
(3)
|
The dollar value of the unvested shares of restricted stock reported in the preceding column valued at the closing price of DTE Energy common stock on December 31, 2018 ($110.30 per share).
|
(4)
|
The numbers in this column reflect the total number of unvested performance shares (rounded to the nearest whole share), at target level of performance, granted on February 3, 2016, February 1, 2017 and January 31, 2018. The payout, if any, will occur after the end of the three-year performance period.
|
(5)
|
The dollar value of the unvested performance shares reported in the preceding column valued at the closing price of DTE Energy common stock on December 31, 2018 ($110.30 per share).
|
|
|
Option Awards
|
|
Stock Awards
|
|||||||||||
Name
|
|
Number of Shares
Acquired
on Exercise
|
|
Value Realized
on
Exercise ($)
|
|
Number of Shares
Acquired
on Vesting
|
|
|
|
Value Realized
on
Vesting ($)
|
|||||
Gerard M. Anderson
|
|
47,500
|
|
|
3,025,853
|
|
|
23,000
|
|
|
(1
|
)
|
|
2,328,750
|
|
|
|
|
|
|
|
65,680
|
|
|
(2
|
)
|
|
6,938,435
|
|
||
Peter B. Oleksiak
|
|
|
|
|
|
3,700
|
|
|
(1
|
)
|
|
374,625
|
|
||
|
|
|
|
|
|
10,862
|
|
|
(2
|
)
|
|
1,147,462
|
|
||
Trevor F. Lauer
|
|
|
|
|
|
1,300
|
|
|
(1
|
)
|
|
131,625
|
|
||
|
|
|
|
|
|
3,998
|
|
|
(2
|
)
|
|
422,349
|
|
||
David E. Meador
|
|
|
|
|
|
5,700
|
|
|
(1
|
)
|
|
577,125
|
|
||
|
|
|
|
|
|
16,799
|
|
|
(2
|
)
|
|
1,774,646
|
|
||
Gerardo Norcia
|
|
|
|
|
|
5,400
|
|
|
(1
|
)
|
|
546,750
|
|
||
|
|
|
|
|
|
15,915
|
|
|
(2
|
)
|
|
1,681,261
|
|
(1)
|
This row is the number and related fair market value of the time-based restricted stock that was originally granted on February 12, 2015 and vested on February 12, 2018.
|
(2)
|
This row is the number of the performance shares that were originally granted on February 12, 2015, increased by dividend equivalents (assuming full dividend reinvestment at the fair market value on the dividend payment date) and related fair market value as of January 31, 2018, based upon performance measures described beginning on page 42 in “Long-Term Incentives.”
|
|
DTE ENERGY
2019 PROXY STATEMENT
51
|
•
|
“Cash Balance Plan” means the New Horizon Cash Balance component of the Retirement Plan (tax-qualified plan).
|
•
|
“DC ESRP” means the Defined Contribution component of the ESRP (nonqualified plan for tax purposes).
|
•
|
“ESRP” means the DTE Energy Company Executive Supplemental Retirement Plan (nonqualified plan for tax purposes).
|
•
|
“MSBP” means the Management Supplemental Benefit Plan (nonqualified plan for tax purposes), a component of the ESRP.
|
•
|
“Retirement Plan” means the DTE Energy Company Retirement Plan (tax-qualified plan).
|
•
|
“SRP” means the DTE Energy Company Supplemental Retirement Plan (nonqualified plan for tax purposes).
|
•
|
“Traditional Retirement Plan” means the DTE Traditional component of the Retirement Plan (tax-qualified plan).
|
Name
|
|
Plan Name
|
|
Number of Years
Credited
Service
|
|
Present Value of
Accumulated
Benefit ($)
|
||
Gerard M. Anderson
|
|
Traditional Retirement Plan
|
|
25.1
|
|
|
1,455,768
|
|
|
|
SRP
|
|
25.1
|
|
|
5,767,357
|
|
|
|
ESRP (1)
|
|
25.1
|
|
|
7,476,726
|
|
Peter B. Oleksiak
|
|
Cash Balance Retirement Plan
|
|
20.7
|
|
|
404,422
|
|
|
|
SRP
|
|
20.7
|
|
|
442,597
|
|
|
|
ESRP (1)
|
|
20.7
|
|
|
2,970,073
|
|
Trevor F. Lauer
|
|
Cash Balance Retirement Plan
|
|
13.5
|
|
|
289,102
|
|
|
|
SRP
|
|
13.5
|
|
|
373,449
|
|
|
|
ESRP
|
|
13.5
|
|
|
1,216,285
|
|
David E. Meador
|
|
Traditional Retirement Plan
|
|
21.8
|
|
|
1,239,072
|
|
|
|
SRP
|
|
21.8
|
|
|
2,024,599
|
|
|
|
ESRP (1)
|
|
31.8 (2)
|
|
|
5,165,037
|
|
Gerardo Norcia
|
|
Cash Balance Retirement Plan
|
|
16.2
|
|
|
250,377
|
|
|
|
SRP
|
|
16.2
|
|
|
741,497
|
|
|
|
ESRP
|
|
16.2
|
|
|
1,903,478
|
|
(1)
|
As described below, Messrs. Anderson, Oleksiak and Meador each have a choice between the MSBP and DC ESRP benefits. The ESRP number that is reported is the higher of the MSBP or DC ESRP.
|
(2)
|
For purposes of calculating the benefit under the MSBP only, Mr. Meador has 10 years of additional awarded service. Mr. Meador’s eligibility for the additional awarded service, granted at the time of hire, is subject to his meeting the eligibility requirements of the MSBP, which he has met. This additional time was granted to Mr. Meador as compensation for his unearned pension benefits from his previous employer. If additional service is awarded, the MSBP benefit is reduced by any benefit from the noncontributory portion of a prior employer’s retirement plan.
|
52
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
Traditional Retirement Plan:
The benefits provided under the Traditional Retirement Plan are based on an employee’s years of benefit service, average final compensation and age at termination of employment. Compensation used to calculate the benefits under the Traditional Retirement Plan consists of (i) base salary and (ii) lump sums in lieu of base salary increases for the highest five consecutive calendar years within the last 10 years prior to termination of employment. The monthly benefit at age 65 equals 1.5% for each year of credited service times the average final compensation. Early pension benefits are immediately available to any employee who has at least 15 years of service and has attained age 45. The benefit can be paid in one of various annuity options or in an immediate 100% lump sum payment. Messrs. Anderson and Meador are currently eligible for early pension benefits.
|
•
|
Cash Balance Plan:
The benefits provided under the Cash Balance Plan are expressed as a lump sum. The cash balance benefit increases each year with contribution credits and interest credits. Contribution credits equal 7% of eligible earnings (base salary and annual corporate incentive payments under the Annual Incentive Plan) for an employee with 30 years or less of credited service and 7.5% of eligible earnings for an employee with more than 30 years of credited service. Interest credits are based on the average 30-year Treasury rates for the month of September prior to the plan year. Interest on each year’s January 1 benefit is added the following December 31. The interest credit does not apply to the contribution for the current year. Upon termination of employment, a vested employee may, at any time, elect to receive the value of his benefit. If an employee elects to defer the benefit, interest credits will continue to accrue on the deferred benefit until the distribution of the benefit begins. An employee may elect to receive the benefit as a lump sum payout or as a monthly annuity, but not both. If an employee elects the lump-sum option, the entire lump sum is eligible to be rolled over to another qualified plan or IRA. Messrs. Lauer, Oleksiak and Norcia are currently eligible for the full value of their plan benefit.
|
•
|
SRP
: The benefits provided under the SRP are those benefits that would otherwise have been paid under the Retirement Plan but for the limitations imposed on qualified plans by the Internal Revenue Code. The benefits under the SRP are payable in a lump sum, in equal monthly installments for life or in annual installments from two to fifteen years.
|
•
|
ESRP
: The ESRP includes two components, the MSBP and the DC ESRP. Under the current terms of the ESRP, certain participants, including Messrs. Anderson, Oleksiak and Meador, will receive a choice at termination of employment of either the MSBP or DC ESRP benefit, but not both. Messrs. Lauer and Norcia are only eligible to participate in the DC ESRP component of the ESRP and not the MSBP component.
|
▪
|
MSBP:
Prior to January 1, 2001, many Company executives, including Messrs. Anderson, Oleksiak and Meador, participated in the MSBP. The MSBP was incorporated into the ESRP as of January 1, 2001. The MSBP requires an executive to be at least age 55 with 10 years of service to receive benefits. Messrs. Anderson and Meador are currently eligible for MSBP benefits.
|
|
DTE ENERGY
2019 PROXY STATEMENT
53
|
•
|
DC ESRP:
Effective January 1, 2001, we implemented the DC ESRP, a defined-contribution approach to nonqualified supplemental pension benefits. The DC ESRP approach was effective for most of the executives newly hired or promoted after that date. The DC ESRP provides for a benefit equal to a stated percentage of base salary and annual corporate incentive payments under the Annual Incentive Plan that is credited to a bookkeeping account on behalf of eligible executives. For the Named Executive Officers, the contribution percentage is 10%. The account value will increase or decrease based on the performance of the investment elections under the plan, as directed by the participants. Vesting of the benefit under the DC ESRP occurs at a rate of 20% per anniversary year. All of the Named Executive Officers are 100% vested in their DC ESRP accounts. The benefits under the DC ESRP are payable in a lump sum or annual installments from two to fifteen years. In the event of a change in control of the Company, executives who have entered into Change-In-Control Severance Agreements with the Company would receive an additional two years of compensation credits for purposes of the DC ESRP or any successor plan. See “Potential Payments Upon Termination of Employment” beginning on page 56 for further explanation of the change-in-control provision of the DC ESRP.
|
•
|
"Savings Plan" means the DTE Energy Company Savings and Stock Ownership Plan (tax-qualified 401(k) plan). The Savings Plan is made up of three distinct subdivisions, which originate from the merger of former plans. These subdivisions are generally referred to as the DTE Electric Savings Plan, the MCN Savings Plan and the Citizens Savings Plan. None of the Named Executive Officers participate in the MCN Savings Plan or the Citizens Savings Plan.
|
•
|
"Supplemental Savings Plan" means the DTE Energy Company Supplemental Savings Plan (nonqualified 401(k) plan).
|
54
DTE ENERGY
2019 PROXY STATEMENT
|
|
Name
|
|
Executive
Contributions in
Last Fiscal Year
($)(1)
|
|
Registrant
Contributions in
Last Fiscal Year
($)(2)
|
|
Aggregate Earnings
in Last Fiscal Year
($)(3)
|
|
Aggregate Balance
at Last Fiscal Year
End ($)
|
||||
Gerard M. Anderson
|
|
115,923
|
|
|
71,481
|
|
|
(175,618
|
)
|
|
4,246,061
|
|
Peter B. Oleksiak
|
|
49,192
|
|
|
27,185
|
|
|
(30,352
|
)
|
|
556,169
|
|
Trevor F. Lauer
|
|
34,961
|
|
|
21,381
|
|
|
(22,497
|
)
|
|
651,661
|
|
David E. Meador
|
|
53,046
|
|
|
39,785
|
|
|
(168,458
|
)
|
|
1,787,624
|
|
Gerardo Norcia
|
|
64,192
|
|
|
39,231
|
|
|
(27,669
|
)
|
|
816,625
|
|
(1)
|
During 2018, all of the Named Executive Officers were participants in the Supplemental Savings Plan. These amounts represent the amounts deferred from eligible compensation into the Supplemental Savings Plan.
|
(2)
|
These amounts are the Company matching contributions to the Supplemental Savings Plan for 2018 and are included in the “Summary Compensation Table” on page 48 as “All Other Compensation.”
|
(3)
|
These earnings represent the total investment income earned in 2018 on the various investment alternatives that can be selected and directed by participants. The aggregate earnings are not reported as compensation in the Summary Compensation Table.
|
|
DTE ENERGY
2019 PROXY STATEMENT
55
|
56
DTE ENERGY
2019 PROXY STATEMENT
|
|
Name
|
|
Severance
Amount
($)(1)
|
|
Bonus
($)(2)
|
|
Pension
Enhance-ment
($)(3)
|
|
Accelerated
LTIP
Awards
($)(4)
|
|
Out-
placement
($)(5)
|
|
Health &
Welfare
Benefits
($)(6)
|
|
Non-
Compete
($)(7)
|
|
Total ($)
|
||||||||
Gerard M. Anderson
|
|
6,075,000
|
|
|
1,687,500
|
|
|
1,059,096
|
|
|
27,369,843
|
|
|
202,500
|
|
|
62,600
|
|
|
3,037,500
|
|
|
39,494,039
|
|
Peter B. Oleksiak
|
|
2,170,000
|
|
|
465,000
|
|
|
2,120,143
|
|
|
5,238,478
|
|
|
93,000
|
|
|
42,400
|
|
|
1,085,000
|
|
|
11,214,021
|
|
Trevor F. Lauer
|
|
1,962,000
|
|
|
436,000
|
|
|
611,283
|
|
|
3,498,716
|
|
|
81,750
|
|
|
58,300
|
|
|
981,000
|
|
|
7,629,049
|
|
David E. Meador
|
|
2,592,000
|
|
|
576,000
|
|
|
63,965
|
|
|
6,154,630
|
|
|
108,000
|
|
|
59,100
|
|
|
1,296,000
|
|
|
10,849,695
|
|
Gerardo Norcia
|
|
3,400,000
|
|
|
850,000
|
|
|
714,927
|
|
|
8,430,781
|
|
|
127,500
|
|
|
57,600
|
|
|
1,700,000
|
|
|
15,280,808
|
|
(1)
|
The severance amount equals two times each Named Executive Officer’s base salary and target bonus as of December 31, 2018.
|
(2)
|
The bonus is equal to the Named Executive Officer’s base salary as of December 31, 2018 multiplied by the 2018 plan year AIP target.
|
(3)
|
The pension enhancement represents the present value of the additional two years of age and service awarded under the MSBP formula or two additional years of compensation credits awarded under the ESRP formula per the Change-In-Control Severance Agreements.
|
(4)
|
This column reflects the full value of stock options, performance shares and restricted stock granted under the Company’s Long-Term Incentive Plan, as of December 31, 2018, that would become payable in the event of a qualifying change in control.
|
(5)
|
Outplacement benefits are capped at 15% of each Named Executive Officer’s base salary.
|
(6)
|
This column includes family coverage costs for medical, dental and vision benefits for a 24-month period. Also included are life insurance, long-term disability insurance and accidental death and disability insurance for a 24-month period.
|
(7)
|
The consideration for the non-competition prohibition in the Change-In-Control Severance Agreement is 100% of each Named Executive Officer’s base salary and target bonus as of December 31, 2018.
|
|
DTE ENERGY
2019 PROXY STATEMENT
57
|
•
|
The resulting median employee is a union employee in our electric distribution operations group;
|
•
|
The median employee had a base salary rate, exclusive of overtime, of $86,623;
|
•
|
The annual total compensation of the median employee of the Company (other than Mr. Anderson, the Company's Chairman and CEO) was $120,861; and
|
•
|
The annual total compensation of Mr. Anderson, our Chairman and CEO, was $10,986,808.
|
Summary Compensation Table with Median Employee
|
||||||||||||||||||||||||||
|
|
|
Salary (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Year
|
|
Base Salary ($)
|
|
Overtime ($)
|
|
Stock Awards ($)
|
|
Option Awards ($)
|
|
Non-equity Incentive Comp ($)
|
|
Change in Pension Value ($)
|
|
Other Compensation ($)
|
|
Total ($)
|
|
2018 Pay Ratio
|
|||||||
Gerard M. Anderson
|
2018
|
|
1,344,231
|
|
|
0
|
|
|
6,992,734
|
|
|
0
|
|
2,500,000
|
|
|
0
|
|
149,843
|
|
|
10,986,808
|
|
|
91
|
|
Median Employee
|
2018
|
|
86,623
|
|
|
28,670
|
|
|
0
|
|
|
0
|
|
0
|
|
|
0
|
|
5,568
|
|
|
120,861
|
|
|
|
58
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
59
|
•
|
Calling regularly scheduled executive sessions of independent directors and presiding at such sessions;
|
•
|
Providing feedback regarding executive sessions, as appropriate, to the Chairman and CEO;
|
•
|
Serving as the liaison between the Chairman and CEO and the independent directors;
|
•
|
Approving the general scope and type of information to be presented at Board meetings;
|
•
|
Reviewing shareholder communications addressed to the Board or to the Lead Independent Director;
|
•
|
Making himself or herself available if requested by major shareholders, for direct consultation and communication with shareholders;
|
•
|
Organizing Board meetings in the absence of the Chairman, and presiding at any session of the Board where the Chairman is not present;
|
•
|
Consulting with the Chairman and CEO in the selection of topics to be discussed when developing the annual Board calendar;
|
•
|
Retaining independent advisors in consultation with the Board, on behalf of the Board as the Board determines to be necessary or appropriate;
|
•
|
Participating in the Organization and Compensation Committee’s annual review and approval of the CEO’s corporate goals and objectives and evaluation of the CEO’s performance; and
|
•
|
Collaborating with the Chairman and CEO and the Corporate Secretary on scheduling Board and committee meetings and approving the schedule of Board and Committee meetings.
|
60
DTE ENERGY
2019 PROXY STATEMENT
|
|
1.
|
Policies and procedures for making, with corporate funds or assets, contributions and expenditures (direct or indirect) to (a) participate or intervene in any campaign on behalf of (or in opposition to) any candidate for public office, or (b) influence the general public, or any segment thereof, with respect to an election or referendum.
|
2.
|
Monetary and non-monetary contributions and expenditures (direct and indirect) used in the manner described in section 1 above, including:
|
|
DTE ENERGY
2019 PROXY STATEMENT
61
|
62
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
63
|
1.
|
Elect eleven directors. The nominees are Gerard M. Anderson, David A. Brandon, W. Frank Fountain, Jr., Charles G. McClure, Jr., Gail J. McGovern, Mark A. Murray, Ruth G. Shaw, Robert C. Skaggs, Jr., David A. Thomas, James H. Vandenberghe and Valerie M. Williams for terms expiring in 2020. (See “Proposal No. 1 - Election of Directors” on page 5);
|
64
DTE ENERGY
2019 PROXY STATEMENT
|
|
2.
|
Ratify the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the year 2019. (See “Proposal No. 2 - Ratification of Appointment of Independent Registered Public Accounting Firm” on page 27);
|
3.
|
Provide an advisory vote to approve the Company’s executive compensation. (See “Proposal No. 3 - Advisory Proposal - Nonbinding Vote to Approve Executive Compensation” on page 30);
|
4.
|
Vote on shareholder proposals to require an independent board chairman and disclosure of political contributions. (See "Proposal No. 4 - Independent Board Chairman" on page 59 and "Proposal No. 5 - Disclosure of Political Contributions" on page 61).
|
5.
|
Consider any other business that may properly come before the meeting or any adjournments or postponements of the meeting. (See “Consideration of Any Other Business That May Come Before the Meeting” on page 63).
|
•
|
To vote through the Internet or by telephone, follow the instructions attached to your proxy card or meeting notice.
|
•
|
To vote by mail, sign and date each proxy card (if you receive a paper copy) and return it in the enclosed prepaid envelope.
|
•
|
To vote in person at the annual meeting, please see the instructions under
“How do I attend the annual meeting?”
on page 69 below. You may use your own proxy card to vote or use a blank one provided at the meeting.
|
|
DTE ENERGY
2019 PROXY STATEMENT
65
|
66
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
67
|
68
DTE ENERGY
2019 PROXY STATEMENT
|
|
|
DTE ENERGY
2019 PROXY STATEMENT
69
|
•
|
the name and address, as they appear on our books, of the shareholder making the proposal or nomination and of the beneficial owner, if any, on whose behalf the proposal or nomination is made;
|
•
|
the class and number of shares that are owned beneficially and of record by the shareholder making the proposal or nomination and by the beneficial owner, if any, on whose behalf the proposal or nomination is made; and
|
•
|
a representation that the person giving the notice is a shareholder of record entitled to vote at the annual meeting and intends to appear at the meeting in person or by proxy to make the nomination or propose the business specified in the notice.
|
•
|
the information that would be required to be disclosed in a proxy statement to comply with all applicable requirements of the Act and the rules and regulations thereunder as if each Shareholder Nominee had been nominated by the Board;
|
•
|
any additional information as necessary to permit the Board of Directors to determine if the Shareholder Nominee is independent under applicable listing standards, any applicable rules of the SEC and any publicly disclosed standards used by the Board in determining and disclosing the independence of the Company’s directors;
|
•
|
written representation and agreement of the Shareholder Nominee, in the form provided by the Secretary upon written request, relating to the Shareholder Nominee’s compliance, in his or her individual capacity and on behalf of any person or entity on whose behalf the nomination is being made, if elected as a director, with the Company’s corporate governance, conflict of interest, confidentiality and stock ownership and trading policies and guidelines, any other Company code of conduct, policies and guidelines or any rules, regulations and listing standards, in each case as applicable to Company directors; and
|
•
|
a written representation and agreement of the Shareholder Nominee, that such person (i) is not and will not become a party to any agreement or understanding with, and has not given any commitment or assurance to, any person or entity as to how such person, if elected as a director of the Company, will act or vote on any issue or question, and (ii) is not and will not become a party to any agreement, arrangement or understanding with any person or entity other than the Company with respect to any direct or indirect compensation, reimbursement or indemnification in connection with service or action as director unless the terms of such agreement, arrangement or understanding have been provided to the Company.
|
70
DTE ENERGY
2019 PROXY STATEMENT
|
|
•
|
a description in reasonable detail of the business desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting; and
|
•
|
any material interest the shareholder or the beneficial owner, if any, on whose behalf the proposal is made, has in the matter.
|
|
DTE ENERGY
2019 PROXY STATEMENT
71
|
|
|
Shareowner Services
P.O. Box 64945
St. Paul, MN 55164-0945
|
|
|
Address Change? Mark box, sign, and indicate changes below:
¨
|
|
TO VOTE BY INTERNET OR TELEPHONE, SEE REVERSE SIDE OF THIS PROXY CARD.
|
(Instructions: To withhold authority to vote for any indicated nominee, write the number(s) of the nominee(s) in the box provided to the right.)
|
|
|
|
||||||
Proposal 2.
|
Ratify the appointment of PricewaterhouseCoopers LLP as our independent auditors.
|
|
|
¨
|
For
|
¨
|
Against
|
¨
|
Abstain
|
Proposal 3.
|
Provide a nonbinding vote to approve the Company's executive compensation.
|
|
|
¨
|
For
|
¨
|
Against
|
¨
|
Abstain
|
Proposal 4.
|
Vote on a shareholder proposal to require an independent board chairman.
|
|
|
¨
|
For
|
¨
|
Against
|
¨
|
Abstain
|
Proposal 5.
|
Vote on a shareholder proposal to require additional disclosure of political contributions.
|
|
|
¨
|
For
|
¨
|
Against
|
¨
|
Abstain
|
Date
|
|
Signature(s) in Box
|
|
|
Please sign exactly as your name(s) appears on your Proxy. If held in joint tenancy, all persons should sign. Trustees, administrators, etc., should include title and authority. Corporations should provide the full name of the corporation and the title of the authorized officer signing the Proxy.
|
:
|
|
(
|
|
*
|
INTERNET/MOBILE
|
|
PHONE
|
|
MAIL
|
www.proxypush.com/dte
|
|
1-866-883-3382
|
|
|
Use the Internet to vote your proxy
until 11:59 p.m. (EDT) on
May 8, 2019.*
|
|
Use a touch-tone telephone to
vote your proxy until 11:59 p.m.
(EDT) on May 8, 2019.*
|
|
Mark, sign and date your proxy
card and return it in the
postage-paid envelope provided.
Mailed copies must be received
by 11:59 p.m. (EDT) on May 8, 2019.
|