Form 4: Ferrellgas Director Michael Morrissey Awarded 12,729 Phantom Units

Ferrellgas Partners L.P. Director Michael F. Morrissey was granted 12,729 Phantom Units, aligning his interests with shareholders and vesting on September 25, 2025.

Summary

• Michael F. Morrissey, a Director of Ferrellgas Partners L.P., was granted 12,729 Phantom Units on July 1, 2025.
• These Phantom Units represent the economic equivalent of one Class A Unit each and accrue dividend equivalent rights.
• The units are scheduled to vest on September 25, 2025.
• Payment for vested units will occur following the first to occur of: termination of service from the Board of Directors, a change of control, or the third anniversary of the July 1, 2025 grant date.
• The payment amount will be equal to the average closing price of a Class A Unit for the 10 trading days immediately preceding the payment trigger event.

Sentiment

Score: 7

Explanation: The grant of equity awards to a director is generally positive as it aligns their interests with shareholders and incentivizes long-term performance, reflecting a commitment to retention and value creation.

Positives

• The grant of 12,729 Phantom Units to a Director aligns management's interests with shareholder value, as the value of the units is tied to the Class A Unit price.
• The Phantom Units accrue dividend equivalent rights, providing additional incentive and mirroring shareholder benefits.
• Vesting conditions tie the award to continued service or specific corporate events, promoting long-term commitment.

Risks

• The ultimate value of the Phantom Units is tied to the future Class A Unit price, which is subject to market fluctuations.
• Payment for the vested units is contingent on specific future events (termination of service, change of control, or the third anniversary of the grant date), introducing a timing uncertainty for the cash realization.

Future Outlook

The Phantom Units are designed to vest on September 25, 2025, with payment contingent on future events such as termination of service, a change of control, or the third anniversary of the grant date, linking the director's long-term compensation to the company's performance and strategic outcomes.

Industry Context

Equity awards like Phantom Units are a common form of executive and director compensation across various industries, particularly in publicly traded companies, to align the interests of leadership with long-term shareholder value. This is standard practice for incentivizing directors and promoting retention.

Comparison to Industry Standards

• The use of Phantom Units is a common equity-based compensation tool, similar to restricted stock units (RSUs) or performance share units (PSUs) used by companies like Enterprise Products Partners L.P. (EPD) or Plains All American Pipeline, L.P. (PAA) in the energy sector, which often utilize such awards to retain and incentivize key personnel.
• The vesting schedule, with a specific future date (September 25, 2025) and triggers like termination or change of control, is consistent with typical long-term incentive plans seen across the S&P 500, aiming to foster long-term commitment and strategic alignment.
• The accrual of dividend equivalent rights is also a standard feature in many equity compensation plans, ensuring that award holders benefit from distributions similar to common shareholders, comparable to practices at companies like Kinder Morgan, Inc. (KMI).

Corporate Governance

Related Party Transactions

• The transaction involves the grant of equity compensation to a director, which is a standard related party transaction for executive and board compensation.

Stakeholder Impact

• Shareholders: Positive impact due to increased alignment of the director's interests with shareholder value and long-term company performance.
• Employees: No direct impact mentioned.
• Customers: No direct impact mentioned.
• Suppliers: No direct impact mentioned.
• Creditors: No direct impact mentioned.

Next Steps

• Vesting of the 12,729 Phantom Units on September 25, 2025.
• Potential future cash payment upon specific trigger events (termination of service, change of control, or the third anniversary of the grant date).

Key Dates

Recommendation

Keywords

Ferrellgas, Phantom Units, Class A Units, Director Compensation, Equity Award, Insider Transaction, SEC Form 4, Corporate Governance, Executive Compensation