SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.    )

Filed by the Registrant    ☒

Filed by a Party other than the Registrant    ☐

Check the appropriate box:

UNITIL CORPORATION

(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

☒    No fee required.

☐    Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

☐    Fee paid previously with preliminary materials.

☐    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.

March 19, 2018

Dear Fellow Shareholder,

I am pleased to invite you to attend the Unitil Corporation Annual Meeting of Shareholders. The meeting will be held on Wednesday, April 25, 2018, at 11:30 a.m., at the Company’s corporate headquarters, 6 Liberty Lane West, Hampton, New Hampshire. This year, we are asking shareholders to vote on the election of one director, and on the ratification of the selection of independent registered public accountants. Also this year, shareholders will be presented with an advisory vote on executive compensation.

Your vote is very important. I encourage you to vote to ensure that your voice is represented at the meeting, and to play a part in the future of the Company. The enclosed proxy materials provide important information about the Company to assist you with your voting decisions, as well as instructions to submit your vote.

I would like to thank you for choosing to invest in Unitil Corporation. The Company’s vision statement and philosophy reflect our deep commitment to our shareholders, customers, local communities and partners. We provide more than just electricity and gas services and products. Our talented and dedicated people are proud to provide for the necessities of life with the safe and reliable delivery of natural gas and electricity throughout New England. Energy for life is the statement of pride and commitment that we use to describe this philosophy.

On behalf of the directors and management of Unitil Corporation, thank you for your continued support and confidence in 2018.

Sincerely,

Robert G. Schoenberger

Chairman of the Board,

Chief Executive Officer and

President

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

The Board of Directors and management of Unitil Corporation (the “Company”) is pleased to invite you to attend the 2018 Annual Meeting of Shareholders, which will be held at the office of the Company, 6 Liberty Lane West, Hampton, New Hampshire, on Wednesday, April 25, 2018, at 11:30 A.M. for the following purposes:

The Board of Directors set February 16, 2018 as the date for determining holders of record of common stock who are entitled to notice of and to vote at the meeting or at any adjournments or postponements of the meeting. The Board of Directors has directed the Company to prepare this notice, the accompanying proxy statement, and the accompanying annual report, and to send them to you.

By Order of the Board of Directors,

Sandra L. Whitney

Corporate Secretary

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON WEDNESDAY, APRIL 25, 2018 This notice, the accompanying proxy statement and the accompanying annual report to shareholders are available for shareholders to view at www.proxydocs.com/UTL.

YOUR VOTE IS IMPORTANT

Your vote is important. To ensure a quorum is present at the Annual Meeting of Shareholders,

please be sure your shares are represented at the meeting.

You may vote in one of the following ways:

ATTENDING THE ANNUAL MEETING OF SHAREHOLDERS

All shareholders who wish to attend the Annual Meeting of Shareholders in person are encouraged to do so. However, to ensure that the meeting remains orderly and secure, you must follow certain protocols for admittance. Shareholders of record will need to provide their admission ticket or their name and government-issued picture identification. Beneficial owners will need to provide a copy of an account statement from the bank, broker or nominee holding the shares as proof of ownership as of the Record Date, as well as government-issued picture identification.

TABLE OF CONTENTS

PROXY STATEMENT

Unitil Corporation

6 Liberty Lane West

Hampton, NH 03842-1720

March 19, 2018

PROXY STATEMENT

Unitil Corporation (“Unitil” or the “Company”) is providing this proxy statement and the accompanying annual report (which includes the Company’s Annual Report on Form 10-K for fiscal year 2017) to shareholders in connection with the Company’s 2018 Annual Meeting of Shareholders (the “Annual Meeting”). The Company’s Board of Directors (the “Board”) is soliciting your designation of a proxy to vote your shares at the Annual Meeting. As a shareholder of the Company, you are invited to attend the Annual Meeting, as well as entitled and requested to vote (if you are a shareholder of record) or to provide voting instructions (if you beneficially own your shares in street name) on the proposals described in this proxy statement. This proxy statement provides information to assist you in voting your shares or in providing voting instructions with respect to your shares.

The Company has the following subsidiaries, which are referred to throughout this proxy statement: Fitchburg Gas and Electric Light Company (“Fitchburg”); Granite State Gas Transmission, Inc. (“Granite”); Northern Utilities, Inc. (“Northern”); Unitil Energy Systems, Inc. (“Unitil Energy”); Unitil Power Corp.; Unitil Realty Corp.; Unitil Resources, Inc.; Unitil Service Corp.; and Usource, Inc. and Usource, LLC (collectively, “Usource”).

Date, Time and Place

The Annual Meeting will be held on Wednesday, April 25, 2018 at 11:30 A.M. at the office of the Company, 6 Liberty Lane West, Hampton, New Hampshire.

Anticipated Mailing Date

The Company anticipates first mailing definitive copies of this proxy statement, the accompanying proxy card, and the accompanying annual report to shareholders on or about March 19, 2018.

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MEETING SUMMARY

This year, we are seeking your vote on the following proposals:

RECORD DATE & NUMBER OF SHARES OUTSTANDING

You are entitled to receive notice of and to vote at the Annual Meeting if you owned shares of the Company’s common stock as of the close of business on February 16, 2018 (the “Record Date”). As of the Record Date, the Company had 14,855,173 shares of common stock issued and outstanding and entitled to vote at the Annual Meeting.

QUORUM & REQUIRED VOTE

A majority of the outstanding shares of common stock entitled to vote at the Annual Meeting must be present in person or represented by proxy to conduct the Annual Meeting. This is referred to as a quorum.

If a quorum is present, the nominee standing for election as a Director will be elected by a plurality of the votes cast by the shareholders. Votes withheld and broker non-votes will not be counted toward the achievement of a plurality. Additional information concerning the election of directors appears in the section entitled Corporate Governance—Resignation Policy. With respect to all other matters that may come before the Annual Meeting, action on a matter is approved if the votes cast favoring the action exceed the votes cast opposing the action. Therefore, abstentions and broker non-votes will have no effect on the other matters. Representatives of the Company’s transfer agent will count the votes and certify the results.

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VOTING RIGHTS AND PROCEDURES

As an owner of Unitil common stock, it is your legal right to vote (or to provide voting instructions) on all matters to be considered at a shareholder meeting. Unitil hopes you will exercise your legal right and fully participate as a shareholder in the Annual Meeting. You may cast one vote for each share of common stock that you own on all matters presented at the Annual Meeting.

BENEFICIAL HOLDERS You may vote your shares in one of the following ways: in person at the Annual Meeting—but you must first obtain a properly completed legal proxy from your bank, broker or other nominee that will provide you with the right to vote the shares at the Annual Meeting direct your bank, broker or other nominee on how to vote your shares by following the instructions provided by the bank, broker or other nominee You may change how your bank, broker, or other nominee will vote your shares at any time before the vote is taken at the Annual Meeting: follow the procedures provided by your bank, broker or other nominee to make a change RECORD HOLDERS You may vote your shares in one of the following ways: in person at the Annual Meeting by designating another person (the “proxy”) to vote on your behalf by delivering a properly completed proxy card or submitting a proxy via the Internet at www.investorvote.com/UTL You may revoke your designation of a proxy at any time before the vote is taken at the Annual Meeting in one of the following ways: file with Unitil’s Corporate Secretary a later-dated written notice of revocation deliver to Unitil’s Corporate Secretary a properly completed, later-dated proxy card relating to the same shares submit a later-dated proxy via the Internet if the original designation of a proxy was made via the Internet attend the Annual Meeting and vote in person (although attendance at the Annual Meeting will not in and of itself constitute a revocation of a proxy)

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Brokerage firms have the authority under New York Stock Exchange rules to vote shares for which their customers do not provide voting instructions on routine matters. The ratification of the selection of Unitil’s independent registered public accounting firm, Deloitte & Touche LLP, for fiscal year 2018 is considered a routine matter. When a proposal is not routine and the brokerage firm has not received voting instructions from its customers, the brokerage firm cannot vote the shares on that proposal. Those shares are considered “broker non-votes.” Please note that, under New York Stock Exchange rules, this means that brokers may not vote your shares on Proposals 1 and 3 at the 2018 Annual Meeting if you have not given specific instructions as to how to vote to the broker. Please be sure to give specific voting instructions to your broker so that your vote can be counted.

MESSAGE FROM THE CHAIRMAN AND CEO

The Company’s Mission Statement states that we provide energy for life by safely and reliably delivering natural gas and electricity in New England. We are committed to the construction, operation, and maintenance of high-quality, reliable, and safe gas and electric distribution systems and to the provision of convenient and responsive service to all customers. This commitment requires a dedicated and well-trained work force and a corporate culture built on integrity, accountability, and results.

In 2017, the Company met the strategic goals for shareholders and, at the same time, with a perpetual vision for the future, we acted to help ensure our shareholders of continued value and growth. Through a seamless pursuit of excellence in operations, we also made the customer experience our highest priority. We accomplished these objectives by adhering to our core business values, by remaining flexible in our approach to problems and by rewarding outstanding teamwork.

Unitil’s leadership team consists of professionals with decades of experience in the utility, energy, and environmental industries. They reflect Unitil’s long-standing dedication to inspired teamwork, constant collaboration, and the insistence on the highest possible standards for ethical business practices. Fully accountable to our customers for the quality, efficiency, and integrity of our services, our leadership is ultimately accountable to the Board of Directors and to you, our shareholders. We seek to safeguard and enhance your investment in Unitil, while serving the best interests of all of the Company’s stakeholders.

Your Company is in the good hands of hundreds of talented and motivated people. I thank them for their loyalty and dedication to the Company, its customers and its shareholders, and I look forward to the Company’s continued success.

March 19, 2018

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The table below shows Executive Officers’ biographical information as of the date of this proxy statement, including the Named Executive Officers. Additional information about Mr. Schoenberger is included in the section entitled Recent Events. Additional information about Mr. Meissner is included in the sections entitled Recent Events and Proposal 1: Election of Director.

MANAGEMENT INFORMATION TABLE

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On March 1, 2018, the Company announced that Robert G. Schoenberger will retire as chairman of the board, president and chief executive officer of the Company on April 25, 2018. Mr. Schoenberger has also decided not to stand for re-election to the Board of Directors (the “Board”) at the Annual Meeting on April 25, 2018. As part of the Company’s leadership succession plan, Thomas P. Meissner, Jr., the Company’s senior vice president and chief operating officer, was selected by the Board to succeed Mr. Schoenberger as chairman of the board, president and chief executive officer concurrent with Mr. Schoenberger’s retirement on April 25, 2018. Mr. Meissner has been nominated by the Board to stand for election for a term of three years at the Annual Meeting. Expanded biographical information for Mr. Meissner is included in the section entitled Proposal 1: Election of Director.

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The following table sets forth information on the beneficial ownership of the Company’s common stock as of the Record Date, by (i) each person known to the Company to be the beneficial owner of more than five percent of its common stock, (ii) each Director and nominee for Director of the Company, (iii) each executive officer named in the Summary Compensation Table in the section entitled Compensation—Compensation of Named Executive Officers (the “Named Executive Officers”) and (iv) all Directors and executive officers (“Executive Officers”) of the Company as a group. Except as otherwise indicated, to the Company’s knowledge, the beneficial owners listed have sole voting and sole dispositive power with respect to the shares beneficially owned by them. The address of each of Unitil’s Directors and Executive Officers is c/o Unitil Corporation, 6 Liberty Lane West, Hampton, New Hampshire 03842-1720.

BENEFICIAL OWNERSHIP

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 NOTES:

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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 (“Exchange Act”) requires the Company’s Executive Officers, Directors, and persons who own more than ten percent of a registered class of the Company’s equity securities to file certain reports of ownership and changes in share ownership with the Securities and Exchange Commission (“SEC”) and the New York Stock Exchange (“NYSE”). Based upon its review of such forms that were filed in 2017, and written representations from certain reporting persons that such forms were not required to be filed by those persons for the reporting year 2017, the Company believes that all filing requirements applicable to its officers and Directors during 2017 and through February 2018, were met.

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The Board and the Company are committed to comprehensive and effective corporate governance practices. The Board believes that good corporate governance is a key to the long-term success of the Company, and essential to ensure that Unitil is operated in the best interest of shareholders and other stakeholders. Accordingly, the Board has unconditionally adopted Corporate Governance Guidelines and Policies of the Board (the “Guidelines”), as described below, to assist Directors in the pursuit of superior Board function, effectiveness, communication and transparency in the governance of the Company. The Board and the Company believe that the ethical character, integrity and principles of the Board and senior management remain the most important safeguards of good corporate governance.

The Guidelines represent the current view of the Board of Directors on governance and should not be viewed as rigid restraints. The Company will continue to monitor new developments and regulations mandated by the SEC and by the NYSE, as well as emerging issues concerning corporate governance and financial disclosure, and will adopt changes and institute new policies and procedures as appropriate. The Guidelines are reviewed regularly and are subject to modification from time to time by the Board of Directors. The Guidelines are available for review on the Corporate Governance page of the Investor Relations section of the Company’s website at www.unitil.com/investors, and are available in print to any shareholder or other interested party free of charge upon request to the Corporate Secretary at 1-800-999-6501 or at the address listed in the section entitled Information about the Annual Meeting.

GOVERNANCE POLICIES OF THE BOARD

EXPECTATIONS OF DIRECTORS fulfill fiduciary duties to the Company and its shareholders with proper oversight of the development of Company policy and strategy, and assessment of the Company’s operational effectiveness and financial strength; apply superior business judgment and leadership, and effectively exercise the duties of loyalty and care; avoid any conflict of interest; promote a high standard of personal integrity and adhere to the letter and spirit of Unitil’s Code of Ethics; and challenge management to commit to the highest attainable goals, and hold management accountable for its commitments.

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CODE OF ETHICS

The Company’s Code of Ethics (the “Code of Ethics”) is a statement of the Company’s high standards for ethical behavior, legal compliance and financial disclosure, and is applicable to all Directors, officers and employees of the Company and its subsidiaries. The Board unanimously approved the Code of Ethics in 2004, and annually affirms understanding of, and agreement and compliance with, the Code of Ethics. The Nominating and Governance Committee reviews the Code of Ethics annually for any required or desirable revisions. Should the Board adopt any changes to, or waivers of, the Code of Ethics, those changes or waivers will be promptly disclosed and posted on the Company’s website at the address noted below, as required by law, rule or regulation. A copy of the Code of Ethics can be viewed on the Company’s website at www.unitil.com/investors.

DIRECTOR INDEPENDENCE

Unitil’s Guidelines stipulate that a majority of the members of the Board, and all members of the Audit, Compensation and Nominating and Governance Committees, must be independent (as defined in Section 303A.02 of the NYSE Listed Company Manual—Corporate Governance Standards). As a listed company on the NYSE, Unitil must adhere to the independence standards set forth by the NYSE, and the Board has formally adopted independence criteria corresponding to the NYSE rules for director independence. The NYSE Listed Company Manual includes additional independence requirements for Audit Committee and Compensation Committee members. In addition, Rule 10A-3 of the Securities Exchange Act of 1934 (the “Exchange Act”) includes additional independence requirements for Audit Committee members.

Unitil’s Corporate Governance Guidelines, as well as the NYSE independence standards, require that the Board annually affirm the independent status of non-employee or “outside” Directors. The Board makes this affirmation annually in January, and based on its last comprehensive review on January 30, 2018, the Board determined at that time that, with the exception of Mr. Schoenberger, all of the Board members are independent.

During its annual independence review and affirmation, the Board applies the independence standards set forth in the Company’s Guidelines and by the NYSE. Under these requirements, the members of the Board who qualify as independent must be free from any material relationship that would interfere with the exercise of independent judgment as a member of the Board. An independent Director is one for whom the Board has affirmatively determined that he or she, individually or through a member of his or her immediate family, does not have or has not had management responsibility with the Company or otherwise been affiliated with the Company for the past three years and who has no material relationship with the

AFFIRMED AS INDEPENDENT January 30, 2018 Robert V. Antonucci Michael B. Green David P. Brownell Eben S. Moulton Lisa Crutchfield M. Brian O’Shaughnessy Albert H. Elfner, III Sarah P. Voll Edward F. Godfrey David A. Whiteley

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Company, either directly or as a partner, shareholder or officer of an organization with such a relationship with the Company. This definition generally leaves the Board the discretion to determine, on a case-by-case basis, what constitutes a “material relationship” with the Company. The Board exercises this discretion in a manner that is consistent with applicable NYSE and SEC regulations and standards. In addition, members of the Board are obligated to notify the full Board of any material changes in their relationships that may affect their independence status as determined by the Board. The obligation encompasses all relationships between Directors and the Company and its subsidiaries and/or members of senior management.

RISK OVERSIGHT

The Board is responsible for the oversight of management and the business affairs of the Company, which includes the oversight of risk. The Board’s ultimate goals are to ensure that Unitil continues as a successful business, to optimize financial returns in light of the business risks, to increase shareholder value over time, and to protect the interests of all stakeholders.

The Company has a formal Enterprise Risk Management (“ERM”) program which is overseen by the Board. The ERM program is a foundation for risk management that is relevant, sustainable and scalable. The ERM program is designed to identify potential risks that may impact the Company, and to manage risks within the Company’s risk appetite in order to sustain operations and achieve business objectives. In building the ERM program, the potential risks relating to the Company’s business were defined using a comprehensive set of risk disclosures which are described in Part I, Item 1A. Risk Factors of the Company’s Annual Report on Form 10-K filed with the SEC on February 1, 2018.

The Board has assigned the Executive Committee the responsibility of assisting the Board in overseeing the overall risk management strategy of the Company. In order to assist the Board with overall risk management, the Executive Committee is supported by and oversees the Risk Management Committee, which is comprised of the senior management team. Together, these two committees evaluate and provide direction with respect to risk identification and assessment, and risk management and mitigation, including the specific guidelines and policies governing the process by which risk assessment and risk management are undertaken at the Company.

Like all companies, Unitil faces a variety of risks, both internal and external, and many factors work simultaneously to affect the Company’s overall business risk. The Board recognizes that the Company’s business risk is not static, and that it is not possible to mitigate all risk and uncertainty. The Board works within a climate of respect and candor, fostering a culture of open dialog between Board members and senior management. Overall, the Board believes that the ERM program has further defined and enhanced a systematic and proactive approach to properly oversee risk management and the ERM program will continue to evolve through ongoing review and assessment of the existing and emerging risks facing the Company.

LEADERSHIP STRUCTURE

The current leadership structure of the Board consists of a combined Chairman and Chief Executive Officer (“CEO”) position which has been held by Mr. Schoenberger since 1997. At this time, the Board believes that

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as a small-cap domestic corporation, the combination of these two positions is the optimal structure to guide the Company and maintain the focus required to achieve the Company’s long-term business goals. The CEO and president of the Company is the direct link between senior management and the Board. As a utility professional with over 35 years of industry experience, Mr. Schoenberger has provided critical insight and perception to the Board, as well as feedback to senior management, through his comprehensive understanding of the issues at hand. See also the section entitled Recent Events above.

In July 2017, the Board re-appointed Mr. Elfner to serve as the lead independent Director for the coming year. In his role as lead Director, Mr. Elfner, who also serves as the chairman of the Executive Committee and as a member of the Nominating and Governance Committee, presides at all meetings of the Board in executive session. Mr. Elfner also provides leadership and guidance to the Board on the fulfillment of its fiduciary duties, as well as matters of corporate governance. Mr. Elfner facilitates, with the assistance of the Corporate Secretary, results reporting to the Board with regard to the annual board evaluation on key Board and committee-related matters, and promotes the continuation of a collegial and mutually respectful Board culture. The existence and activities of the lead Director do not alter the traditional roles and responsibilities of the Board of Directors as a whole, or the Company’s management. As lead director, Mr. Elfner shall undertake any other action or exercise such other powers, authority, duties, and obligations as necessary or appropriate or as otherwise required by the listing standards of the NYSE or other applicable laws, rules or regulations, or as shall otherwise be determined by the Board.

RETIREMENT POLICY

The Board has a retirement policy that provides no Director may be nominated as a candidate, or for reelection, as part of the slate of Directors proposed for election by the Company, nor may any person be nominated as a candidate for Director, after he or she has reached age 75. Directors are not, however, subject to specific term limits. Due to the complexity of the utility industry, the Company values the insight that a Director is able to develop over a period of time. The Board believes that tenure provides an enhanced contribution to the Board, including the benefits of valuable experience and familiarity, which is in the best interest of shareholders.

STOCK OWNERSHIP POLICY

The Board has a mandatory stock ownership policy that is applicable to all members of the Board. The Board is of the continuing belief that its members should own a significant number of shares of the Company’s common stock to properly align their interests with those of the shareholders of the Company. Effective as of January 1, 2013, all Directors must own shares of the Company’s common stock in the equivalent value of three times the current annual cash retainer for Board service. Shares of restricted stock and restricted stock units (“RSUs”) are counted towards this total. The ownership requirement is calculated annually on January 1, and as of January 1, 2018, the ownership requirement was $195,000 in value. Currently, all Board members meet the stock ownership requirement. Any new Director who may join the Board in the future will have four years from the date of first election to the Board by shareholders to accumulate the required number of shares of common stock.

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RESIGNATION POLICY

The Board has a policy that requires a Director to tender his or her resignation if he or she should receive a “withhold” vote greater than 50% of the shares voted at the annual meeting of shareholders in an uncontested election. If an incumbent Director fails to receive the required vote for re-election, the Nominating and Governance Committee will act on an expedited basis to determine whether to recommend the acceptance of the Director’s resignation and will submit such recommendation for prompt consideration by the Board. The Director whose resignation is under consideration shall abstain from participating in any decision regarding that resignation. The Nominating and Governance Committee and the Board may consider any factors they deem relevant in deciding whether to accept a Director’s resignation.

Further, the Board shall nominate for election or re-election as Director only candidates who agree to tender, promptly following the annual meeting at which they face election or re-election as Director, irrevocable resignations that will be effective upon (i) the failure to receive the required vote at the annual meeting at which they face re-election and (ii) Board acceptance of such resignation. In addition, the Board will fill board seat vacancies and new directorships only with candidates who agree to tender, promptly following their appointment to the Board, the same form of resignation tendered by other Directors in accordance with this policy.

ANNUAL EVALUATION

The Board conducts an annual evaluation on key Board- and committee-related issues, an exercise that has been practiced since 2002. The annual evaluation has proven to be a beneficial tool in the process of continuous improvement in Board and committee functioning and communication. The evaluation is specifically designed to provide a platform for qualitative expression of thoughts and opinions, as well as a catalyst for candid discussion and open dialog on current and emerging issues facing the utility industry, the Board as a whole, any committee(s) served upon, matters of strategic importance to the Company, as well as self-evaluation with regard to skills and expertise. In 2017, all Directors participated in the annual evaluation, which was conducted in the fourth quarter. Responses were discussed in executive session in January 2018.

MEETING ATTENDANCE

Directors are expected to make a determined effort to attend all meetings of the Board and applicable committees upon which they serve. In 2017, the Board held four meetings, and the committees held a total of 21 meetings, collectively. Overall, Directors attended 98% of the meetings held in 2017. No Director attended less than 75% of the aggregate number of meetings of the Board and applicable committees.

Directors are encouraged to attend the Annual Meeting, although there is no formal requirement to attend. In 2017, ten Directors attended the annual meeting of shareholders.

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EXECUTIVE SESSIONS

Non-employee members of the Board have the opportunity to meet in executive session, without members of management present, either prior to the start or following the adjournment of each Board and committee meeting. During 2017, the Board met in executive session on four occasions and the lead Director, Mr. Elfner, presided at these meetings.

COMMUNICATION WITH THE BOARD

Shareholders and other interested parties who desire to communicate with the Board, a committee of the Board, the non-management or independent Directors as a group, or an individual member of the Board may do so in writing by sending a letter c/o Corporate Secretary, Unitil Corporation, 6 Liberty Lane West, Hampton, New Hampshire 03842-1720 or via email to whitney@unitil.com. The Company will screen such correspondence for security purposes. The Corporate Secretary will determine whether the communication relates to business matters that are relevant to the Company and, if so, promptly forward the communication to the appropriate Director(s).

NOMINATIONS

The Nominating and Governance Committee is responsible for recommending to the Board the slate of Director nominees for election by shareholders. The Board reviews and, as appropriate, approves all Director nominees prior to annual proxy material preparation. As provided in Article III of the Company’s Bylaws, any vacancy occurring in the Board, whether due to the death, resignation or other inability to serve of any Director previously elected may be filled by the affirmative vote of a majority of the remaining Directors. A Director elected to fill a vacancy shall be elected for the unexpired term of his or her predecessor in office.

The Committee determines the required selection criteria and qualifications of Director nominees based upon the needs of the Company at the time nominees are considered. See also the section entitled Corporate Governance—Corporate Governance Policies of the Board—Board Diversity below. Director candidates will be selected based on input from Directors, Executive Officers, and if the Committee deems appropriate, a third-party search firm. Minimum criteria for Director nominees are set forth below, as well as in the Corporate Governance Guidelines. A candidate must possess the ability to apply good business judgment and must be in a position to properly exercise his or her duties of loyalty and care. Candidates with potential conflicts of interest or who do not meet independence criteria will be identified and disqualified, as appropriate. In addition to independence criteria, the Committee will consider criteria including integrity, judgment, proven leadership capabilities, business experience, areas of expertise, availability for service, factors relating to the composition of the Board, such as size and structure, and also the Company’s policies and principles concerning diversity. The Board seeks to include diversity of backgrounds, perspectives, experience and skills among its members. The Committee will consider these criteria for nominees identified by the Committee, by other Directors, by shareholders, or through another source. When current Board members are considered for nomination for reelection, the Committee also takes into consideration their prior Board contributions, performance and meeting attendance records.

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The Committee conducts a process of making a preliminary assessment of each proposed nominee based upon the resume and biographical information, an indication of the individual’s willingness to serve and other background information. This information is evaluated against the criteria set forth above as well as the specific needs of the Company at that time. Based upon a preliminary assessment of the candidate(s), those who appear best suited to meet the needs of the Company may be invited to participate in a series of interviews, which are used for further evaluation. On the basis of information collected during this process, the Committee determines which nominee(s) to recommend to the Board to submit for election at the next annual meeting of shareholders, or to fill vacancies on the Board that occur between shareholder meetings. The Committee uses the same process for evaluating all nominees, regardless of the source of the nomination. The Board may elect, at its discretion, to participate in an additional round(s) of interviews with one or all candidate(s) recommended by the Committee.

Shareholders who wish to recommend a nominee for consideration by the Committee may do so by sending the following information to the Committee c/o the Corporate Secretary at the address listed in the section entitled Corporate Governance—Governance Policies of the Board—Communication with the Board: (1) the name of the candidate with brief biographical information and his or her resume; (2) contact information for the candidate and a document evidencing the candidate’s willingness to serve as a Director if elected; and (3) a signed statement as to the submitting shareholder’s current status as a shareholder and proof of ownership of the number of shares currently held.

Additionally, nominations of persons for election to the Board may be made by any shareholder of the Company by submitting a nomination in compliance with all procedures set forth in Article IV – Nomination of Directors of the Company’s Bylaws.

No candidates for Director nominees were submitted to the Committee by any shareholder in connection with the Annual Meeting.

QUALIFICATIONS & SKILLS OF DIRECTORS

The Board believes there are general qualifications that all Directors must exhibit, and other qualifications, attributes, skills and experience that should be represented on the Board as a whole, but not necessarily by each Director.

Qualifications Required of All Directors

The Board requires that each Director be a person of high integrity and superior ethical character with a proven record of leadership and accomplishment in his or her chosen field. Each Director must demonstrate innovative and independent thinking, understand complex principles of business, finance, and utility regulation, and demonstrate familiarity with and respect for corporate governance requirements and practices. Directors must also comply unequivocally with the Code of Ethics, and be free of conflicts or potential conflicts of interest, and outside Directors must meet the requirements of independence as set forth by the NYSE, as appropriate. Directors must be willing and able to dedicate the proper amount of time and effort to service on the Board as necessary to fulfill his or her responsibilities to the Company, and must not serve on more than two public company boards if currently holding a position of chief executive officer or an equivalent position, or on more than three public company boards if retired.

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Qualifications, Attributes, Skills and Experience to be Represented on the Board

The Board has identified particular qualifications, attributes, skills and experience that are important to be represented on the Board as a whole. The Nominating and Governance Committee is charged with the responsibility of tracking the Directors’ professional experience and skill sets with a board inventory matrix (the “Skills Matrix”). The Skills Matrix lists each Director and his or her professional experience and skill sets in categories considered by the Board and the Committee to be advantageous to the regulated utility business, as well as for a company of Unitil’s size and complexity. The Committee uses this information to assess overall Board composition and to identify existing and potential gaps in the skill sets of Directors. This information is also used for recruiting purposes when there is a vacancy, or an expected vacancy, on the Board. The Skills Matrix has proven to be a valuable tool in this assessment exercise. The Board strives to represent a meaningful cross-section of business and industry experience, education, and specialized skill sets with a group of diverse individuals who add the element of quality to the Company’s corporate governance framework, and who fairly and without compromise execute their fiduciary duty to serve the best interests of Unitil’s shareholders and all of the Company’s stakeholders.

The Skills Matrix Summary outlines certain essential key qualifications, attributes, skills and experience that the Board believes should be represented on the Board as a whole for optimal oversight of the Company’s business and the effective exercise of its fiduciary duty to shareholders.   Directors standing for reelection are also evaluated by the Committee for

recommendation to the Board using a set procedure based on the expectations of Board members, which is provided to all members of the Board annually. The evaluation includes contribution to the Board and committees served upon; unique skills, expertise and attributes; attendance and preparedness; and willingness to continue serving. Overall continuity and chemistry of the Board are also considerations, as well as factors relating to the composition of the Board, such as size and structure, and also the diversity of backgrounds, perspectives, experience and skills among its members. Lengthy tenure on the Board is considered to be a uniquely valuable qualification in the highly regulated utility industry.

BOARD DIVERSITY

Although the Board does not have a formal diversity policy, it does seek to maintain optimum Board heterogeneity through an appropriate balance of diversity of backgrounds, perspectives, tenure, professional experience and skills among its members. The Board believes that a variety of points of view and experiences contributes to a more effective decision-making process, and considers diversity of gender, age, competencies, and professional experience in the evaluation of all candidates for Board membership. The Board also considers how the experience and skill set of each Director nominee complements those of existing Directors and fellow Director nominees to create a balanced Board with diverse viewpoints and deep expertise.

Skills Matrix Summary Utility Operations CEO/Senior Leadership Experience High Level Financial Aptitude Utility Regulation Regional Knowledge/Expertise Public Policy

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TRANSACTIONS WITH RELATED PERSONS

The Audit Committee is responsible for reviewing and approving, as appropriate, all Related Person Transactions (as defined below), in accordance with its charter (the “Audit Committee Charter”). As a result, the Audit Committee has adopted procedures for such review and approval and included such procedures in the Company’s Corporate Governance Guidelines. The Company had no Related Person Transactions in 2017, and there are no Related Person Transactions currently proposed for 2018. A “Related Person Transaction” means any transaction for which disclosure is required under the terms of Item 404(a) of SEC Regulation S-K involving the Company and any Related Person. A “Related Person” is defined in Item 404(a) of SEC Regulation S-K.

Transactions between the Company or one or more of its subsidiaries and one or more Related Persons may present risks or conflicts of interest or the appearance of conflicts of interest. The Company’s Code of Ethics generally requires all employees, officers and Directors to avoid engagement in activities or relationships that conflict, or would be perceived to conflict, with the Company’s interests or adversely affect its reputation. It is understood, however, that certain relationships or transactions may arise that would be deemed acceptable and appropriate upon full disclosure of the transaction, following review and approval to ensure there is a legitimate business reason for the transaction and that the terms of the transaction are no less favorable to the Company than could be obtained from an unrelated person.

In connection with the review and approval or ratification, if appropriate, of any Related Person Transaction, the Audit Committee will consider whether the transaction will compromise the Company’s professional standards included in its Code of Ethics. In the case of any Related Person Transaction involving an outside Director or nominee for Director, the Audit Committee will also consider whether the transaction will compromise the Director’s status as an independent Director as prescribed in the NYSE Listed Company

RELATED PERSON TRANSACTIONS Review & Approval Procedure Requirements all Related Person Transactions and all material terms of the transactions shall be communicated to the Audit Committee for evaluation, including, but not limited to, the approximate dollar value of the amount involved in the transaction, and all material facts as to the Related Person’s direct or indirect interest in, or relationship to, the Related Person Transaction each Related Person Transaction, and any material amendment or modification to any Related Person Transaction, must be reviewed and approved or ratified by the Audit Committee RELATED PERSON TRANSACTIONS Basis for Audit Committee Evaluation of on Transactions information provided by members of the Board during the required annual affirmation of independence, at which the members of the Audit Committee will be present applicable responses on Directors’ and Officers’ Questionnaires submitted by Directors and officers and provided to the Audit Committee by the Corporate Secretary or Internal Auditor background information on nominees for Director provided by the Nominating and Governance Committee any other applicable information provided by any Director or officer of the Company

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Manual, Section 303A, Independent Directors. The procedures followed by the Audit Committee to evaluate transactions with Related Persons are also available in the Corporate Governance portion of the Investor Relations section of the Company’s website at www.unitil.com/investors.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

The subsection entitled Section 16(a) Beneficial Ownership Reporting Compliance within the Share Ownership section of this proxy statement is incorporated herein by reference.

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The Board has the following standing committees: Audit Committee; Compensation Committee; Executive Committee; and Nominating and Governance Committee. The tables below provide a summary of each committee with respect to membership and primary responsibilities.

Audit Committee

Committee Chair ◆

The Audit Committee is a separately-designated standing audit committee established in accordance with section 3(a)(58)(A) of the Exchange Act. Each member of the Audit Committee is financially literate, knowledgeable and qualified to review financial statements. The Audit Committee operates under a written charter, which it reviews annually, and adopts amendments, if necessary, to reflect changes governing financial reporting and accounting requirements or its responsibilities. The Audit Committee Report, which appears in the section entitled Audit Matters, more fully describes the activities and responsibilities of the Committee.

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Compensation Committee

Committee Chair ◆

 NOTE:

The Compensation Committee operates under a written charter, which it reviews annually and, as appropriate, amends to reflect changes in its responsibilities. The specific activities and responsibilities of the Compensation Committee are described in greater detail in the section entitled Compensation Committee Operations.

Executive Committee

Committee Chair ◆

 NOTE:

The Executive Committee operates under a written charter, which it reviews annually and, as appropriate, amends to reflect changes in its responsibilities.

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Nominating & Governance Committee

Committee Chair ◆

 NOTE:

The Nominating and Governance Committee operates under a written charter, which it reviews annually and, as appropriate, amends to reflect changes in its responsibilities.

All Committees

The existence and activities of all committees of the Board do not alter the traditional roles and responsibilities of the Company’s management. All committees may delegate authority to individuals or subcommittees when they deem appropriate, subject to applicable laws, rules or regulations. However, in delegating authority, a committee shall not be absolved from the responsibilities designated under the terms of its respective charter. All committees shall undertake any other action or exercise such other powers, authority, duties and responsibilities as necessary or appropriate to the discharge of the duties and responsibilities set forth in their respective charters or the Company’s Bylaws, or otherwise required by the listing standards of the NYSE or other applicable laws, rules or regulations, or as shall otherwise be determined by or assigned by the Board.

The charters for each of the standing committees are available in the Corporate Governance portion of the Investor Relations section of the Company’s website at www.unitil.com/investors, or in print to any shareholder or other interested party, free of charge upon request to the Office of the Secretary, Unitil Corporation, 6 Liberty Lane West, Hampton, NH 03842-1720; or to InvestorRelations@unitil.com; or by calling toll free 800-999-6501.

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AUDIT COMMITTEE REPORT

The following report is submitted by the Audit Committee of Unitil Corporation with respect to the Company’s audited financial statements for the fiscal year ended December 31, 2017.

In discharging its oversight responsibility regarding the audit process, the Audit Committee has discussed with Deloitte & Touche LLP (“Deloitte”), the Company’s independent registered public accounting firm for the fiscal year ended December 31, 2017, the matters required to be discussed by Auditing Standard No. 1301. In addition, the Committee has received the written disclosures and the letter from Deloitte required by applicable requirements of the Public Company Accounting Oversight Board regarding Deloitte’s communications with the Committee concerning independence and has discussed with Deloitte the firm’s independence with respect to the Company.

During 2017, the Audit Committee members received the Company’s quarterly financial information for review and comment prior to the filing of each of the Company’s Forms 10-Q with the SEC. In fulfilling its responsibilities relating to the financial statements, the Committee also reviewed and discussed the Company’s significant accounting policies and the audited financial statements of the Company for the fiscal year ended December 31, 2017 with management and Deloitte. Based on the review and discussions with management and Deloitte, the Committee recommended to the Board that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017, for filing with the SEC.

Audit Committee Members

Dr. Robert V. Antonucci, Edward F. Godfrey, Michael B. Green (chairman), and David A. Whiteley

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PRINCIPAL ACCOUNTANT FEES & SERVICES

The following table presents fees for professional services rendered by Deloitte, the Company’s independent registered public accounting firm, for the fiscal years ended December 31, 2017 and 2016.

Audit Fees

In 2017 and 2016, this category includes fees incurred for professional services rendered by Deloitte for reviewing the quarterly financial statements included in the Company’s Quarterly Reports on Form 10-Q, auditing the Company’s annual financial statements included in the Company’s Annual Report on Form 10-K, and auditing the Company’s internal control over financial reporting. In addition, in 2017, this category also includes fees incurred of approximately $170,000 for professional services rendered by Deloitte related to the Company’s implementation of a new customer information system in the third quarter of 2017.

Audit-Related Fees

In 2017, this category includes fees incurred of approximately $80,000 for professional services rendered by Deloitte in connection with registration statements filed by the Company with the Securities and Exchange Commission. In 2016, Deloitte did not perform any audit-related services.

Tax Fees

In 2017 and 2016, Deloitte did not perform any tax services.

All Other Fees

In 2017 and 2016, Deloitte did not perform any services that are not included in the above categories.

AUDIT COMMITTEE PRE-APPROVAL POLICY

The Audit Committee has adopted a formal policy concerning approval of audit and non-audit services to be provided by the independent registered public accounting firm engaged to audit the Company’s consolidated financial statements. The policy requires that all services to be provided by the independent registered public accounting firm, including audit services and permitted audit-related and non-audit services, must be pre-approved by the Committee. The Committee pre-approved all audit, audit-related, tax and all other services provided by Deloitte during fiscal 2017 and 2016.

Fiscal 2017 Fiscal 2016 Audit Fees $887,500 $692,000 Audit-Related Fees $80,000 $0 Tax Fees $0 $0 All Other Fees $0 $0 Total Fees $967,500 $692,000

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COMPENSATION COMMITTEE OPERATIONS

The Compensation Committee is appointed annually by the Board and is responsible for oversight of the executive compensation program. The Committee has overall authority to establish goals and objectives and to interpret the terms of the Company’s compensation policies, including base salary, incentive compensation, equity compensation, sales commissions, and benefits programs. The Committee discharges its oversight responsibilities by carrying out the specific functions outlined in its charter (the “Compensation Committee Charter”). See the section entitled Compensation—Compensation of Named Executive Officers—Compensation of Directors for information on the Nominating and Governance Committee’s work regarding Directors’ compensation.

The Committee has the authority to delegate some of its responsibilities to individuals or subcommittees of the Committee’s choice, subject to applicable laws, rules or regulations. However, such delegation does not, and will not, absolve the Committee from the responsibilities that it bears under the terms of the Compensation Committee Charter.

The Committee has the authority to invite Executive Officers, members of management or other guests to attend its meetings, to perform research, or to provide relevant information or recommendations. At the Committee’s request, Mr. Schoenberger and Mr. Collin served the Committee in 2017 in a consultative capacity, providing data and analytical support, as well as management perspective and recommendations relative to employee compensation and benefits, including executive compensation. Mr. Collin was excluded from deliberations and decisions regarding Executive Officer compensation. Mr. Schoenberger participated in the discussions and decisions regarding salaries and incentive compensation for the Executive Officers of the Company reporting directly to him. Mr. Schoenberger was excluded from deliberations and decisions regarding his own salary and incentive compensation.

The Committee also has the authority to retain or obtain the advice of outside counsel, compensation consultants or other advisors to advise the Committee as it deems appropriate or necessary in its sole discretion. The Committee is directly responsible for the appointment, retention terms (including compensation), and oversight of the work of any adviser it retains. Prior to retaining or obtaining advice from an adviser, the Committee will consider factors relevant to the adviser’s independence from management to the extent required by the NYSE listing standards.

Since 2009, the Committee has periodically engaged a compensation consultant, Willis Towers Watson (“Willis Towers”), to provide compensation study data, including data from selected peer companies and compensation marketplace survey analysis, as well as to provide various recommendations based on study findings and industry trends for the Committee’s consideration. Willis Towers is engaged by and reports directly to the Compensation Committee. Willis Towers receives compensation only for services related to executive compensation, employee benefits and general compensation issues, and neither it nor any affiliated company provides any other services to the Company.

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In 2014, the Committee engaged Willis Towers to prepare a comprehensive compensation analysis (the “2014 Compensation Analysis”), which included an in depth study of chief executive officer compensation, salary survey data for comparable industry executives and middle management, and benefits. The Compensation Committee used the information in the 2014 Compensation Analysis for decisions concerning executive compensation for the 2015 compensation year.

In 2015, the Committee again engaged Willis Towers to assess the competitiveness of the compensation of the Named Executive Officers (the “2015 Assessment”) using the 2014 Compensation Analysis as a foundation with updated information from published compensation surveys, including base salary, total cash compensation (base plus annual incentives), and total direct compensation (base plus annual incentives plus long-term incentives). The Committee used the information from the 2015 Assessment as a reference point, or benchmark, upon which to base its compensation decisions for Named Executive Officers, including the CEO, for the 2016 compensation year.

The 2014 Compensation Analysis and the 2015 Assessment as well as the Committee’s use of the 2014 Compensation Analysis and 2015 Assessment are described in greater detail in the section entitled Compensation—Compensation Discussion and Analysis.

In 2016 and 2017, in order to prudently manage outside consulting expenses, the Committee decided to forego special consulting work related to executive compensation, and to instead utilize the existing compensation programs which were previously found to be reasonable and competitive in design and operation. The Committee will consider to next engage Willis Towers in a review of executive compensation during 2018.

COMPENSATION COMMITTEE INTERLOCKS & INSIDER PARTICIPATION

The current members of the Compensation Committee are not current or former officers or employees of the Company. No member of the Committee has any relationship requiring disclosure under Item 404 of Regulation S-K, Transactions with Related Persons. In addition, no Executive Officer of the Company serves on the board of directors or compensation committee of another company where an executive officer of the other company also serves on the Board or Compensation Committee.

RISK AND BROAD-BASED COMPENSATION PROGRAMS

After review and evaluation of the Company’s compensation policies and practices, including the annual incentive award performance metrics, variable and non-variable pay mix, and limited non-performance payouts, the Compensation Committee determined, and management agreed, that the risks arising from the Company’s compensation policies and practices are not likely to have a material adverse effect on the Company because (a) the Company’s compensation program is designed to be balanced and not motivate imprudent or excessive risk-taking by Executive Officers or other employees, (b) the Company does not use incentives that encourage short-term, high-risk strategies at the expense of long-term performance and value, (c) the Compensation Committee has significant discretion in its determination of incentive

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compensation awards, (d) the Compensation Committee considers distinct quantitative factors with regard to incentive compensation, (e) the Compensation Committee considers qualitative factors, such as the difficulty of achieving goals and challenges faced during the year, to encourage employees and Executive Officers to consider and balance all aspects of the Company’s Strategic Plan, both short- and long-term, and (f) the variable and non-variable pay mix is proportionally weighted for Executive Officers and all employees.

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COMPENSATION DISCUSSION AND ANALYSIS

Introduction

In 2017, the Company continued to show strong operating and financial results, which have translated into greater returns for shareholders. Selected highlights of 2017 are outlined below.

Unitil made strong progress in 2017, with record earnings continuing a string of improving performance and growth.   Net income grew to $29.0 million in 2017, an increase of 7.0% compared to 2016. Earnings per share grew to $2.06 per share, an increase of 6.2% compared to 2016, and average return on equity climbed to 9.7%.   The Company’s positive financial results are largely driven by continued natural gas customer and sales growth, higher investment in gas and electric utility rate base, a successful regulatory agenda, and the strengthening economy.

In 2017, the Company realized record financial results, met strategic and operational goals,

and provided customers with exceptional service quality, outstanding gas safety, as well as continued strong performance in electric reliability. Distribution cost per customer was among the lowest for both gas and electric customers as compared to peer utility companies in the northeast.

For the five-year period ended December 31, 2017, Unitil’s total shareholder return was 113%, a return that outperformed the Company’s peer group at 81% over the same period.

Unitil’s annualized common stock dividend of $1.44 per share in 2017 provided a dividend yield of approximately 3.2%, based on the closing stock price of $45.62 per share on December 29, 2017. Unitil has paid an annual common stock dividend every year since trading on the open market began in 1984. In addition, on January 30, 2018, the Board of Directors voted to increase the annualized dividend to $1.46 per share.

Comparative Five-Year Cumulative Total Returns (1) (1) Unitil data provided by the Edison Electric Institute. S&P 500 S&P 500 Utility Index data provided by standard & Poor’s. The chart above shows how a $100 investment in the Company’s Common Stock on December 31, 2012 would have grown to $213 on December 31, 2017, with dividends reinvested quarterly. The chart also compares the total shareholder return on the Company’s common stock to the same investment in the S&P 500 Index and the Company’s peer group, defined as the S&P Utility Index, over the same period, with dividends reinvested quarterly.

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Compensation Philosophy and Administration

The Compensation Committee is responsible for oversight of the executive compensation program. The Committee, the Board and the Company recognize the value and importance of sound principles for the development and administration of competitive compensation and benefit programs. The Company believes that its executive compensation program (i) is instrumental in the achievement of its short-term and long-term strategic and business objectives, (ii) provides appropriate rewards for the fulfillment of strong operational and financial performance and (iii) provides appropriate rewards for practicing the Company’s core values and principles, which creates lasting value for shareholders and other stakeholders.

The Compensation Committee utilizes a set of guiding principles for setting executive compensation, which are discussed below. Additional information concerning the processes and operational procedures followed by the Committee can be found in the section entitled Compensation—Compensation Committee Operations.

Compensation Policy & Process

The principal objective of Unitil’s executive compensation program is to attract, motivate, retain and reward highly qualified employees who are committed to the achievement of solid financial performance, outstanding service to customers, and excellence in the management of the Company’s assets. It is the Company’s belief that a strong sense of teamwork and shared responsibility are vital components in the achievement of strong performance. The Company’s incentive compensation reflects and supports this philosophy with an appropriate balance of both financial and operational goals that apply to the entire management team. See the section entitled Compensation—Compensation Discussion and Analysis—Elements of Compensation for a discussion of the specific goals set, and results achieved, for 2017. The Company also believes that retention of talented and dedicated key executives will help ensure continued focus on the achievement of long-term growth in shareholder value and provide significant benefit to all of the Company’s stakeholders, including shareholders, customers and employees.

The guiding principles utilized by the Compensation Committee in the design and implementation of the Company’s executive compensation program are outlined below.

EXECUTIVE COMPENSATION - GUIDING PRINCIPLES Annual compensation (currently defined as base salary, cash incentive and equity compensation for the Company’s employees, including the Executive Officers) should generally target the national market median, which is defined as the middle, or the 50th percentile, of the compensation marketplace. The compensation methodology for determining base pay increases should be the same for all executive positions including the CEO and other Named Executive Officers. The compensation methodology should include a consistent formula for determining each component of annual compensation based on both objective and verifiable market data and on attainment of selected performance measures from the Company’s approved strategic plan (the “Strategic Plan”).

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To aid in its decision-making process, in both 2014 and 2015, the Compensation Committee engaged compensation consulting firm Willis Towers to prepare an in-depth analysis of executive compensation.

2014: 2015 Compensation Decisions

In 2014, Willis Towers provided the Committee a comprehensive compensation analysis (the “2014 Compensation Analysis”) which included chief executive officer compensation, salary survey data for comparable industry executives and middle management, and benefits.

The 2014 Compensation Analysis scope included an overall analysis of the Company’s compensation as it relates to and supports the Company’s business strategy, and detailed information on executive compensation, as well as a review of the research methodology and process, key findings with regard to base salary and incentive compensation, program assessment, and several recommendations for changes.   The Compensation Committee used the information in the 2014 Compensation Analysis (a) to gain
a general understanding of compensation practices, (b) as a reference point, or benchmark, upon which to base its compensation decisions and (c) to analyze each Executive Officer’s, including the CEO’s, compensation for 2015.

Willis Towers used two sources of data in the 2014 Compensation Analysis for assessment of the Company’s position in the compensation marketplace:

Compensation Data from Published Compensation Surveys

Compensation data from published compensation surveys focused on comparably sized organizations in the utility sector and general industry sector (for “cross industry” positions) ¹. Published survey data were size-adjusted based on revenue, employee regression and/or scope parameters. Because the surveys are confidential, the specific data selected by Willis Towers did not indicate survey participants by company name.

2014 COMPENSATION ANALYSIS Nature & Scope Detailed review of compensation for executives (including Named Executive Officers) – including defining the competitive marketplace and selected peer group, and assessing the competitiveness and mix of total compensation, appropriateness of cash and equity incentive programs, and competitiveness of key benefit programs. Competitive assessment of non-union cash compensation for 92 positions covering 145 incumbents in the general employee population – including cash compensation, appropriateness of salary structure, and analysis of incentive targets. Review of broad-based benefit program design to ensure competitiveness of total compensation.

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Compensation Data from Proxy Filings

Compensation data was extracted from publicly available proxy filings for a selected group of 16 publicly traded utility companies with annual revenues between $81 million and $1.6 billion (the “2014 Peer Group”) ². The Compensation Committee used this data to analyze only the CEO’s compensation, with the objective of ensuring that the CEO’s total compensation was reasonable, competitive and consistent with pay practices at peer companies.

For the proxy-based market analysis, Willis Towers prepared a benchmarking assessment using position-specific market data to compare Unitil’s current compensation levels for the CEO with compensation levels for comparable positions in the 2014 Peer Group. Market data for total direct compensation elements were extracted for the 25^th percentile, the median (50^th percentile), and the 75^th percentile.

Due to the fact that Unitil’s size (based on fiscal year-end 2013 revenues and number of employees) was approximately equal to the 25^th percentile of the 2014 Peer Group companies, the Compensation Committee targeted the 25^th percentile within this data set.

For the published survey-based analysis, Willis Towers used benchmark matches for all positions (including the CEO) in its assessment. For all published survey-based data, market values reflected the size/scope of Unitil’s revenues and employee count through use of regression analysis (or tabular groupings where regression data were not available). Because the published survey databases cover a vast number of benchmark positions in the utility industry sector and general industry sector, Willis Towers advised the Compensation Committee that the median (50^th percentile) of the published survey-based data set approximated the 25^th percentile of the smaller proxy-based data set. The Committee determined that the median (50^th percentile) of the marketplace when using information from the published survey-based data set was an appropriate target.

The Compensation Committee used the information in the 2014 Compensation Analysis as a reference point, or benchmark, upon which to base its compensation decisions for the 2015 compensation year. The Committee also considered and discussed various recommendations from Willis Towers based on study findings and industry trends.

DIRECT COMPENSATION ELEMENTS Market Data Base salary Target annual incentive compensation Actual total cash compensation (base salary plus most recent actual annual incentive payment) Long-term incentive expected value granted during the most recent year Actual total direct compensation (actual total cash plus the expected value of long-term incentives)

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2015: 2016 Compensation Decisions

In 2015, at the request of the Compensation Committee, Willis Towers prepared an assessment of the competitiveness of the compensation of the Named Executive Officers (the “2015 Assessment”) using the 2014 Compensation Analysis as a foundation with updated information from published compensation surveys, including base salary, total cash compensation (base salary plus annual incentives), and total direct compensation (base salary plus annual incentives plus long-term incentives). The Committee assessed the competitiveness of each Named Executive Officer’s compensation in the context of market practices and Unitil’s compensation philosophy, which is to target the national market median, or 50^th percentile, of the compensation marketplace in the published compensation surveys. The Committee also used information from 2015 proxy statements of the Company’s utility company peer group, at the 25^th percentile target, as a secondary source to assess CEO compensation competitiveness.

Compensation Data from Published Compensation Surveys

Compensation data from published compensation surveys focused on comparably sized organizations in the utility sector and general industry sector (for “cross industry” positions). Published survey data were size-adjusted based on revenue, employee regression and/or scope parameters. Because the surveys are confidential, the specific data selected by Willis Towers did not indicate survey participants by company name.

Compensation Data from Proxy Filings

Chief executive officer compensation data was obtained from publicly available proxy filings for a selected group of 15 publicly traded utility companies ³ (the “2015 Peer Group”) with annual revenues between $86 million and $1.6 billion.

The Committee used the information from the 2015 Assessment as a reference point, or benchmark, upon which to base its compensation decisions for Named Executive Officers, including the CEO, for the 2016 and 2017 compensation years. The Committee also used information from the 2015 proxy statements of the Company’s utility company peer group, at the 25^th percentile target, as a secondary source to assess CEO compensation competitiveness.

2016: 2017 Compensation Decisions

In 2016 and 2017, in order to prudently manage outside consulting expenses, the Committee decided to forego special consulting work related to executive pay, and to instead utilize the information contained in the 2015 Assessment, as well as existing compensation programs and policies previously found to be reasonable and competitive in design and operation, to evaluate executive compensation for 2017 and 2018 compensation years. The Committee will consider to next engage Willis Towers for a comprehensive review of executive compensation during 2018.

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Salary Administration

The Company’s Salary Administration Policy has three objectives:

To provide a compensation program equal to or better than the median of compensation programs provided by geographically comparable businesses;

To manage base salaries in a manner that recognizes and appropriately rewards performance within prescribed budgetary limits; and

To provide base salary opportunities that are competitive with external pay practices for substantially comparable work.

The Salary Administration Policy includes three important components:

Job Description Every employee of the Company has a job description that represents his or her position within the Company. All job descriptions are written using a requisite format describing the position purpose, principal accountabilities, competencies, challenges, decision making authority, qualifications, and scope and quantitative dimensions.   Job Evaluation The Company uses a variety of published salary sources and survey data to assist in the review and evaluation of non-executive, non-union job descriptions in order to confirm reasonable and appropriate base compensation for each position. See also the section entitled Compensation—Base Salary below. This practice provides for internal equity between comparable positions as well as external comparability with other companies. The end result of the job evaluation process is that each job is assigned a pay grade that translates into a salary range. Executive level positions (including the Named Executive Officers) are reviewed and evaluated independently by Willis Towers.

Market Analysis & Salary Range

Each year the Company participates in numerous salary market studies to ensure that the competitiveness of base salaries is maintained. The Company adjusts the salary ranges each year based upon the results of these surveys to ensure that the Company maintains its salary ranges at the median market level. Historically, the salary ranges are adjusted by approximately 2% annually based on market survey data. The midpoint of the base salary range is set at the median level of the broad-based published compensation survey group when compared to similar positions at comparable companies. The minimum in the salary range is determined by multiplying the midpoint by 80%, and the maximum is determined by multiplying the midpoint by 120%. In general, the salary range minimum is commonly the lowest amount the Company will pay a new employee in the job, with the aim of employees reaching the midpoint of the range within five years. The midpoint is where the Company strives to pay fully trained, fully competent employees. The midpoint to maximum range is where high-performing employees and long-term employees tend to be paid. Exceptions are occasionally made based on experience, skills, education, and other factors.

Base Salary

The Company sets base salary ranges for every job grade and position based upon salary survey data provided by Willis Towers and in accordance with the Salary Administration Policy described above. In relation to each Named Executive Officer, base salary is set within the salary range based upon individual experience, skills, and education, as well as performance relative to individual annual goals. This process is used for both executive and non-executive positions.

Job Description Job Evaluation Market Analysis Salary Range

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Incentive Compensation – Cash Incentive

The Company sets annual target cash incentive awards equal to the median of the broad-based published compensation survey group for the Executive Officers’ target cash incentive awards at other comparable companies based on data provided by Willis Towers. The Committee also used information from the proxy statements of the Company’s peer group, at the 25^th percentile target, as a secondary source to set the CEO’s annual target cash incentive award. The Company has developed a “balanced score card” approach to setting goals for the annual incentive awards, which includes certain goals from the Strategic Plan that represent success in financial results, electric reliability, gas safety, customer service and distribution cost per customer. The Compensation Committee approves the quantitative goals, also referred to as performance metrics, for these awards annually. See the section entitled Compensation—Compensation Discussion and Analysis—Elements of Compensation for a discussion of the balanced score card.

Incentive Compensation – Equity Compensation

The Company grants shares of restricted stock to executive participants in the Stock Plan annually. The size of the annual restricted stock award is based upon the Company’s performance, and the target award is based on market data for the median of the broad-based published compensation survey group size grant at peer group and other comparable companies, as calculated using data provided by Willis Towers. The Committee also used information from the proxy statements of the Company’s peer group, at the 25^th percentile target, as a secondary source to set the CEO’s annual restricted stock award. The shares of restricted stock vest over a period of four years, and the executive must request and receive approval from either the CEO or the Company’s Chief Financial Officer (“CFO”) to sell fully vested shares.

Performance-Related Incentive Compensation

In addition to individual performance, the Company’s performance is a critical component in the determination of how each individual executive is paid relative to the market median of the broad-based published compensation survey group, as described above. Accordingly, approximately 39% (for Mr. Schoenberger) and 27% (average for the other Named Executive Officers) of the 2017 annual compensation was incentive compensation directly related to the Company’s performance.

CEO Pay Ratio

Summary

As required by the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Securities and Exchange Commission adopted a rule requiring annual disclosure of the ratio of the median employee’s annual total compensation to the total annual compensation of the principal executive officer. The Company’s principal executive officer is Mr. Schoenberger (the “CEO”).

The Company believes the compensation program and salary administration policy should be consistent and internally equitable to motivate all employees to perform in ways that enhance shareholder value. The Company believes its compensation philosophy and processes yield an equitable result for all employees.

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Methodology

To reasonably identify the median employee, the Company prepared a list of all employees (excluding the CEO) as of December 31, 2017. The list included part-time employees. As of December 31, 2017, the Company employed 498 persons of which 342 were non-union employees and 156 were union employees covered by a collective bargaining agreement.

Next, the Company extracted the taxable wages number reported in Box 1 of the 2017 Form W-2 from the Company’s payroll records for each employee, excluding the CEO. The Company did not annualize wages and salaries for those employees that were not employed for the full year of 2017. The employee population was then divided into two groups; union and non-union. The non-union group was then further divided by pay grade, of which there are 16. The Company then estimated the median salary for the union group, as well as for each pay grade within the non-union group, resulting in 17 separate median values. The Company then identified the median employee by determining the median of the 17 median values. Once identified, the Company estimated the median employee’s total annual compensation in the same manner as the “Total Compensation” shown for the CEO in the Summary Compensation Table in the section entitled Compensation—Compensation of Named Executive Officers.

Results

The table below shows the information used for the calculation of the ratio of the estimated annual total compensation of the median employee identified using the methodology described above to the annual total compensation of the CEO of the Company.

NOTES :

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Shareholder Advisory Vote on Executive Compensation and Frequency of Advisory Vote

As required by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), every six years the Company must provide the opportunity for shareholders to vote, on an advisory basis, on the frequency (commonly known as a “say-on-frequency” proposal) that the say-on-pay advisory vote will be presented to shareholders. At the 2017 annual meeting of shareholders, shareholders voted (on an advisory basis) to hold a say-on-pay advisory vote annually. In light of this voting result, the Board decided to hold a say-on-pay advisory vote annually until the next required vote on the frequency of shareholder votes on the compensation of executives.

At the 2017 annual meeting of shareholders, the Company presented the required advisory (non-binding) shareholder vote on the compensation of the Company’s Named Executive Officers (commonly known as a “say-on-pay” proposal). As reported in the Company’s Form 8-K, filed with the SEC on May 1, 2017, 87% of shareholders approved by advisory vote the compensation of the Company’s Named Executive Officers. The Compensation Committee considered the results of the advisory vote by shareholders on the say-on-pay proposal presented to shareholders at the 2017 annual meeting of shareholders in its decision to make no direct changes to the Company’s executive compensation program in 2017 as a result of the vote.

The Company’s 2018 say-on-pay proposal is included in this proxy statement as Proposal 3: Approval, on an Advisory Basis, of the Compensation of the Company’s Named Executive Officers.

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ELEMENTS OF COMPENSATION

Base Salary

Every employee is paid a base salary. The purpose of base salary is to reward employees for the expertise and value they bring to their jobs. Base salary is determined according to the Company’s salary policy, which assigns each position a grade and a corresponding salary range. The Company sets salary ranges for every position based upon comparative salary data provided by Willis Towers. The midpoint of the salary range is set at the median level of the broad-based published compensation survey group when compared to similar positions at other comparable companies. The minimum parameter in the salary range is determined by multiplying the midpoint by 80%, and the maximum parameter is determined by multiplying the midpoint by 120%. The salary range is then used to manage each employee’s salary, and an employee’s salary within the range is based on merit. For each employee (including Named Executive Officers), base salary is set within the salary range based upon individual performance relative to individual annual goals. The elements of individual performance differ depending on the individual position, but include: quality of work; successful completion of established goals; ability to initiate creative solutions; adaptability to change; and impact on performance of the Company. The salaries of all employees (including the Named Executive Officers) are reviewed annually, as well as at the time of a promotion or change in responsibilities.

Each position in the Company (including all Executive Officer positions) has a job description that outlines the accountabilities and competencies required. Merit increases are considered at the end of the year based on the evaluation of each person’s performance as related to each accountability listed in the individual job description, as well as the achievement of individual goals established at the beginning of the year. Merit increases are generally effective as of January 1 of each year. Merit increases also are one of the methods used to reach one of the Company’s competitive compensation guiding principles, which is to ensure that employees are paid at or near the market median of the broad-based published compensation survey group. Merit increases may also be adjusted by the Compensation Committee to reflect the market value of a job when compared to similar positions at other companies within the Company’s peer group, as recommended by Willis Towers.

Named Executive Officer 2017 Base Salary Increase Mr. Schoenberger 5.0% Mr. Collin 5.0% Mr. Meissner 5.0% Mr. Black 5.0% Mr. Brock 3.8%

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Incentive Compensation

Management Incentive Plan

The Unitil Corporation Management Incentive Plan (the “Management Incentive Plan”) provides annual cash incentive payments based upon the attainment of specified goals selected from the Strategic Plan. The Compensation Committee selects participants in the plan and establishes their individual target awards. All executives (including the Named Executive Officers) are participants in the Management Incentive Plan. The purpose of the Management Incentive Plan, which is consistent with the Company’s principal compensation objective, is to provide executives with significant incentives related to performance, thereby providing motivation to maximize efforts on behalf of all the Company’s stakeholders. The Management Incentive Plan is further intended to provide executives with competitive target levels of total compensation when considered with base salaries.

For the annual incentive awards, annual quantitative performance goals are established by the Compensation Committee. These goals, which relate to key performance metrics selected from the Strategic Plan, are the same for all employees (including Executive Officers), with the exception of Usource employees, to ensure that employees are focused on common bottom-line business, customer service, and operational results. (Usource employees are rewarded using performance metrics that are directly related to the growth and success of Usource, also as established by the Committee.) These goals are discussed below in the subsection entitled Incentive Compensation Performance Metrics and Goals. Under the Management Incentive Plan, Executive Officers receive a cash award if the quantitative goals that are set by the Committee are met. Each Executive Officer’s Management Incentive Plan target award is established as a percentage of base salary based on the market median of the broad-based published compensation survey group for his or her position when compared to other comparable companies, calculated using data provided by Willis Towers. The Committee also used information from the proxy statements of the Company’s peer group, at the 25^th percentile target, as a secondary source to set the CEO’s Management Incentive Plan target award. The table below shows the Management Incentive Plan target awards for 2017 as a percentage of base salary for the Named Executive Officers.

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Second Amended and Restated 2003 Stock Plan

The Unitil Corporation Second Amended and Restated 2003 Stock Plan (as amended, the “Stock Plan”) was initially approved by shareholders at the 2003 annual meeting of shareholders, amended and restated on March 24, 2011, and again amended and restated, effective April 19, 2012. Participation in the Stock Plan is currently limited to Directors, Executive Officers and other employees and consultants selected by the Compensation Committee. Restricted Stock and Restricted Stock Units (“RSUs”) may be issued to participants in the Stock Plan.

Restricted Stock

Generally, in January or February of each year, the Company grants annual awards, in the form of restricted stock, to current Executive Officers and employee participants in the Stock Plan based upon the attainment of the same set of specified goals as those selected for the annual cash incentive awards discussed above. As with the annual cash incentive awards, target awards are established for each participant that generally vary based upon the job grade level of such participant’s position in the Company in accordance with survey data provided by Willis Towers. The objectives of the Stock Plan, which tie back to the principal compensation objective, are to optimize profitability and growth through incentives that link the personal interests of participants to those of shareholders, to provide participants with an incentive for excellence in individual performance, to promote teamwork among participants, and to encourage stock ownership in the Company. Further, equity-based compensation ensures that Executive Officers have a continuing stake in the Company’s long-term success.

Named Executive Officer Target Award (% of Base Salary) Mr. Schoenberger 65% Mr. Collin 45% Mr. Meissner 45% Mr. Black 35% Mr. Brock 30%

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The value of each possible award extends from a minimum of 50% of the target restricted stock award amount to a maximum of 150% of the target award amount. This award is then reduced for anticipated income taxes and Medicare taxes, with Stock Plan participants receiving the shares net of such taxes, subject to the vesting schedule. As the shares vest, they become taxable income to the participant, and the taxes, previously accounted for, are credited back to participants. This procedure reduces both the dilutive effect of the Stock Plan by granting fewer shares than would otherwise be granted, and the volatility of the Company’s stock in the market by eliminating stock sales that would otherwise be completed to pay personal income taxes.

		The net restricted stock award provides a market competitive award while minimizing both dilution and volatility. In addition, the Committee may exercise discretion to vary the size of the restricted stock award, but chose not to do so for the restricted stock awards for 2017 performance.

Incentive Compensation Performance Metrics and Goals

The Company has two compensation plans in which the Named Executive Officers participate where performance metrics and goals are integrally and directly linked to the compensation awarded—the Management Incentive Plan and the Stock Plan.

Named Executive Officer Stock Plan Target Award Mr. Schoenberger $610,195 Mr. Collin $139,655 Mr. Meissner $139,655 Mr. Black $77,808 Mr. Brock $31,836 COMPENSATION COMMITTEE PROCEDURE: Annual Grant of Restricted Stock Tax Adjustment Calculation 1: Set the dollar amount of the stock award - the value of the target restricted stock award shall be equal to the value of the market median award of the broad-based published compensation survey group 2: Subtract the federal and Medicare tax impacts of the award to get the net award value 3: Divide the net award value by the current stock price to calculate a net award in shares

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Performance metrics and goals are recommended by the Company annually in the Strategic Plan. The Strategic Plan includes targets for each performance metric, and is reviewed and approved by the Board each year. In connection with the responsibilities outlined in the Compensation Committee Charter, key performance metrics and goals are then selected by the Compensation Committee each year, and the Committee may also consider recommendations from Willis Towers. The Committee selects the target performance goals from the Strategic Plan and determines a minimum and maximum performance level for each performance metric. Additional credit, or “weight,” is not provided for performance that achieves values greater than the maximum determined by the Committee, and no credit is given for performance that fails to achieve the minimum determined by the Committee.

The table on the following page shows the performance metrics and goals selected by the Compensation Committee for the 2017 annual incentive awards under the Company’s incentive plans, including the Management Incentive Plan and the Stock Plan, as well as the performance results calculated for 2017.

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2017 PERFORMANCE METRICS, GOALS AND RESULTS

For the “peer utility companies” referenced in the table above, actual performance is compared to a select group of utility companies that have service territory characteristics comparable to Unitil. This peer group is comprised of: Algonquin Power & Utilities Corp., Avangrid, Blackstone Gas Co., Emera, Inc., Eversource, Fortis, Inc., Gas Natural, Gaz Métro, National Grid, and NiSource, Inc.

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The Compensation Committee meets annually in the first fiscal quarter following certification of the fiscal year financial results by the Company’s independent registered public accounting firm to approve the payout of the annual cash incentive awards and to approve the annual grant of restricted stock awards under the Stock Plan. The Committee approved the 2018 annual cash incentive awards and the annual grant of restricted stock awards under the Stock Plan on January 29, 2018.

Incentive Compensation Formulas

Performance Factor

For purposes of the restricted stock awards under the Stock Plan, the Performance Factor was determined based upon the Weighted Performance Factor as shown below.

The Weighted Performance Factor, as shown in the formulas above, is the total actual quantitative performance calculation derived by multiplying each “weight” by the corresponding “factor” and adding the results. The “factor” is based upon where the actual performance results fall on the continuum of minimum—target—maximum, with “target” assigned a “factor” of 100%, “minimum” assigned a “factor” of 50%, and “maximum” assigned a “factor” of 150%.   As provided in the Compensation Committee Charter, the Committee has discretion to establish policies,

objectives, rules, and other procedures necessary for the effective operation of the Company’s compensation plans and programs. This discretion includes the authority to increase or decrease the annual cash incentive award payments under the Company’s incentive plans, including the Management Incentive

ANNUAL CASH INCENTIVE AWARD CALCULATION Plan Year Base Pay X Target Percent X Weighted Performance Factor = Incentive Cash Award Payment ANNUAL GRANT OF RETRICTED STOCK AWARD CALCULATION Target Restricted Stock Grant X Performance Factor = Actual Restricted Stock Grant WEIGHTED PERFORMANCE FACTOR PERFORMANCE FACTOR 50% to 69% 70% to 89% 90% to 109% 110% to 129% 130% to 150% 50% 75% 100% 125% 150%

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Plan and the restricted stock awards under the Stock Plan. The Committee also has the freedom to decide to pay no award when one would otherwise be paid. The Committee has in the past exercised its discretion to both increase and decrease certain awards when such calculation did not properly balance the interests of the employees and the shareholders. For awards for 2017 results, the Committee did not exercise any discretion to adjust the awards.

Other Benefits

Unitil Corporation Retirement Plan (the “Retirement Plan”)

The Retirement Plan is a traditional Defined Benefit Pension Plan covering certain employees of Unitil and its subsidiaries. It provides retirement income benefits based upon years of service, age at retirement and final five-year average salary. The Retirement Plan is closed to new participants, effective January 1, 2010. New employees participate in an enhanced 401(k) plan instead of the Retirement Plan. In addition, at the time of closure of the Retirement Plan, existing employee participants were offered a one-time opportunity to elect to remain an active participant in the Retirement Plan, or to accept a frozen Retirement Plan benefit and move to the enhanced 401(k) Plan.

Supplemental Executive Retirement Plan (“SERP”)

The purpose of the SERP is to provide enhanced retirement benefits to certain key executives selected by the Board in order to encourage continued service by these executives until retirement. Currently, Mr. Schoenberger, Mr. Collin, Mr. Meissner and Mr. Black have been named by the Board to participate in the SERP.

See also the Pension Benefits Table in the section entitled Compensation—Compensation of Named Executive Officers for the present value of the accumulated benefit for each Named Executive Officer.   Change of Control Agreements   The Company provides certain

executives with protection from job loss due to a change of control in the Company in the form of Change of Control Agreements (“Change of Control Agreements”). This protection is primarily provided so that the executives will make decisions and take actions that are in the best interest of shareholders and not unduly influenced by the fear of job loss. The Company maintains both two-year (executed in 2001 and later) and three-year (executed before 2001) Change of Control Agreements. Mr. Schoenberger, Mr. Collin, Mr. Black and Mr. Brock have three-year Change of Control Agreements, and Mr. Meissner has a two-year Change of Control Agreement in place.

SERP ENHANCEMENT OF RETIREMENT PLAN BENEFITS •all cash compensation towards the benefits formula is counted, thereby providing a bypass to the compensation limits imposed by the Internal Revenue Service (the “IRS”); •compensation received from the annual cash incentive awards in the benefits calculation is included; and•a final three-year average of salary and annual cash incentive compensation is used to determine the benefits from the SERP.

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All existing Change of Control Agreements are “double trigger” agreements, meaning that two events must occur in order for payments to be made: (i) a change of control must occur; and (ii) an adverse employment action must occur, meaning that the Company must terminate the executive’s employment other than for cause or disability or the executive must terminate his employment for good reason. Double trigger agreements were chosen to protect the shareholders from executives choosing to leave the Company as result of a change of control where there is no adverse employment action. All Change of Control Agreements were amended effective June 30, 2008, with the objective of complying with the provisions of IRS Code Section 409A (“409A Amendment”). See also the section entitled Compensation—Compensation of Named Executive Officers—Potential Payments Upon Termination or Change of Control for a full description of “change of control” as defined in the Change of Control Agreements.

Employment Agreement - Robert G. Schoenberger

The Company entered into an employment agreement (the “Employment Agreement”) with Mr. Schoenberger, which was effective November 1, 2015 for a term of three years, with an end date of October 31, 2018. Upon his voluntary retirement from the Company, Mr. Schoenberger’s employment will end. See also the section entitled Recent Events. For a detailed description of the Employment Agreement, see the sections entitled Compensation—Compensation of Named Executive Officers—Employment Agreement of the Chief Executive Officer and Compensation—Compensation of Named Executive Officers—Potential Payments Upon Termination or Change of Control.

Executive Perquisites

The Company limits the use of perquisites as a method of compensation. In 2017, Mr. Schoenberger received reimbursement for a club membership and was also provided with a Company automobile for both business and personal use. Please see the All Other Compensation column of the Summary Compensation Table in the section entitled Compensation—Compensation of Named Executive Officers. Both of these perquisites were provided to Mr. Schoenberger pursuant to his Employment Agreement. No other perquisites are provided to Mr. Schoenberger or any Named Executive Officer.

INTERNAL REVENUE CODE SECTION 162(M)

In general, under Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), the Company cannot deduct, for federal income tax purposes, compensation in excess of $1,000,000 paid to the CEO, CFO and certain Executive Officers. However, for the 2017 tax year, this deduction limitation did not apply to compensation that constituted “qualified performance-based compensation” within the meaning of Section 162(m) of the Code and applicable regulations, as then in effect. The Compensation Committee considers the limitations on deductions imposed by Section 162(m) of the Code and, for the 2017 tax year, the exception for “qualified performance-based compensation.” Beginning in 2018, the “qualified

performance-based compensation” exception under Section 162(m) of the Code will be eliminated, other than with respect to compensation payable pursuant to a written binding contract that was in effect on

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November 2, 2017 and is not materially modified after that date. The Committee reserves its right to authorize executive compensation that may or may not be subject to the deduction limitations of Section 162(m) of the Code when it believes that such compensation is appropriate and in the best interests of the Company and its shareholders.

STOCK OWNERSHIP REQUIREMENT FOR EXECUTIVE OFFICERS

The Company does not have a formal policy requiring stock ownership by Executive Officers. One of the key objectives of the Stock Plan is to promote ownership of the Company’s stock by members of management, including Executive Officers. The Company believes the Stock Plan has been successful in this objective.

OTHER EMPLOYEE BENEFITS

Active Employee Benefits

The Company provides a comprehensive package of employee benefits to substantially all employees. These benefits include several medical insurance plans, a dental insurance plan, a vision insurance plan, two group life insurance plans, a long-term disability insurance plan, a defined benefit pension plan, a 401(k) retirement savings plan (which includes company matching contributions), and other ancillary benefits plans and policies.

Retired Employee Benefits

The Company provides company-paid life insurance, as well as company-subsidized medical insurance, to qualifying retirees. For non-union employees hired before December 31, 2009 and retiring on or after January 1, 2010, the Company will subsidize post-retirement medical premiums at the same percentage as active employees. For employees hired after December 31, 2009, this subsidy ends when the retiree attains age 65. Post-retirement benefits for employees represented by unions are administered in accordance with the applicable collective bargaining agreement.

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COMPENSATION COMMITTEE REPORT

This report is submitted by the Compensation Committee of Unitil with respect to the review and approval of the Compensation Discussion and Analysis, which appears above.

In discharging its oversight responsibility, the Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management, and has recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement for the Annual Meeting.

Compensation Committee Members

Dr. Robert V. Antonucci, David P. Brownell, Lisa Crutchfield (chair), Eben S. Moulton and Dr. Sarah P. Voll

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COMPENSATION OF NAMED EXECUTIVE OFFICERS

Summary Compensation Table

The table below shows the information specified in paragraph (c)(2) of Item 402 of Regulation S-K concerning the compensation of the CEO, the CFO and the Company’s three other most highly compensated officers for each of fiscal years 2015, 2016 and 2017.

NOTES:

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NOTES, continued:

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NOTES, continued:

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Reported Versus Realized Pay in 2017

Since total reported pay for each Named Executive Officer in the 2017 Summary Compensation Table is comprised of a significant amount of potential pay, pay actually realized each year is also calculated. This total may include incentive compensation paid in 2017 for the prior year, and equity compensation that was granted in prior years, but vested in 2017. Generally, realized pay does not include the change in pension value or the value of restricted stock that is unvested at the time of grant. The table below shows realized pay in 2017 for each Named Executive Officer, as well as the percentage of realized pay to reported pay. For the years 2015 to 2017, in the aggregate, realized pay was an average of 62% of reported pay.

NOTES:

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Grants of Plan-Based Awards

The table below provides information with respect to the grants of plan-based awards, including Management Incentive Plan awards and Stock Plan awards, made to the Named Executive Officers for the year 2017.

NOTES:

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NOTES, continued:

NON-EQUITY COMPENSATION PLAN INFORMATION

Management Incentive Plan

The Management Incentive Plan, in which all Named Executive Officers participate, was established in December 1998. On June 5, 2013, the Management Incentive Plan was amended and restated to clarify that the Compensation Committee selects participants in the plan and establishes their individual target awards. The plan provides cash incentive payments that are tied directly to achievement of the Company’s performance metrics and goals. If the Company achieves the performance metrics and goals selected by the Committee, then the Company makes the cash incentive payments to participants early in the year following such achievement.

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On March 9, 2017, the Compensation Committee selected annual performance metrics and goals and target annual cash incentive awards for 2017 under the Management Incentive Plan. Based on 2017 results achieved as compared to the 2017 Management Incentive Plan performance goals, 148% of the target amount was earned, and the Committee approved payments of 148% of the target amount for Management Incentive Plan participants on January 29, 2018. For more detailed information with regard to performance metrics and goals, see the section entitled Compensation—Compensation Discussion and Analysis.

EQUITY COMPENSATION PLAN INFORMATION

Stock Plan

The Stock Plan is an equity-based plan in which selected management employees, including all Named Executive Officers, participate. Awards under the Stock Plan vary each year based on the achievement of the prior year’s annual incentive award performance goals. For more detailed information with regard to performance metrics and goals, see the section entitled Compensation Discussion and Analysis.

Based on 2017 results described above, awards of restricted stock were granted at 150% of the target amount. The Compensation Committee granted awards to Stock Plan participants on January 29, 2018. Grants of restricted stock generally vest at a rate of 25% per year beginning in the year following the year of the grant. All shares of restricted stock, regardless of vesting status, are fully eligible for quarterly dividend payments, as well as for participation in the Dividend Reinvestment and Stock Purchase Plan, and have full voting rights. In 2017, the Company paid four quarterly non-preferential dividends of $0.36 per share on all shares of common stock outstanding, which included all shares of unvested restricted stock, as of each respective record date.

The Compensation Committee sets the target restricted stock awards based upon recommendations from Willis Towers, with the goal of granting a target award with a value equal to the market median of the broad-based published compensation survey group at the time of the grant. The Committee also used information from the proxy statements of the Company’s peer group, at the 25^th percentile target, as a secondary source to set the CEO’s target award. This award is then reduced for anticipated income taxes and Medicare taxes, with plan participants receiving the shares net of such taxes, subject to the vesting schedule. As the shares vest, they become taxable income to the participant, and the taxes, previously accounted for, are credited back to participants. This procedure reduces both the dilutive effect of the Stock Plan by granting fewer shares than would otherwise be granted, and the volatility of the Company’s stock in the market by eliminating participants’ sale of vested shares that may be otherwise completed to pay personal income taxes. Additional information concerning the process for calculating grants of restricted stock is included in the section entitled Compensation—Compensation Discussion and Analysis.

The restricted stock may not be sold, transferred, pledged, assigned or otherwise alienated or hypothecated prior to vesting. Unvested restricted stock is subject to forfeiture if the participant’s employment is terminated for any reason other than the participant’s death, disability, retirement, or in connection with a change of control. Under the terms of the Company’s Stock Plan, all unvested shares become fully vested

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upon retirement. According to IRS regulations, shares of restricted stock become taxable as current income

when they become non-forfeitable, which is upon eligibility for retirement. Taxes are paid on this additional taxable income. Upon the occurrence of death, disability, or a change of control of the Company, unless otherwise specifically prohibited under applicable laws, any restrictions and transfer limitations imposed on restricted stock will immediately lapse. The term “change of control” is defined in the section entitled Compensation—Compensation of Named Executive Officers—Definition of Change of Control, Cause and Good Reason.

Salary in Proportion to Total Compensation

The table below provides information with respect to salary in proportion to total compensation for Named Executive Officers for the year 2017.

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Option Exercises & Stock Vested

The table below provides information with respect to the shares of stock granted under the Stock Plan in previous years that vested during 2017.

NOTES:

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Outstanding Equity Awards at Fiscal Year End

The table below provides information with respect to the outstanding equity awards of the Named Executive Officers as of December 31, 2017, which includes unvested stock awards granted under the Stock Plan. The Company has no option plan and no option awards outstanding.

NOTES:

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EMPLOYMENT AGREEMENT

Mr. Schoenberger is currently the only employee who has an Employment Agreement with the Company, the term of which is November 1, 2015 through October 31, 2018. The Employment Agreement also provides that Mr. Schoenberger will participate in the Management Incentive Plan, the SERP, other employee benefit plans available to the Company’s executives, and the Company’s stock plans (which include the Stock Plan). The Employment Agreement also states that Mr. Schoenberger’s Change of Control Agreement will remain in effect. The Employment Agreement’s termination provisions are discussed below under the section entitled Compensation—Compensation of Named Executive Officers—Potential Payments Upon Termination or Change of Control.

THE RETIREMENT PLAN

The Retirement Plan is a tax-qualified defined benefit pension plan and related trust agreement that provides retirement annuities for eligible employees of Unitil and its subsidiaries. Since the Retirement Plan is a defined benefit plan, contributions are made by Unitil generally for all participants, and no amounts were contributed or accrued specifically for the benefit of any Executive Officer of Unitil under the Retirement Plan. Directors of Unitil who are not or have not been officers of Unitil or any of its subsidiaries are not eligible to participate in the Retirement Plan. Please see the section entitled Compensation—Compensation Discussion and Analysis for information regarding the closure of the Retirement Plan, which became effective on June 1, 2013.

The Retirement Plan provides participants with early retirement benefits upon the attainment of age 55 with at least 15 years of service. The early retirement benefit is an unreduced pension at age 60 with a reduction of 5% per year for each year prior to age 60. As of December 31, 2017, Mr. Collin, Mr. Meissner, and Mr. Brock are the Named Executive Officers eligible for early retirement benefits under the Retirement Plan. Mr. Schoenberger is eligible for normal retirement. A participant is 100% vested for benefits under the Retirement Plan after five years of service with Unitil or one of its subsidiaries. The formula for determining annual benefits under the Retirement Plan’s life annuity option is shown below.

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Pension Benefits

The table below provides information with respect to the actuarial present value of the accumulated benefit under the Retirement Plan and the SERP for all Named Executive Officers as of December 31, 2017.

NOTES:

ANNUAL BENEFITS UNDER RETIREMENT PLAN LIFE ANNUITY OPTION FORMULA 2% of average annual salary for each of the first 20 years of benefit service (average annual salary during the five consecutive years out of the last 20 years of employment that give the highest average salary) plus (+) 1% of average annual salary for each of the next 10 years of benefit service plus (+) 1/2% of average annual salary for each year of benefit service in excess of 30 minus(-) 50% of age 65 annual Social Security benefit (as defined in the Retirement Plan) minus(-) any benefit under another Unitil retirement plan of a former employer for which credit for service is given under the Retirement Plan

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THE SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

The Company also maintains a SERP, a non-qualified defined benefit plan. The SERP provides for supplemental retirement benefits to executives selected by the Board. As of December 31, 2017, Mr. Schoenberger, Mr. Collin, Mr. Meissner, and Mr. Black have been selected by the Board to receive SERP benefits upon attaining normal retirement eligibility, which occurs when the participant attains age 65, or early retirement eligibility, which occurs when the participant attains both age 55 and has completed 15 years of service. For a participant who elects to begin receiving early retirement benefits under the SERP prior to attaining age 60, the benefits are reduced by 0.417 of 1% for each full calendar month that commencement of benefits precedes attainment of age 60. As of December 31, 2017, of the Named Executive Officers participating in the SERP, Mr. Collin and Mr. Meissner are eligible for early retirement. Mr. Schoenberger is eligible for normal retirement.

If a participant terminates employment for any reason prior to retirement, other than due to death or in connection with a change in control as described below, the participant will not be entitled to any benefits under the SERP. Annual benefits are based on an amount equal to 60% of a participant’s final average earnings, which includes annual salary and annual cash incentives, less the participant’s benefits payable under the Retirement Plan, less other retirement income payable to the participant by Unitil or any previous employer, and less income that a participant receives as a primary Social Security benefit.

If a change in control occurs and a participant’s employment terminates prior to the earlier to occur of the participant being eligible for retirement or early retirement, then the participant will begin to receive benefits on the earlier to occur of the date on which they would have attained normal or early retirement eligibility. In this case, the participant’s benefits would be determined by assuming the participant had remained employed and continued to accrue additional years of service. The term “change in control” as used in the SERP is defined in the section entitled Compensation—Compensation of Named Executive Officers—Definition of Change of Control, Cause and Good Reason.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL

Upon termination of employment following a change of control of the Company, severance benefits will be paid to the Named Executive Officers. The severance benefits for termination other than a change of control that are payable to Mr. Schoenberger are addressed in his Employment Agreement, discussed below, and he would receive the benefits provided to him under that agreement. The other Named Executive Officers are not covered under employment agreements and any severance benefits payable to them would be paid in the event of an adverse employment action following a change of control of the Company. In addition, the Stock Plan provides that unvested restricted stock will vest immediately upon (i) death, (ii) disability (as defined in the Company’s Long-Term Disability Plan), (iii) retirement or (iv) a change of control of the Company (as defined in the Stock Plan). The Management Incentive Plan also provides that unvested awards under the plan are forfeited if the participant’s employment terminates other than by reason of (i) death, (ii) disability (as defined in the Company’s Long-Term Disability Plan) or (iii) retirement at or after attaining age 55.

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Change of Control

The Company maintains Change of Control Agreements with certain key management employees, including all Named Executive Officers, to provide continuity in the management and operation of the Company and its subsidiaries, and so that key management employees will make decisions and take actions that are in the best interest of shareholders and not unduly influenced by the fear of job loss in the event of a change of control. The Board approves all Change of Control Agreements. The Company maintains both two-year (executed in 2001 and later) Change of Control Agreements and three-year (executed prior to 2001) Change of Control Agreements. All existing Change of Control Agreements are “double trigger” agreements, meaning that two events must occur in order for benefits to be paid: (i) a change of control must occur (upon which the agreement becomes effective); and (ii) an adverse employment action must occur during the term of the agreement, meaning that the Company must terminate the executive’s employment other than for cause or disability or the executive must terminate his employment for good reason. The term of each Change of Control Agreement begins upon a change of control of the Company. Double trigger Change of Control Agreements were chosen to discourage executives from choosing to leave the Company as the result of a change of control where there is no adverse employment action. The terms “change of control” and “cause” and “good reason” are defined in the section entitled Compensation—Compensation of Named Executive Officers—Definition of Change of Control, Cause and Good Reason.

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Estimated Present Value of Benefits

The following tables show the payments and benefits the Named Executive Officers would have received in connection with a variety of employment termination scenarios, as well as upon a change of control, assuming that employment termination or the change of control was effective as of December 31, 2017. The actual amounts that would be paid can only be determined at the time of an actual separation from the Company. All of the payments and benefits described below would be provided by the Company or its subsidiaries.