SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-1004
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) March 1, 2005
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NORTHEAST UTILITIES
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(Exact name of registrant as specified in its charter)
MASSACHUSETTS 1-5324 04-2147929
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(State or other jurisdiction of (Commission (I.R.S. Employer
organization) File Number) Identification No.)
ONE FEDERAL STREET, BUILDING 111-4, SPRINGFIELD
MASSACHUSETTS 01105
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(Address of principal executive offices) (Zip Code)
(860) 665-5500
(Registrant's telephone number, including area code)
Not Applicable
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K/A filing is intended to
simultaneously satisfy the filing obligation of the registrant under
any of the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d- 2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e- 4(c))
Item 1.01 Entry into a Material Definitive Agreement
On March 1, 2005, the Compensation Committee of the Board of Trustees of
Northeast Utilities (the 'Company') approved the payment of
discretionary annual incentive awards for 2004 and approved the 2005
Annual Incentive Program and the 2005-2007 Long-Term Incentive Program
under the Northeast Utilities Incentive Plan. These actions are further
described below.
1. 2004 Discretionary Annual Incentive Awards. The Compensation
Committee paid the following cash awards to certain Executive Officers
in recognition of strong performance of the regulated operating
companies, corporate staff units, and certain segments of the
competitive business which achieved or exceeded the goals established
for those units. All awards paid to these Executive Officers were
reduced significantly in light of the underperformance in certain other
segments of the competitive business. Awards equivalent to 45% of the
2004 Annual Incentive Program pool at target were made. These awards
are considered discretionary and, as such, a portion of the payments
to certain of the executives may not be deductible by the Company
for 2005 federal income tax purposes.
Charles W. Shivery $200,000
David H. Boguslawski $ 42,957
Cheryl W. Grise' $234,949
Gregory B. Butler $ 75,316
Leon J. Olivier $143,521
2. 2005 Annual Incentive Program Approved. The 2005 Annual
Incentive Program under the Northeast Utilities Incentive Plan for
executive officers of the Company is significantly revised from the
2004 program to more directly relate an individual's incentive payout
to the performance of the specific business that he or she can
directly impact. Performance metrics are established that reflect
the financial, strategic and operational goals that measure business
success at each executive level. In addition, adjusted net income
financial performance thresholds are set by the Compensation
Committee that must be achieved before an individual can be eligible
for an incentive award. Target incentive opportunities for executives
under this Program are established using survey data for individuals
in comparable positions and markets. Incentive awards, if any, are
paid in cash after the end of 2005.
3. 2005-2007 Long-Term Incentive Program Approved. The
Compensation Committee of the Company approved the Long-Term Incentive
Program for 2005 through 2007, under which awards of restricted share
units and three-year performance cash units are made. Target incentive
opportunities for executives under this Program are established using
survey data for individuals in comparable positions and markets.
Restricted share units are awarded from a pool whose value before
adjusting for performance is half of the long-term incentive program at
target. The size of the pool of restricted share units is established
based on corporate achievement of the previous year's goals, that
year's contribution to the Company's longer-term strategic direction
and the need to motivate future performance. The actual number of
restricted share units awarded to each officer is based on a target
that is adjusted to reflect performance and contribution of the
individual. These restricted share units vest over three years and
payment of half of the vested units is deferred an additional four
years beyond vesting to further increase share ownership by executives.
Half of the Long-Term Incentive Program value at target is
awarded as three-year performance cash units to officers. Performance
cash units will be valued at the end of the three-year performance
period that ends December 31, 2007, assessed on the degree of
achievement of pre-defined levels of cumulative adjusted net
income, return on equity, time-weighted average credit ratings,
and total shareholder return as compared to a group of comparable
utility companies. The ultimate value of the performance cash
units, if any, will be determined at the end of the three-year
performance period and paid in cash.
[SIGNATURE PAGE TO FOLLOW]
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
NORTHEAST UTILITIES
(Registrant)
By: /s/ Randy A. Shoop
Name: Randy A. Shoop
Title: Vice President and Treasurer
Date: March 7, 2005