8-KLeadership ChangesExhibits & Filings

CENTERPOINT ENERGY INC 8-K Report, Executive Changes (Feb 24, 2009)

Filed February 24, 2009For Securities:CNP

Summary

This Form 8-K filing from CenterPoint Energy, Inc. (CNP) on February 24, 2009, details the Compensation Committee's decisions regarding executive compensation for the upcoming year and performance cycle. Key decisions include the establishment of performance targets and potential payouts for the 2009 short-term incentive plan and the authorization of long-term incentive awards for the 2009-2011 performance cycle. Notably, the filing indicates that base salaries for named executive officers remained unchanged for 2009 following the annual review. The long-term incentive plan saw adjusted target award percentages for several key executives, while the performance metrics for both short-term and long-term plans remain consistent with prior disclosures. New forms of award agreements were approved to clarify treatment for retirement-eligible employees and to specify that termination for cause results in no payout. Investors should note the emphasis on performance-based compensation and the consistent incentive structures from previous periods.

Key Highlights

  • 1CenterPoint Energy's Compensation Committee set performance targets and payout potentials for the 2009 Short-Term Incentive Plan.
  • 2Target award percentages for the 2009 Short-Term Incentive Plan were confirmed for key executives, with the CEO's target at 100% of earnings and others ranging from 70% to 75%.
  • 3Long-Term Incentive Plan awards for the 2009-2011 performance cycle were authorized, utilizing performance shares and stock tied to specific goals.
  • 4Target award percentages for the Long-Term Incentive Plan (2009-2011) were increased for Messrs. Whitlock, Rozzell, and Standish to 140% of earnings, and Mr. Harper's target was set at 90%. Mr. McClanahan's target remains at 200% of earnings.
  • 5Performance metrics for both short-term and long-term incentive plans remain consistent with prior disclosures, focusing on total shareholder return, operating income, and modified cash flow for long-term awards.
  • 6New forms of long-term incentive award agreements were approved, clarifying provisions for retirement-eligible participants and stipulating no benefits upon termination for cause.
  • 7The Compensation Committee conducted its annual review of executive base salaries and decided not to implement any changes for 2009.

Frequently Asked Questions

This filing primarily details the determination of performance targets for the 2009 short-term incentive plan and the authorization of long-term incentive awards for the 2009-2011 performance cycle. While base salaries remained unchanged, target award percentages for the long-term incentive plan were adjusted for several key executives. The performance metrics for both plans are consistent with prior disclosures.

Both the short-term and long-term incentive plans are performance-based. The short-term plan offers annual cash awards based on specified performance goals. The long-term plan awards performance shares and stock based on metrics like total shareholder return, operating income, and modified cash flow over a multi-year period (2009-2011).

New forms of agreement for long-term incentive awards now clarify that participants who become 'retirement eligible' (age 55 with five years of service) and terminate employment during the performance period will receive a pro-rated payment based on the actual achievement of performance objectives at the end of the period.

No, according to this filing, the Compensation Committee conducted its annual review of base salaries paid to the Company's named executive officers and made no changes to their salaries for 2009.