8-KMaterial Agreements

TRAVELERS COMPANIES, INC. 8-K Report, Material Agreement (Mar 18, 2005)

Filed March 18, 2005For Securities:TRV

Summary

The St. Paul Travelers Companies, Inc. filed a Form 8-K on March 18, 2005, detailing actions taken by its Compensation Committee on March 16, 2005. The committee established maximum award percentages for the company's Named Executive Officers under the Senior Executive Performance Plan for the 2005 fiscal year. These awards are contingent on the company's financial performance and other factors, including integration progress and expense reduction goals following the merger of The St. Paul Companies, Inc. and Travelers Property Casualty Corp. on April 1, 2004. This filing is significant as it outlines the potential incentive compensation structure for key executives. Investors should note that the actual bonus payments will depend on the company's 2005 financial results and the Compensation Committee's discretion. The specified percentages represent the maximum possible payouts and are tied to the overall incentive pool generated by the company's performance, with a particular emphasis on achieving synergies from the prior year's merger.

Key Highlights

  • 1The Compensation Committee of The St. Paul Travelers Companies, Inc. set maximum award percentages for Named Executive Officers for fiscal year 2005.
  • 2The CEO has a maximum award of 35% of the incentive pool.
  • 3The Chairman has a maximum award of 25% of the incentive pool.
  • 4The other three most highly compensated executives have maximum award percentages of 15% and 10%.
  • 5Bonus payments are contingent on the company's 2005 financial performance.
  • 6Performance factors include progress on the integration of The St. Paul Companies and Travelers Property Casualty Corp.
  • 7Achieving post-merger expense reduction goals is also a key performance metric for executive bonuses.

Frequently Asked Questions

This 8-K filing serves to inform investors about the establishment of maximum award percentages for the company's top executives under its Senior Executive Performance Plan for the 2005 fiscal year. It also highlights the performance metrics that will influence the actual bonus payouts.

No, the percentages represent the maximum potential awards. The actual bonus payments will be determined by the Compensation Committee based on the company's 2005 financial results and the size of the available incentive pool. The committee has discretion over what portion of the maximum allocation, if any, will be paid.

Executive bonuses for 2005 will be influenced by the company's overall financial performance. Additionally, the progress made in integrating The St. Paul Companies and Travelers Property Casualty Corp., as well as the achievement of post-merger expense reduction targets, are specifically cited as important performance factors.

The filing states that the Senior Executive Performance Plan itself is filed as an exhibit to the Company's annual report on Form 10-K for the year ended December 31, 2003. Investors can refer to that document for further details on the plan's structure and provisions.