2002 SHORT-TERM INCENTIVE PLAN
EX-10.25 7 dex1025.htm 2002 SHORT TERM INCENTIVE PLAN Prepared by R.R. Donnelley Financial -- 2002 Short Term Incentive Plan
EXHIBIT 10.25
2002 SHORT-TERM INCENTIVE PLAN
Background
At its meeting on February 20, 2002, the Nominating and Compensation Committee reviewed and approved the 2002 Short-Term Incentive Plan (STIP) for officers of PG&E Corporation and each subsidiary. The structure (Appendix A) establishes the weighting of corporate earnings per share (EPS), subsidiary EPS, and other performance factors for officers, including the credit ratings for PG&E National Energy Group, Inc. and its subsidiary, PG&E Energy Trading Holdings Corporation (Appendix B).
ATTACHMENT A
REVISED 2002 SHORT-TERM INCENTIVE PLAN STRUCTURE
| Officer Group | Award Component | Weight | Performance Measures | |||
| PG&E Corporation | Corporate Financial Performance | 50% | Corporate EPS from operations | |||
| Credit Rating | 50% | Credit rating of PG&E National Energy Group | ||||
| President and CEO – Pacific Gas and Electric Company | Corporate Financial Performance | 50% | Corporate EPS from operations | |||
| Subsidiary Performance | 50% | Respective subsidiary contribution to corporate EPS from operations | ||||
| President and CEO – PG&E National Energy Group | Credit Rating | 50% | Credit rating of PG&E National Energy Group | |||
| Corporate Financial Performance | 25% | Corporate EPS from operations | ||||
| Subsidiary Financial Performance | 25% | Respective subsidiary contribution to corporate EPS from operations | ||||
| Pacific Gas and Electric Company | Corporate Financial Performance | 25% | Corporate EPS from operations | |||
| Subsidiary Financial Performance | 50–75% | Respective subsidiary contribution to corporate EPS from operations | ||||
| Subsidiary Operational Performance | 0–25% | Financial, operating, and service measures determined by subsidiary CEO | ||||
| PG&E National Energy Group | Credit Rating | 50% | Credit rating of PG&E National Energy Group | |||
| Corporate Financial Performance | 25% | Corporate EPS from operations | ||||
| Subsidiary Financial Performance | 0–25% | Respective subsidiary contribution to corporate EPS from operations | ||||
| Subsidiary Operational Performance | 0–25% | Financial, operating, and service measures determined by subsidiary CEO |
ATTACHMENT B
2002 STIP: CREDIT RATING PERFORMANCE MEASURE
| Payout Level | Score | Performance Measure | ||
| Maximum | 2.00 | Increase in either credit rating agency’s rating for PG&E National Energy Group or Energy Trading; the other credit ratings remain unchanged. | ||
| Above Target | 1.75 | Both agencies’ credit ratings unchanged for PG&E National Energy Group and PG&E Energy Trading | ||
| Target | 1.00 | Both agencies’ credit ratings at investment grade for PG&E National Energy Group and PG&E Energy Trading | ||
| Threshold | 0.50 | Both agencies’ credit ratings at investment grade for PG&E National Energy Group or PG&E Energy Trading | ||
| No Payout | 0.00 | Both agencies’ credit ratings at below investment grade for PG&E National Energy Group and PG&E Energy Trading |
The agencies referred to above are Standard and Poor’s and Moody’s credit rating agencies.
