<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
FILED BY THE REGISTRANT /X/ FILED BY A PARTY OTHER THAN THE REGISTRANT / /
- --------------------------------------------------------------------------------
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
Green Mountain Power Corporation
(Name of Registrant as Specified In Its Charter)
Green Mountain Power Corporation
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11:
4) Proposed maximum aggregate value of transaction:
Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / 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.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE> 2
[GREEN MOUNTAIN POWER CORPORATION LOGO]
25 GREEN MOUNTAIN DRIVE
P.O. BOX 850
SOUTH BURLINGTON, VERMONT 05402
April 15, 1994
TO OUR SHAREHOLDERS:
You are cordially invited to attend the Annual Meeting of Shareholders of
Green Mountain Power Corporation, which will be held at the headquarters
building, 25 Green Mountain Drive, South Burlington, Vermont, on Thursday, May
19, 1994, at 10:00 a.m., EDST. The accompanying Notice of Meeting and Proxy
Statement describe the matters to be acted on at the Meeting.
For your convenience, a map showing the location of the corporate
headquarters is printed on the reverse side of this letter.
Regardless of the number of shares you own, it is important that your
shares be represented at the Meeting. We hope that you will be able to attend
personally and urge you to do so if it is at all possible. In any event, we ask
that you sign and complete the enclosed proxy and return it to us promptly. If
you are able to attend the Meeting, you may revoke the proxy at that time and
vote your shares personally. If for any reason you are not able to attend the
Meeting, your signed proxy will assure proper representation of your ownership
interests in Green Mountain Power Corporation.
Commencing at 9:00 a.m., prior to the Meeting, refreshments will be served.
You are encouraged to arrive in sufficient time to complete registration before
the Meeting convenes at 10:00 a.m. Following the Meeting, you are invited to
attend a picnic lunch to be served on the lawn at the headquarters building.
To help us to plan for the Meeting and lunch, we would appreciate your
completing the enclosed reply card and returning it to us.
Thank you for your continued interest in the Company.
Sincerely,
DOUGLAS G. HYDE
President and
Chief Executive Officer
<PAGE> 3
[MAP SHOWING DIRECTIONS TO GREEN MOUNTAIN
POWER CORP.'S ANNUAL MEETING OF SHAREHOLDERS.]
<PAGE> 4
[GREEN MOUNTAIN POWER CORPORATION LOGO]
25 GREEN MOUNTAIN DRIVE
P.O. BOX 850
SOUTH BURLINGTON, VERMONT 05402
NOTICE OF MEETING
To the Shareholders of
GREEN MOUNTAIN POWER CORPORATION:
Notice is hereby given that the Annual Meeting of the Shareholders of Green
Mountain Power Corporation will be held at the headquarters building, 25 Green
Mountain Drive, South Burlington, Vermont, on Thursday, May 19, 1994, at 10:00
o'clock in the forenoon (Eastern Daylight Savings Time), for the following
purposes:
Item 1. To elect a Board of Directors; and
Item 2. To vote on such other matters as may properly come before the
Meeting and any and all adjournments thereof;
all as set forth in the Proxy Statement accompanying this notice.
Only holders of record of Common Stock as shown on the stock transfer books
of the Company at the close of business on April 8, 1994, will be entitled to
vote at the Meeting or any adjournments thereof.
By Order of the Board of Directors,
DONNA S. LAFFAN
Secretary
Date: April 15, 1994
IMPORTANT
IF YOU CANNOT BE PRESENT AND DESIRE TO HAVE YOUR STOCK VOTED AT THE
MEETING, PLEASE MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY IN THE ENVELOPE
PROVIDED.
<PAGE> 5
PROXY STATEMENT
GREEN MOUNTAIN POWER CORPORATION
25 GREEN MOUNTAIN DRIVE
P.O. BOX 850
SOUTH BURLINGTON, VERMONT 05402
------------------------
ANNUAL MEETING OF SHAREHOLDERS
MAY 19, 1994
------------------------
APRIL 15, 1994
PROXY AND SOLICITATION
The accompanying proxy is solicited on behalf of the Board of Directors of
Green Mountain Power Corporation (the "Company") for use at the Annual Meeting
of Shareholders of the Company to be held on Thursday, May 19, 1994, and at any
and all adjournments thereof. This proxy statement and the accompanying form of
proxy are being sent to the shareholders on or about April 15, 1994.
The cost of soliciting proxies by the Board of Directors will be borne by
the Company, including the charges and expenses of brokers and others for
sending proxy material to beneficial owners of Common Stock. In addition to the
use of the mails, proxies may be solicited by personal interview, by telephone
or by telegraph by certain of the Company's employees without compensation
therefor. The Company has retained Morrow & Co. to assist in the solicitation of
proxies at an estimated cost of $4,500, plus reimbursement of reasonable out-
of-pocket expenses.
Shareholders who execute proxies retain the right to revoke them by
notifying the Corporate Secretary by mail at the above address or in person at
the Annual Meeting before they are voted. A proxy in the accompanying form when
it is returned properly executed will be voted at the Meeting in accordance with
the instructions given, and if no instructions are given, the proxy will be
voted in accordance with the recommendation of the Board of Directors.
STOCK OUTSTANDING AND VOTING RIGHTS
On April 8, 1994, the record date for the Meeting, the Company had
outstanding 4,551,012 shares of Common Stock (excluding 15,856 of such shares
held by the Company as Treasury Stock), which is the only class of stock
entitled to vote at the Meeting. Each holder of record of Common Stock on the
record date is entitled to one vote for each share of Common Stock so held.
The affirmative vote by the holders of a majority of the shares represented
at the Annual Meeting is required for the election of directors (Item 1 herein).
Abstentions and broker non-votes (when shares are represented at the Annual
Meeting by a proxy specifically conferring only limited authority to vote on
particular matters) will not be counted as votes in favor of the election of
directors (Item 1 herein).
The shares of Common Stock represented by each properly executed proxy
received by the Board of Directors will be voted at the Annual Meeting in
accordance with the instructions specified therein. If no instructions are
specified, such shares of Common Stock will be voted FOR the election of
nominees for
<PAGE> 6
Directors (Item 1 herein). The Board of Directors knows of no other business to
come before the Annual Meeting. However, if any other matters are properly
presented at the Annual Meeting, or any adjournment thereof, the persons voting
the proxies will vote them in accordance with their best judgment. Any proxy may
be revoked by notifying the Secretary of the Company in writing at any time
prior to the voting of the proxy.
<TABLE>
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
To the knowledge of the Company, no person owned beneficially more than 5%
of the outstanding Common Stock of the Company on April 8, 1994.
The following table sets forth, as of January 31, 1994, information
relating to the ownership of the Company's Common Stock by each nominee for
Director, by each of the Executive Officers named in the Summary Compensation
Table and by all Directors and Executive Officers as a group.
<CAPTION>
COMMON STOCK
BENEFICIALLY
OWNED(1)
-------------------
<S> <C>
Robert E. Boardman................................ 1,271
Nordahl L. Brue................................... 1,361(2)
William H. Bruett................................. 1,500
Merrill O. Burns.................................. 1,581
Lorraine E. Chickering............................ --
John V. Cleary.................................... 1,954
Richard I. Fricke................................. 2,900(3)
Douglas G. Hyde................................... 4,496
Euclid A. Irving.................................. 315
Martin L. Johnson................................. 829
Ruth W. Page...................................... 1,100(4)
Thomas P. Salmon.................................. 1,000
Christopher L. Dutton............................. 1,225(5)
Edwin M. Norse.................................... 759
Thomas V. O'Connor, Jr............................ --
A. Norman Terreri................................. 2,453(6)
Stephen C. Terry.................................. 1,242(7)
All directors and Executive
Officers as a group (27 persons)................ 30,984
- ---------------
<FN>
(1) Each listed individual exercises sole voting and investment power over all
of the shares of Common Stock beneficially owned, except as noted herein
below. As of January 31, 1994, no Director, nominee or listed Executive
Officer owned beneficially as much as 1% of the Company's outstanding
Common Stock.
(2) Mr. Brue owns 1,235 of these shares directly. The remaining 126 shares are
owned by Mr. Brue's children for whom Mr. Brue serves as custodian; Mr.
Brue disclaims any other beneficial interest in the 126 shares owned by his
children.
(3) Mr. Fricke owns 2,500 of these shares directly. His wife owns the remaining
400 of these shares; Mr. Fricke disclaims any other beneficial interest in
the 400 shares owned by his wife.
(4) Mrs. Page owns 900 of these shares directly. Her husband owns the remaining
200 of these shares; Mrs. Page disclaims any other beneficial interest in
the 200 shares owned by her husband.
</TABLE>
2
<PAGE> 7
(5) Mr. Dutton owns 1,164 of these shares directly. The remaining 61 are owned
by Mr. Dutton's children for whom Mr. Dutton's spouse serves as custodian;
Mr. Dutton disclaims any other beneficial interest in the 61 shares owned
by his children.
(6) Mr. Terreri owns 2,129 of these shares directly. His wife owns the remaining
324 of these shares; Mr. Terreri disclaims any other beneficial interest in
the 324 shares owned by his wife.
(7) Mr. Terry owns 1,212 of these shares directly. His wife owns the remaining
30 of these shares; Mr. Terry disclaims any other beneficial interest in the
30 shares owned by his wife.
As of January 31, 1994, all Directors and Executive Officers of the Company
as a group (consisting of 27 persons) beneficially owned an aggregate of 30,984
shares (or approximately 0.7% of the outstanding shares) of Common Stock.
ITEM 1. NOMINEES FOR ELECTION AS DIRECTOR
The shares of Common Stock represented by the proxies that are executed and
returned in the accompanying form will be voted at the Meeting (unless authority
is withheld) to elect as Directors the nominees listed below to serve until the
next Annual Meeting of Shareholders and until their successors shall have been
elected and qualified. Should any of the nominees become unavailable for
election for any reason, the proxies will be voted for the election of such
other person or persons as may be designated by the Board of Directors.
<TABLE>
NOMINEES FOR DIRECTOR
<CAPTION>
BUSINESS EXPERIENCE FOR THE PAST FIVE DIRECTOR
NAME YEARS AND OTHER INFORMATION (AGE) SINCE
---- ------------------------------------- --------
<S> <C> <C>
Robert E. Boardman....... Chairman of Hickok and Boardman, Inc.(insurance agency); 1974
(A)(D) President of Hickok & Boardman Realty, Inc.; Director of
Bank of Vermont, of National Life Insurance Company
and of Mount Mansfield Corporation (recreation);
Trustee of Lake Champlain Maritime Museum. Marco
Island, Florida. (61)
Nordahl L. Brue.......... Chairman of Bruegger's Corporation (quick-service 1992
(C)(E) restaurants); Chairman of Executive Committee of
Franklin County Cheese and Frank Hahn, Inc. (dairy
manufacturing and distribution business); Principal of
Champlain Management Services, Inc. (real estate
development and management enterprises); Stockholder,
Sheehey Brue Gray & Furlong, P.C., Attorneys, Burling-
ton, Vermont; Director and Officer of the Vermont
Business Roundtable; Member of the Governor's Council
of Economic Advisors. Burlington, Vermont. (49)
William H. Bruett........ Chairman and Chief Executive Officer and Director of 1986
(A)(B)(C)(D) PaineWebber Trust Co. and Chairman of PaineWebber
International Bank Ltd., London, subsidiaries of
PaineWebber Group, Inc., since 1990; President, Chief
Executive Officer and Director of Chittenden
Corporation and of Chittenden Trust Company from 1984
to 1990. Gladstone, New Jersey. (50)
</TABLE>
3
<PAGE> 8
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE FOR THE PAST FIVE DIRECTOR
NAME YEARS AND OTHER INFORMATION (AGE) SINCE
---- ------------------------------------- --------
<S> <C> <C>
Merrill O. Burns......... Senior Vice President and Executive Corporate 1988
(A)(B)(D) Development Officer, Bank America Corporation since
1991; President and Managing Director of BankAmerica
International from 1988 to 1991. San Francisco,
California. (47)
Lorraine E. Chickering... President of Public and Operator Services of Bell --
Atlantic Corporation since 1993; Vice President,
Operations and Engineering of Chesapeake and Potomac
Telephone Company, a subsidiary of Bell Atlantic
Corporation from 1991 to 1993; Assistant Vice
President, Marketing Operations of Bell Atlantic
Corporation from 1989 to 1991. McLean, Virginia. (43)
John V. Cleary........... Retired Chief Executive Officer and President of the 1980
(A)(C)(E) Company; Chief Executive Officer, President and Chairman
of the Executive Committee of the Company from 1983 to
1993. Boynton Beach, Florida. (65)
Richard I. Fricke........ Director of National Life Insurance Company, of Sentinel 1984
(A)(B)(D) Group Funds, Inc. and of Sentinel Pennsylvania Tax-Free
Fund, Inc.; President and Chief Executive Officer of
the Bank of Vermont from 1987 to 1989; Retired
Chairman of the Board and Chief Executive Officer of
National Life Insurance Company; Fellow of the
American Bar Foundation; Member of the Board of
Overseers, Middlebury College, of the Cornell
University Council and of the Cornell Law School
Advisory Council. Bonita Springs, Florida. (72)
Douglas G. Hyde.......... President, Chief Executive Officer and Chairman of the 1986
(A)(C)(E) Executive Committee of the Company since 1993; Executive
Vice President and Chief Operating Officer of the
Company from 1989 to 1993; Executive Vice President
from 1986 to 1989; Director of Vermont Yankee Nuclear
Power Corporation, of Vermont Electric Power Company,
Inc., of Associated Edison Illuminating Companies, and
of Vermont Business Roundtable; Chairman of the Board
of Trustees of the Medical Center Hospital of Ver-
mont. Shelburne, Vermont. (51)
Euclid A. Irving......... Partner, Paul, Hastings, Janofsky & Walker, Attorneys, 1993
(B)(D)(E) New York, New York, since 1990; Partner, Mudge Rose
Guthrie Alexander & Ferdon, Attorneys, New York, New
York from 1984 to 1990. New York, New York. (41)
Martin L. Johnson........ President of The Johnson Company (environmental and 1991
(B)(C) engineering consultants) since 1978; Secretary of the
State of Vermont Agency of Environmental Conservation
from 1973 to 1978. Montpelier, Vermont. (66)
Ruth W. Page............. Writer, Editor and Radio Commentator; past member of the 1985
(B)(C) Northeast Energy Council of the United States
Department of Energy. Burlington, Vermont. (73)
</TABLE>
4
<PAGE> 9
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE FOR THE PAST FIVE DIRECTOR
NAME YEARS AND OTHER INFORMATION (AGE) SINCE
---- ------------------------------------- --------
<S> <C> <C>
Thomas P. Salmon......... Chairman of the Board of the Company since 1983; 1978
(A)(C)(D)(E) President of the University of Vermont since February 4,
1993; Interim President of the University of Vermont
from 1991 to 1993; On leave from Salmon and Nostrand,
Attorneys, Bellows Falls, Vermont; Governor of the
State of Vermont from 1973 to 1977; Director of Vermont
Electric Power Company, Inc., of Union Mutual Insurance
Company, of BankNorth Group, Inc. and of Central Vermont
Railway, Inc. Burlington, Vermont. (61)
- ---------------
<FN>
(A) Member of Executive Committee
(B) Member of Audit Committee
(C) Member of Nominating Committee
(D) Member of Compensation Committee
(E) Member of Special Issues Committee
</TABLE>
During 1993, each Director of the Company, except the President and the
Executive Vice President, earned an annual fee of $9,000 for service as a
Director. In addition to the annual fee, the Chairman of the Board earned
$20,000 for service as Chairman of the Board in 1993. The President and Chief
Executive Officer and the Executive Vice President and Chief Operating Officer
were not paid any fees for service as Directors. The Chairmen of the Audit,
Compensation, Nominating and Special Issues Committees earned annual fees of
$2,200 each for service in such capacity. The President, who is Chairman of the
Executive Committee, was not paid any fee for service in such capacity. For
attendance at meetings of the Board of Directors and of all committees of the
Board, Directors other than the President and Executive Vice President earned
$650 for each meeting attended in person (plus $325 for any meeting that
occurred on the same day as another meeting) and $325 for participation by means
of conference telephone. Travel and lodging expenses incurred by Directors
attending Board or committee meetings are paid by the Company. The Company also
maintains a Deferred Compensation Plan for Directors pursuant to which Directors
may defer receipt of all or part of the fees otherwise payable to them for
service as Directors.
Mr. Nordahl L. Brue, a Director of the Company, is a stockholder in the law
firm of Sheehey Brue Gray & Furlong, P.C. In prior years, the Company has
retained the services of Sheehey Brue Gray & Furlong, P.C. as special counsel
and has retained Sheehey Brue Gray & Furlong, P.C. to represent the Company in
certain matters during 1994. The Company paid Sheehey Brue Gray & Furlong, P.C.
$327,699 for legal services rendered in 1993.
Mr. Martin L. Johnson, a Director of the Company, is the President of The
Johnson Company, an environmental and engineering consulting firm. In 1993, the
Company retained the services of The Johnson Company to assist with
environmental matters and has retained The Johnson Company to assist with these
matters in 1994. The Company paid The Johnson Company $616,266 for services
rendered in 1993.
During 1993, the Board of Directors held four regular meetings and two
special meetings. During such year, no Director attended less than 75% of the
aggregate number of meetings of the Board of Directors and the committees on
which such Director served.
The committees of the Board of Directors include an Executive Committee, an
Audit Committee, a Nominating Committee, a Compensation Committee and a Special
Issues Committee, the members of which are identified on the foregoing table.
5
<PAGE> 10
The Executive Committee is vested with the powers of the Board of Directors
in the management of the current and ordinary business of the Company, except as
otherwise provided by law. During 1993, the Executive Committee held nine
meetings.
The Audit Committee (1) annually recommends to the Board of Directors the
appointment of independent public accountants of the Company, (2) reviews the
scope of audits and (3) receives, reviews and takes action deemed appropriate
with respect to audit reports submitted and other audit matters. The Audit
Committee met twice during 1993.
The function of the Nominating Committee is to recommend to the Board of
Directors persons selected by the Committee for nomination to the Board of
Directors. This Committee met four times during 1993. The Nominating Committee
will consider nominees recommended by shareholders. The names of any such
nominees should be forwarded to the Corporate Secretary, Green Mountain Power
Corporation, 25 Green Mountain Drive, P.O. Box 850, South Burlington, Vermont
05402, who will submit them to the Nominating Committee for its consideration.
The Compensation Committee is charged with the responsibility of reviewing
and making recommendations to the Board of Directors regarding the annual
salaries of Officers of the Company, recommending to the Board any needed
revisions to the compensation of Officers and of otherwise assisting the Board
in discharging its responsibilities in connection with the compensation of
Officers. The Compensation Committee met three times during 1993.
The Special Issues Committee addresses unusual, extraordinary or
miscellaneous issues that confront the Company from time to time. The Special
Issues Committee did not meet during 1993.
6
<PAGE> 11
EXECUTIVE COMPENSATION
The following Summary Compensation Table shows compensation earned by the
Executive Officers named in the table (the "Named Executive Officers") for
services rendered to the Company during fiscal years 1993, 1992 and 1991.
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
ANNUAL COMPENSATION(1)
------------------------ ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY INCENTIVE COMPENSATION(5)
--------------------------- ---- -------- --------- --------------
<S> <C> <C> <C> <C>
Douglas G. Hyde(2)....................... 1993 $179,243 $ 0 $ 5,681
President and Chief 1992 $149,046 $ 37,200 $ 4,434
Executive Officer 1991 $140,154 $ 42,200 $ 4,185
A. Norman Terreri........................ 1993 $144,023 $ 0 $ 5,207
Senior Vice President 1992 $135,600 $ 29,800 $ 4,509
and Chief Operating Officer 1991 $127,496 $ 33,200 $ 3,865
Edwin M. Norse........................... 1993 $110,373 $ 0 $ 3,679
Vice President, Chief Financial Officer 1992 $106,508 $ 21,300 $ 3,098
and Treasurer 1991 $100,121 $ 23,100 $ 2,879
Christopher L. Dutton.................... 1993 $103,268 $ 0 $ 3,351
Vice President and 1992 $ 98,481 $ 19,700 $ 2,796
General Counsel 1991 $ 92,583 $ 22,200 $ 2,617
Stephen C. Terry......................... 1993 $ 94,814 $ 0 $ 3,040
Vice President 1992 $ 91,092 $ 18,200 $ 2,598
External Relations 1991 $ 78,427 $ 15,200 $ 2,214
John V. Cleary(3)........................ 1993 $121,797 $ 0 $ 6,436
Retired President and Chief 1992 $235,656 $ 75,000 $ 10,340
Executive Officer 1991 $217,663 $ 66,500 $ 9,401
Thomas V. O'Connor, Jr. (4).............. 1993 $108,743 $ 0 $ 4,934
Retired Senior Vice President 1992 $121,873 $ 27,200 $ 4,781
1991 $102,081 $ 25,000 $ 3,986
- ---------------
<FN>
(1) Amounts shown include salary and incentive earned by the Executive Officers
on the basis of the Company's operating results in 1991, 1992 and 1993, as
well as amounts earned but deferred at the election of those officers.
(2) Mr. Hyde was elected by the Board of Directors as the Company's President
and Chief Executive Officer effective July 1, 1993.
(3) Mr. Cleary retired from the Company as President and Chief Executive Officer
effective July 1, 1993.
(4) Mr. O'Connor retired from the Company as Senior Vice President effective
November 1, 1993.
(5) The total amounts shown in this column for the last fiscal year consist of
the following:
(i) Benefits attributable to Company-owned life insurance policy: Mr.
Cleary $3,357, Mr. Hyde $1,355, Mr. Terreri $1,975, Mr. O'Connor $1,935,
Mr. Norse $490, Mr. Dutton $366, and Mr. Terry $538.
(ii) Company matching contributions to the Employee Savings and Investment
Plan: Mr. Cleary $3,079, Mr. Hyde $4,326, Mr. Terreri $3,232, Mr. O'Connor
$2,999, Mr. Norse $3,189, Mr. Dutton $2,985, and Mr. Terry $2,502.
</TABLE>
7
<PAGE> 12
MANAGEMENT INCENTIVE PLAN AWARDS FOR 1993 PERFORMANCE
The Compensation Committee of the Board of Directors has determined that
none of the Named Executive Officers will receive incentive awards on the basis
of 1993 operating results. See Compensation Committee Report.
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Board of Directors (the "Compensation
Committee") is charged with the responsibility of reviewing and making
recommendations to the Board of Directors regarding the annual salaries and
incentive awards paid to the Executive Officers of the Company. The process
involved in determining the executive compensation for fiscal 1993 is summarized
below.
- In March and April 1993, an independent compensation consultant compiled
information regarding executive compensation from a number of nationwide
surveys of similarly-sized utility companies and from surveys of other
businesses. The companies in such surveys operate in the Northeast United
States, or are of a similar size, or have other operating characteristics
similar to the Company. The Compensation Committee believes these
companies are representative of the Company's main competition for
executive talent. Consequently, the compensation survey groups are
different than the companies in the S&P Electric Companies Index and the
S&P 500 Composite Index used for the Performance Graphs.
- In April, the consultant provided a report to the Compensation Committee
recommending changes in salary ranges as well as salary increase
percentages reflecting meritorious job performance and cost of living
factors. The report discussed how marketplace data was used to prepare
the recommendations. Through regression analysis, with adjustments to
maintain internal equity, the market data was used to derive a salary
range midpoint, which was the average for each Executive Officer position
salary range. The recommended salary ranges were then established from
these midpoints.
- The competitive market data was reviewed with the Company's Chief
Executive Officer for each Executive Officer position except that of the
Chief Executive Officer. In addition, each position, except that of the
Chief Executive Officer, was reviewed together with each Executive
Officer's individual performance for 1992 and objectives for the year
1993. The Company's performance for 1992 and performance targets for 1993
were also reviewed.
- Based on the foregoing, the Chief Executive Officer recommended to the
Compensation Committee a base salary and incentive award for each
executive level position excluding the Chief Executive Officer. The
incentive is paid to the Executive Officer after the end of the fiscal
year only if both the Executive Officer and the Company have achieved
their performance objectives for that year.
- Incentives for Executive Officers are determined according to the
Company's Management Incentive Plan standards. Those standards are based
upon corporate and individual performance measures. The corporate
performance measures include factors that are deemed critical to the
Company's ability to attract capital needed to fund future operations and
investments and to remain a viable service provider, including the
Company's return on common equity. The individual performance measures
for the Executive Officers include such qualitative factors as value to
customers, customer service, efficiency (financial and non-financial) and
organizational effectiveness. The Company may make incentive payments to
Executive Officers only if the earned return on equity exceeds 85% of the
target return on equity set by the Vermont Public Service Board. The
incentive awards were based on a formula that permits maximum awards if
the target return on equity set by the Vermont Public Service Board is
achieved by the Company, and a pro rata reduction from the maximum if the
earned return on equity is less than the target return on equity but
greater than 85% thereof. Apart from the limits
8
<PAGE> 13
established by this formula, compensation awards were determined at the
discretion of the Compensation Committee.
- In May 1993, the Compensation Committee reviewed the consultant's
recommendations, performance evaluations and survey data. After
discussion, the Committee recommended a base salary which was approved by
the Board of Directors. In addition, the Compensation Committee approved
an incentive award for each Executive Officer except for the Chief
Executive Officer.
- The Compensation Committee reviewed the salary of the Chief Executive
Officer and compared it to salaries paid to chief executives of utility
companies of similar size and to other companies. In addition, the
Compensation Committee considered the corporate performance standards set
forth above relating to the other Executive Officers. After discussion,
the Compensation Committee recommended a base salary, which was approved
by the Board of Directors. In addition, the Compensation Committee
approved an incentive award for the Chief Executive Officer.
Specifically, the Compensation Committee considered, among other factors,
the following matters (in descending order of importance without any
specific weight being assigned to any of such factors) in establishing
the Chief Executive Officer's base salary and incentive award: the
Company's achievement in 1992 of the return on equity target set by the
Vermont Public Service Board; the Company's continuing to have the lowest
retail electricity rates among the major investor-owned utilities in New
England; the Company's maintenance in 1992 of its standing as having the
second highest credit rating among New England's investor-owned
utilities; and the continued favorable assessment of the Company by its
customers in 1992 as reflected in an independent professional survey.
These factors were also considered with respect to the Compensation
Committee's deliberations on the base salaries and incentive awards for
the other Executive Officers. The base salaries of the retired Chief
Executive Officer and his successor in 1993 were within the third and
second quartile, respectively, of the base salaries paid by the surveyed
companies.
- In May 1993, the Compensation Committee presented its report and
recommendations to the Board of Directors for approval.
- In March 1994, the Compensation Committee considered the Management
Incentive Plan awards to be made in 1994 to the Named Executive Officers
listed in the Summary Compensation Table in light of the Company's
performance in 1993. Because the Company's earned return on equity in
1993 did not materially exceed 85% of the target return, the Compensation
Committee concluded that no incentive awards should be made in 1994 to
the Named Executive Officers on the basis of the Company's performance in
1993.
- In April 1994, the Compensation Committee will consider the base salaries
that the Committee will recommend to be paid to the Named Executive
Officers as of May 1994. The recommendations of the Compensation
Committee to the Board of Directors in this respect will be based on a
new report by a compensation consultant, new market survey data, and the
Company's goals and objectives for 1994.
- A new Section 162(m) was added to the Internal Revenue Code when Congress
enacted the Omnibus Budget Reconciliation Act of 1993 on August 10, 1993.
The Company has reviewed its compensation policies with respect to
executive officers and determined that Section 162(m) should have no
impact on its executive compensation policies in 1994 because no
executive officer will receive compensation in such year in excess of the
$1 million threshold.
<TABLE>
COMPENSATION COMMITTEE
- -----------------------------------------------
<S> <C>
Robert E. Boardman Richard I. Fricke
William H. Bruett Euclid A. Irving
Merrill O. Burns,
Chairman Thomas P. Salmon
</TABLE>
9
<PAGE> 14
PERFORMANCE GRAPHS
The following graphs compare the total return on investment (change in
stock price plus reinvested dividends) performance of the Company with that of
the S&P 500 Composite Index and the S&P Electric Companies Index calculated by
Standard & Poor's Corporation. The S&P Electric Companies Index is comprised of
24 electric utility companies. The comparison of total return on investment for
each of the periods assumes $100 was invested on December 31, 1988 (for the
five-year graph) or December 31, 1983 (for the 10-year graph) in each of: the
Company, the S&P 500 Composite Index and the S&P Electric Companies Index. The
performances of the compared investments on a total return basis are quite
sensitive to the market price prevailing on the date when the periods that are
depicted on the graphs begin.
<TABLE>
FIVE-YEAR COMPARISON OF RETURN
ASSUMING QUARTERLY REINVESTMENT OF DIVIDENDS
<CAPTION>
MEASUREMENT PERIOD S&P ELECTRIC
(FISCAL YEAR COVERED) GMP S&P 500 COS
<S> <C> <C> <C>
1988 100.00 100.00 100.00
1989 123.66 131.69 133.17
1990 115.12 127.60 136.55
1991 166.46 166.47 177.89
1992 197.18 179.15 188.35
1993 196.28 197.21 212.09
</TABLE>
10
<PAGE> 15
<TABLE>
TEN-YEAR COMPARISON OF RETURN
ASSUMING QUARTERLY REINVESTMENT OF DIVIDENDS
<CAPTION>
MEASUREMENT PERIOD S&P ELECTRIC
(FISCAL YEAR COVERED) GMP S&P 500 COS
<S> <C> <C> <C>
1983 100.00 100.00 100.00
1984 121.20 106.22 127.09
1985 176.64 139.83 160.71
1986 254.12 165.86 206.74
1987 265.89 174.45 191.17
1988 251.36 203.43 224.69
1989 310.83 267.88 299.23
1990 289.37 259.57 307.05
1991 418.42 338.65 399.70
1992 495.63 364.45 423.22
1993 493.36 401.18 476.56
</TABLE>
11
<PAGE> 16
PENSION PLAN INFORMATION
The following table shows annual pension benefits payable pursuant to the
Company's Retirement Plan to all covered employees, including Executive
Officers, upon retirement at age 65, in various compensation and
years-of-service classifications, assuming the election of a retirement
allowance payable as a life annuity. The retirement benefits in connection with
the separate life insurance plan referred to below are in addition to those
described in the following table.
<TABLE>
PENSION PLAN TABLE
<CAPTION>
ANNUAL AVERAGE BASE
COMPENSATION IN 3 ESTIMATED ANNUAL RETIREMENT BENEFITS
CONSECUTIVE HIGHEST AT NORMAL RETIREMENT AGE OF 65 YEARS
PAID YEARS OUT OF LAST CREDITED YEARS OF SERVICE*
10 YEARS PRECEDING ---------------------------------------------------------
RETIREMENT 15 20 25 30 35 & OVER
- ---------------------- ------ ------ ------- ------- -----------
<S> <C> <C> <C> <C> <C>
$125,000 28,290 37,720 47,150 56,580 66,010
$150,000 34,290 45,720 57,150 68,580 80,010
$175,000 40,290 53,720 67,150 80,580 94,010
$200,000 46,290 61,720 77,150 92,580 108,010
$225,000 52,290 69,720 87,150 104,580 122,010
$250,000 58,290 77,720 97,150 116,580 136,010
$300,000 70,290 93,720 117,150 140,580 164,010
- ---------------
<FN>
* Credited years of service (including service credited with other companies),
as of December 31, 1993, for each of the following Executive Officers were as
follows: D. G. Hyde 15.9 years; A. N. Terreri 31.5 years; E. M. Norse 23.6
years; C. L. Dutton 8.8 years; and S. C. Terry 7.8 years. Credited years of
service (including service credited with other companies), as of the respective
dates of their retirement for J. V. Cleary were 35 years as of July 1, 1993, and
for T. V. O'Connor were 29.8 years as of November 1, 1993.
</TABLE>
All employees, including Executive Officers of the Company are covered by
the Company's Retirement Plan if they have been employed for more than a year.
This Plan is a defined benefit plan providing for normal retirement at age 65.
Early retirement may be taken commencing with the first of any month following
the attainment of age 55, provided at least five years of credited service have
been completed. For employees with at least 10 years of credited service, the
accrued benefits are reduced as follows if retirement occurs prior to age 62:
<TABLE>
<CAPTION>
AGE AT RETIREMENT REDUCTION OF BENEFITS
------------------------------------------------------
<S> <C>
61 5%
60 10%
59 15%
58 20%
57 25%
56 32%
55 37%
</TABLE>
For employees with less than 10 years of credited service who retire before
age 65, benefits are actuarially reduced. If retirement occurs after age 62 and
completion of at least 10 years of credited service, the full accrued benefit is
payable. Retirement benefits are not subject to any deductions for Social
Security or other offset amounts.
12
<PAGE> 17
Retirement benefits are based on final average base compensation and length
of service. Final average compensation is the average of the compensation
(limited to base salary for Executive Officers, which is shown in the Salary
column of the Summary Compensation Table for the Named Executive Officers, and
straight-time payroll wages for other employees) for the three highest
consecutive years out of the final 10 years of employment. Effective January 1,
1989, the normal retirement benefit is equal to 1.1% of the final average
compensation up to covered compensation plus 1.6% of final average compensation
over covered compensation multiplied by each year of credited service up to 35
years.
For 1993, the percentage which the cost to maintain the retirement fund
bore to the total participant covered compensation equaled 4.8%.
Executive Officers of the Company, including the Named Executive Officers,
participate in a separate life insurance plan. Under this separate plan, the
Company has purchased life insurance on the lives of the Executive Officers to
provide life insurance benefits to them in an amount equal to four times salary
for the most senior Executive Officer (President and Chief Executive Officer),
three times salary for the next most senior Executive Officers (Senior Vice
President and Chief Operating Officer, Vice Presidents and General Counsel) and
two times salary for the third most senior Executive Officers (Assistant Vice
Presidents, Assistant General Counsel, Assistant Treasurer and Controller). The
plan also provides retirement and survivor's benefits for a period of fifteen
years following retirement as a supplement to the Company's Retirement Plan in
an amount equal to 44% of final salary for the most senior Executive Officer,
33% of final salary for the next most senior Executive Officers and 22% of final
salary for the third most senior Executive Officers. Retirement benefits will be
paid out of the Company's general assets. This plan was designed so that if the
compensation, financial, tax and investment assumptions employed in establishing
the plan are realized, the Company would not incur any significant net expense
in implementing this plan. The Company will incur additional costs for this plan
if those assumptions are not realized. These costs cannot be properly allocated
or determined for any one plan participant because of the overall plan
assumptions. The Company is recording the estimated cost of this plan on a
current basis and will record as income life insurance benefits when they occur.
The Company has adopted a Deferred Compensation Plan pursuant to which
Executive Officers may elect to defer a portion of their salaries. Amounts
deferred are credited to a separate account for each participant. The balance in
an Executive Officer's account will be paid to him or her or his or her
beneficiary over a period of years after he or she retires.
Certain of the Company's officers, including the Named Executive Officers,
and other key management personnel may be designated to participate in the
Company's Management Incentive Plan, adopted in December 1985 and amended in
December 1990. For each calendar year, corporate performance standards,
including the Company's return on common equity and individual job performances,
are evaluated, and the degree to which those standards are achieved determines
the amount to be allocated to participants as incentive compensation. Annual
awards may amount to a maximum of 10% to 30% of a participant's salary depending
on such participant's position. Distributions to participants may be made in
three annual installments, depending on the amount of the award. Payments made
in the last three years under the Management Incentive Plan, based on the
Company's and the participants' performance in those years, are set forth in the
Incentive column of the Summary Compensation Table.
The Company has entered into severance contracts with 14 of its Executive
Officers, including the Named Executive Officers, under which the Company has
certain obligations to each affected Executive Officer if there is a change in
control of the Company (as defined below), and if the Executive Officer's
employment is involuntarily terminated without cause or is voluntarily
terminated by the Executive Officer with good reason (as defined below) within
two years after such change in control. The severance contracts
13
<PAGE> 18
provide for payments of 2.99 times the base salaries of the affected Executive
Officers, for continuation of health, medical and other insurance programs for
such Executive Officers for twenty-four months after the termination of
employment of such Executive Officers following a "change in control" of the
Company and for payment of an amount equal to the actuarial value of up to
twenty-four additional months of credited service under the Company's Retirement
Plan after such termination. A "change in control of the Company" will be deemed
to have occurred under the severance contracts when a person secures the
beneficial ownership of 25% or more of the voting power of the Company's then
outstanding securities, when there has been a new majority of members serving on
the Board of Directors for two consecutive years or when the Company's
shareholders approve a merger or consolidation of the Company with another
corporation where the outstanding voting securities of the Company do not
continue to represent at least 80% of the combined voting power of the Company
or the surviving entity. Under the severance contracts, the Board of Directors
has limited discretion to determine whether a change of control of the Company
has, in fact, taken place. An Executive Officer may terminate his or her
employment "with good reason" following a change in control if the Executive
Officer is assigned duties inconsistent with his or her responsibilities before
the change in control occurred, if the Company's headquarters are relocated more
than 50 miles from the present location, if the Executive Officer is required to
relocate more than 50 miles from his or her present location, if the Executive
Officer's compensation or benefits are reduced or adversely affected (other than
as part of an overall adjustment of executive compensation or benefits) or if
the Company does not obtain an agreement from its successor to perform under the
severance contracts.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors on December 8, 1993, appointed the firm of Arthur
Andersen & Co. to serve as independent certified public accountants for the
calendar year 1994. The appointment was made upon the recommendation of the
Audit Committee. Arthur Andersen & Co. has served the Company in this capacity
continuously since 1988. Representatives of the firm are expected to attend the
Annual Meeting to make statements if they desire and to respond to appropriate
questions.
COMPLIANCE WITH THE SECURITIES EXCHANGE ACT
The Company's Directors and Executive Officers are required under Section
16(a) of the Securities Exchange Act of 1934 to file reports of ownership and
reports of changes in ownership with the Securities and Exchange Commission and
the New York Stock Exchange. Copies of those reports must also be furnished to
the Company.
Based solely on a review of those reports and written representations from
the Directors and Executive Officers, the Company believes that during 1993 all
requirements applicable to Directors and Executive Officers have been complied
with except that one transaction was not timely reported. Glenn J. Purcell,
Controller of the Company, inadvertently failed to file a report on Form 4 in
May 1993 reporting the sale of 100 shares of Common Stock. However, a Form 4 was
filed on July 16, 1993, reporting the transaction.
1995 SHAREHOLDER PROPOSALS
A shareholder proposal must be received by the Secretary of the Company no
later than December 16, 1994, to be included in the proxy materials for the
Company's next Annual Meeting.
14
<PAGE> 19
DISCRETIONARY AUTHORITY
While the Notice of Annual Meeting of Shareholders refers to such other
matters as may properly come before the Meeting, the only matters which the
Management intends to present or knows will be presented at the Meeting are
those matters set forth in the Notice of the Meeting. However, the enclosed
proxy gives discretionary authority to the persons named therein to act in
accordance with their best judgment in the event any additional matters should
be presented at the Meeting.
By Order of the Board of Directors
DONNA S. LAFFAN
Secretary
South Burlington, Vermont
April 15, 1994
15
<PAGE> 20
<TABLE>
<CAPTION>
THIS PROXY WILL BE VOTED AS DIRECTED OR , IN THE ABSENCE OF SPECIFIC DIRECTIONS, FOR ITEM 1. / X / PLEASE MARK
YOUR VOTES
AS THIS
_____________ ______________________________
COMMON DIVIDEND REINVESTMENT SHARES
<S> <C> <C> <C>
Item 1 - Election of the following nominees as Directors: Item 2 - In their discretion, the Proxies are
Robert E. Boardman, Nordahl L. Brue, William H. Bruett, authorized to vote upon such other matters as may
Merrill O. Burns, Lorraine E. Chickering, John V. Cleary, properly come before the meeting.
Richard I. Fricke, Douglas G. Hyde, Euclid A. Irving FOR all Withheld
Martin L. Johnson, Ruth W. Page, Thomas P. Salmon nominees for all
/ / / /
Withheld for the following nominee(s) only; print name(s)
________________________________________________________
________________________________________________________
<CAPTION>
Signature(s) __________________________________________________________________ Date _____________________
NOTE: Please sign as name appears hereon. Joint owners should each sign. When signing as attorney, executor, adminstrator
trustee or guardian, please give fill title as such.
____________________________________________________________________________________________________________________________________
</TABLE>
PROXY
GREEN MOUNTAIN POWER CORPORATION
25 GREEN MOUNTAIN DRIVE
SOUTH BURLINGTON, VERMONT
The undersigned hereby appoints Douglas G. Hyde, A. Norman
Terreri and Christopher L. Dutton as Proxies, each with the power to
appoint his substitute, and hereby authorizes them to represent and to
vote, as designated on the reverse side, all the shares of Common Stock
of Green Mountain Power Corporation held of record by the undersigned on
April 8, 1994, at the Annual Meeting of Shareholders to be held on May
19, 1994, or any adjournment thereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
(PLEASE DATE AND SIGN ON REVERSE SIDE)
<PAGE> 21
<TABLE>
<S> <C> <C> <C>
THE TRUSTEE WILL VOTE AS DIRECTED OR, IN THE ABSENCE CONFIDENTIAL VOTING INSTRUCTIONS TO
OF SPECIFIC DIRECTIONS, FOR ITEM 1. CHITTENDEN CORPORATION
GREEN MOUNTAIN POWER CORPORATION AS TRUSTEE UNDER THE GREEN MOUNTAIN POWER
ESIP CORPORATION ESIP PLAN
I hereby direct that the voting rights pertaining to
shares of stock of Green Mountain Power Corporation
held by the Trustee and allocated to my account
shall be exercised at the Annual Meeting of Share-
holders of Green Mountain Power Corporation, to be
FOR all Withheld held on May 19, 1994, and all adjournments thereof.
nominees for all
Item 1 - Election of the following nominees as Directors: / / / / Item 2 - In their discretion, the Proxies are
Robert E. Boardman, Nordahl L. Brue, William H. Bruett, authorized to vote upon such other matters as may
Merrill O. Burns, Lorraine E. Chickering, John V. Cleary, properly come before the meeting.
Richard I. Fricke, Douglas G. Hyde, Euclid A. Irving
Martin L. Johnson, Ruth W. Page, Thomas P. Salmon
Withheld for the following nominee(s) only; print name(s)
________________________________________________________
________________________________________________________
_______________________________________
Date
_______________________________________
Signature of Participant
____________________________________________________________________________________________________________________________________
</TABLE>
