<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [_]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
[X] Definitive Proxy Statement RULE 14C-5(D)(2))
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
Northeast Utilities
------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
Theresa H. Allsop
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[_] $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 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[_] Fee paid previously with preliminary materials.
[_] 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:
Notes:
<PAGE>
[LOGO OF NORTHEAST UTILITIES APPEARS HERE]
--------------------------------------------------------------------
1995 ANNUAL MEETING OF SHAREHOLDERS
--------------------------------------------------------------------
Dear Shareholder:
It is my pleasure to invite you to attend the 1995 Annual Meeting of Share-
holders of Northeast Utilities. The meeting will be held on Tuesday, May 23,
1995, at 10:00 a.m., at the Clarion Somerset Hotel, Nashua, New Hampshire,
which is located at Exit 8 off Route 3 (directions are on reverse side).
Information concerning the matters to be acted upon at the meeting is pro-
vided in the accompanying Notice of Annual Meeting and Proxy Statement. In ad-
dition, our meeting agenda will include a discussion of the operations of
Northeast Utilities system companies and a question and answer period.
Whether or not you plan to attend the meeting, it is important that you com-
plete, date, sign and return your proxy in the enclosed envelope as soon as
possible. This will ensure that your shares will be represented at the meeting
in accordance with your wishes.
Very truly yours,
/s/ William B. Ellis
William B. Ellis
Chairman of the Board
April 3, 1995
<PAGE>
THE CLARION SOMERSET HOTEL
2 SOMERSET PARKWAY
NASHUA, NEW HAMPSHIRE 03063
FROM HARTFORD:
Take Interstate 84 (I-84) east to Sturbridge, Massachusetts and the Massa-
chusetts Turnpike. Take the turnpike east 10 miles to exit 10, Interstate 290
(I-290). Take I-290 east through Worcester, Massachusetts to Interstate 495
(I-495). Take I-495 north to Route 3 (Everett Turnpike) in Lowell, Massachu-
setts and travel north for approximately 30 minutes. Take exit 8, 101-A, Am-
herst. At the second set of lights, take a left. The hotel is on the left side
of the road. (Approximately 2 1/2 hours from Hartford).
FROM NEW YORK CITY:
Take Interstate 95 (I-95) north to New Haven, Connecticut. In New Haven,
exit onto Interstate 91 (I-91) north. Follow I-91 to Hartford and then take
exit 29 (North Routes 5 and 15 to I-84 east) onto I-84 east. Once on I-84,
follow directions from Hartford, above. (Approximately 5 hours from New York
City).
FROM MAINE:
Take I-95 south to Route 101 west. Follow 101 west to Interstate 293 (I-293)
to Route 3 (Everett Turnpike) south, to exit 8, 101-A, Amherst. At the second
set of lights, take a left. The hotel is on the left side of the road. (Ap-
proximately 2 hours from Portland, Maine).
FROM BURLINGTON, VERMONT AND NORTH POINTS:
Take Interstate 89 to Interstate 93 south to the Hooksett toll booth. Take a
left at fork and continue south on I-293 to Route 3 (Everett Turnpike) south,
to exit 8, 101-A, Amherst. At the second set of lights, take a left. The hotel
is on the left. (Approximately 3 1/2 hours from Burlington).
FROM ALBANY, NEW YORK AND BRATTLEBORO, VERMONT:
Take Route 9 east to Route 101, Keene, New Hampshire. Follow Route 101 east
approximately 1 hour to Route 101-A east (Milford). Take 101-A into Nashua,
watch for the Ground Round Restaurant on the left. Stay in left-hand lane and
take the next left onto Somerset Parkway. The hotel is on the right. (Approxi-
mately 3 hours from Albany).
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 23, 1995
To the Shareholders of Northeast Utilities:
The Annual Meeting of Shareholders of Northeast Utilities will be held on
Tuesday, May 23, 1995, at 10:00 a.m., at the Clarion Somerset Hotel, Nashua,
New Hampshire, which is located at Exit 8 off Route 3, for the following pur-
poses:
1. To fix the number of Trustees at thirteen;
2. To elect thirteen Trustees for the ensuing year;
3. To ratify the selection of Arthur Andersen LLP as independent auditors
for 1995; and
4. To transact any other business that may properly come before the meeting
or any adjournment thereof.
Only shareholders of record at the close of business on March 24, 1995 are
entitled to receive notice of and to vote at the meeting or any adjournment
thereof.
You are cordially invited to be present at the meeting and to vote. Whether
or not you plan to attend the meeting, please complete, date and sign the en-
closed proxy and return it in the envelope enclosed for that purpose.
By order of the Board of Trustees,
/s/ Robert P. Wax
107 Selden Street Robert P. Wax
Berlin, Connecticut Secretary
Mailing Address:
Post Office Box 270
Hartford, Connecticut 06141-0270
April 3, 1995
-------------------------------------------------------------------------------
IMPORTANT
SHAREHOLDERS CAN HELP AVOID THE NECESSITY AND EXPENSE OF FOLLOW-UP LETTERS
TO ENSURE THAT A QUORUM IS PRESENT AT THE ANNUAL MEETING BY PROMPTLY RETURNING
THE ENCLOSED PROXY. THE ENCLOSED ENVELOPE REQUIRES NO POSTAGE, IF MAILED IN
THE UNITED STATES.
-------------------------------------------------------------------------------
<PAGE>
PROXY STATEMENT
1. NUMBER OF TRUSTEES
2. ELECTION OF TRUSTEES
The accompanying proxy is solicited on behalf of the Board of Trustees of
Northeast Utilities for use at the Annual Meeting of Shareholders to be held
on May 23, 1995, and at any adjournment thereof.
Please read this proxy statement and fill in, date, sign and return the en-
closed form of proxy. The proxy may be revoked at any time before it is voted
by filing a letter with the Secretary of Northeast Utilities or by a duly exe-
cuted proxy bearing a later date. Properly executed proxies not revoked will
be voted according to their terms.
Only holders of common shares of record at the close of business on March 24,
1995 (the record date) are entitled to receive notice of and to vote at the
meeting or any adjournment thereof. On that date, there were 134,210,441 com-
mon shares outstanding. Each such share is entitled to one vote on each matter
to be voted on at the Annual Meeting of Shareholders.
The principal office of Northeast Utilities is located at 174 Brush Hill Ave-
nue, West Springfield, Massachusetts. The general office of Northeast Utili-
ties and its subsidiaries is located at 107 Selden Street, Berlin, Connecticut
(mailing address: Post Office Box 270, Hartford, Connecticut 06141-0270). This
proxy statement and the accompanying form of proxy are being mailed to share-
holders commencing April 3, 1995.
An affirmative vote of a majority of the common shares outstanding as of the
record date will be required to fix the number of Trustees at thirteen and to
elect the thirteen nominees named below.
Unless a shareholder specifies otherwise, the enclosed proxy will be voted to
fix the number of Trustees for the ensuing year at thirteen and to elect the
thirteen nominees named below as Trustees to serve until the next Annual Meet-
ing and until their successors have been elected and shall have qualified. In
accordance with the Board's retirement policy for Trustees, Mr. Donald J. Don-
ahue and Mr. Eugene D. Jones, who have served as Trustees since 1983 and 1973,
respectively, are not nominees for re-election. The nominees who have not been
previously elected as Trustees by the shareholders are Messrs. Alfred F.
Boschulte and John F. Turner.
If one or more of the nominees should become unavailable for election, the
proxy may be voted for a substitute person or persons. However, there is no
reason to anticipate that any of the nominees will not be available.
Set forth below is each nominee's name, age, date first elected as a Trustee,
and a brief summary of the nominee's business experience during the past five
years.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE TO FIX THE NUMBER OF
TRUSTEES AT THIRTEEN AND FOR ELECTION OF THE THIRTEEN NOMINEES LISTED BELOW.
[PHOTO OF ALFRED F. BOSCHULTE
ALFRED F. (52 YEARS)
BOSCHULTE President of TOMCOM L.P., Orangeburg, New York (a joint serv-
APPEARS ices organization of the wireless communications partnership
HERE] formed by AirTouch Communications, Bell Atlantic, NYNEX and US
West). Previously President and Chairman of NYNEX Mobile Com-
munications. Mr. Boschulte is Chairman of the Board of
MobiLink, Chairman of the Cellular Foundation of the Cellular
Telecommunications Industry Association (CTIA) and a member of
the CTIA Board of Directors. He is a member of the Boards of
INROADS Fairfield-Westchester Counties, Inc. and Westchester
Council of Arts, and a member of the Institute of Electrical
and Electronic Engineers. He is a Trustee of the National
Board of the Boys & Girls Clubs of America and a member of the
Board of Trustees of the State University of New York at Pur-
chase.
<PAGE>
[PHOTO OF COTTON MATHER CLEVELAND
COTTON (42 YEARS) 1992
MATHER President of Mather Associates, New London, New Hampshire (a
CLEVELAND firm specializing in human resources and organizational devel-
APPEARS HERE] opment). Ms. Cleveland is also Executive Director of Leadership
New Hampshire. She is a Director of Bank of Ireland First Hold-
ings, First NH Banks, Inc. and the National Grange Mutual In-
surance Company. She was formerly Co-Chair of the Governor's
Commission on New Hampshire in the 21st Century. Ms. Cleveland
has served on the University System of New Hampshire Board of
Trustees as Chair, Vice Chair and member. She was also an In-
corporator for the New Hampshire Charitable Foundation and is
currently an Incorporator for The Montshire Museum and for the
Upper Valley Community Foundation.
[PHOTO OF GEORGE DAVID
GEORGE (52 YEARS) 1990
DAVID President and Chief Executive Officer and a Director of United
APPEARS HERE] Technologies Corporation, Hartford, Connecticut (provides a
range of products, systems and services to aerospace and de-
fense, construction and automotive industries). Previously
President and Chief Operating Officer of United Technologies
Corporation. Mr. David is a Trustee of the Graduate School of
Business Administration at the University of Virginia and of
Hartford's Wadsworth Atheneum.
[PHOTO OF WILLIAM B. ELLIS
WILLIAM B. (54 YEARS) 1977
ELLIS Chairman of the Board of Northeast Utilities and Chairman and a
APPEARS HERE] Director of its principal subsidiaries and Emeritus Director of
Connecticut Yankee Atomic Power Company. Previously Chairman of
the Board and Chief Executive Officer of Northeast Utilities
and Chairman, Chief Executive Officer and a Director of its
principal subsidiaries and of Connecticut Yankee Atomic Power
Company. He is a Director of Nuclear Electric Insurance Limit-
ed, Connecticut Mutual Life Insurance Company, The Hartford
Steam Boiler Inspection and Insurance Company, Radian Corpora-
tion (a subsidiary of Hartford Steam Boiler) and the Greater
Hartford Chamber of Commerce. Mr. Ellis is a member of the Uni-
versity of Hartford's Board of Regents, the Board of The Na-
tional Museum of Natural History of The Smithsonian Institution
and the Science Advisory Board of The Nature Conservancy. He is
Chairman of the Board of the Connecticut Capitol Region Growth
Council, Inc.
[PHOTO OF BERNARD M. FOX
BERNARD M. (52 YEARS) 1986
FOX APPEARS President and Chief Executive Officer of Northeast Utilities
HERE] and an officer and a Director of its principal subsidiaries and
President and Chief Executive Officer and a Director of Con-
necticut Yankee Atomic Power Company. Previously President and
Chief Operating Officer of Northeast Utilities and of its prin-
cipal subsidiary companies and of Connecticut Yankee Atomic
Power Company. He is a Director of Shawmut National Corp., The
Dexter Corporation, the Connecticut Business and Industry Asso-
ciation, the Institute of Nuclear Power Operations, CIGNA Cor-
poration, The Institute of Living, Hartford Hospital and Mount
Holyoke College. Mr. Fox is a Fellow and Founder of the Ameri-
can Leadership Forum, and a senior member of the Institute of
Electrical and Electronic Engineers.
2
<PAGE>
[PHOTO OF GAYNOR N. KELLEY
GAYNOR N. (64 YEARS) 1994
KELLEY Chairman and Chief Executive Officer of The Perkin-Elmer Cor-
APPEARS HERE] poration, Norwalk, Connecticut (manufactures, develops and
distributes analytical instruments and life science systems
that are used in a variety of markets). Previously President
and Chief Operating Officer of The Perkin-Elmer Corporation.
Mr. Kelley is a member of the Boards of Directors of Hercules
Incorporated and Clark Equipment Company. He is Chairman of
the Southwestern Area (Connecticut) Commerce and Industry As-
sociation and Vice Chairman of the Connecticut Business and
Industry Association.
[PHOTO OF ELIZABETH T. KENNAN
ELIZABETH T. (57 YEARS) 1980
KENNAN President of Mount Holyoke College, South Hadley, Massachu-
APPEARS HERE] setts, and President of Five Colleges, Incorporated. Mrs.
Kennan is a Director of Kentucky Home Mutual Insurance, Ken-
tucky Home Mutual Life Insurance Company, NYNEX Corporation,
The Putnam Funds and Talbots. She is a member of the Folger
Shakespeare Library Committee and a Director of the Council on
Library Resources.
[PHOTO OF DENHAM C. LUNT, JR.
DENHAM C. (69 YEARS) 1973
LUNT, JR. Chairman and a Director of Lunt Silversmiths, Greenfield, Mas-
APPEARS HERE] sachusetts, and a Director of Lamson and Goodnow Manufacturing
Company and Heritage Cutlery, Inc., both subsidiaries of Lunt
Silversmiths. Mr. Lunt is a Director of Berkshire Life Insur-
ance Company.
[PHOTO OF WILLIAM J. PAPE II
WILLIAM J. (63 YEARS) 1974
PAPE II Publisher, Waterbury Republican-American, Waterbury, Connecti-
APPEARS HERE] cut (newspaper). Mr. Pape is President and Treasurer of Ameri-
can-Republican, Inc. He is a Director of Platt Bros. & Co.,
Paper Delivery, Inc. and Greater Waterbury Health Network,
Inc. He is a Trustee of Teikyo Post University, the Connecti-
cut Policy and Economic Council, Inc. and the Waterbury
Y.M.C.A.
[PHOTO OF ROBERT E. PATRICELLI
ROBERT E. (55 YEARS) 1993
PATRICELLI Founder, Chairman and Chief Executive Officer of Value Health,
APPEARS HERE] Inc., Avon, Connecticut (provides managed health care servic-
es). Previously Executive Vice President of CIGNA Corporation
and President of CIGNA's Affiliated Businesses Group. Mr.
Patricelli has held various positions in the federal govern-
ment, including White House Fellow in 1965, counsel to a
United States Senate Subcommittee, Deputy Undersecretary of
the Department of Health, Education and Welfare, and Adminis-
trator of the United States Urban Mass Transportation Adminis-
tration. He is a member of the Boards of the United States
Chamber of Commerce, Hartford Hospital, The Institute of Liv-
ing and Wesleyan University.
3
<PAGE>
[PHOTO OF NORMAN C. RASMUSSEN
NORMAN C. (67 YEARS) 1977
RASMUSSEN Professor of Nuclear Engineering, Emeritus, Massachusetts In-
APPEARS HERE] stitute of Technology, Cambridge, Massachusetts. Dr. Rasmussen
is Chairman of the M.I.T. Reactor Safeguards Committee. From
1972 through 1975 he directed the Reactor Safety Study for the
Atomic Energy Commission. He served on President Ford's Advi-
sory Committee on Technology and Economic Strength and was ap-
pointed by President Reagan to the National Science Board, on
which he served from 1982 through 1988. He served on the Sci-
entific Advisory Board for the Three Mile Island Unit 2 Clean-
Up Fund, and served as Chairman of the Cabot Corporation LNG
Safety Committee for 20 years. He is a Fellow of the American
Nuclear Society and the Health Physics Society and a member of
the National Academy of Engineering and the National Academy
of Science. In 1989, Dr. Rasmussen was appointed to the Presi-
dential Commission on Catastrophic Nuclear Accidents. He is a
licensed Professional Engineer in Massachusetts.
[PHOTO OF JOHN F. SWOPE
JOHN F. SWOPE (56 YEARS) 1992
APPEARS HERE] Of counsel to the law firm of Sheehan, Phinney, Bass & Green,
Manchester, New Hampshire. Previously President of Chubb Life
Insurance Company of America (retired December, 1994), Con-
cord, New Hampshire. Mr. Swope is Senior Advisor to The Chubb
Corporation on healthcare issues. He is a Director of the Pub-
lic Broadcasting Service and New Hampshire Public Television
and the New Hampshire Business Committee for the Arts. Mr.
Swope is Vice Chairman of The Currier Gallery of Art and a
Trustee of Tabor Academy and the Capitol Center for The Arts.
[PHOTO OF JOHN F. TURNER
JOHN F. (52 YEARS)
TURNER President and Chief Operating Officer of The Conservation
APPEARS HERE] Fund, Arlington, Virginia (a national nonprofit organization
dedicated to conservation and economic development). From 1989
to 1993, Mr. Turner was Director of the United States Fish &
Wildlife Service in the United States Department of Interior.
He has also served as President of the Wyoming State Senate.
Mr. Turner is consulting with The University of Wyoming on the
establishment of a School of the Environment and Natural Re-
sources and is also a member of the University's College of
Engineering Steering Committee. He is a member of the Board of
Governors of the School of Natural Resources and the Environ-
ment at the University of Michigan and the Board of Directors
of Land Trust Alliance.
4
<PAGE>
COMMITTEE COMPOSITION AND RESPONSIBILITY
The Board of Trustees of Northeast Utilities has Audit, Executive, Finance
and Corporate Responsibility Committees and a Committee on Organization, Com-
pensation and Board Affairs. Following each meeting, the Committees report to
the Board. The Board of Trustees does not have a Nominating Committee.
The Audit Committee meets independently with the internal and independent au-
ditors of Northeast Utilities and its subsidiaries to review the auditors' ac-
tivities, procedures and recommendations. The Committee recommends annually
the appointment of Northeast Utilities' independent auditors for the coming
year. The Audit Committee met three times in 1994. The members of the Commit-
tee are Messrs. Donahue (Chairman), David, Jones, Pape, Patricelli, Rasmussen
and Swope, none of whom is an employee of Northeast Utilities or its subsidi-
aries.
The Executive Committee is empowered to exercise all the authority of the
Board, subject to certain limitations set forth in Northeast Utilities' Decla-
ration of Trust, during the intervals between meetings of the Board. The Com-
mittee met four times in 1994. The members of the Committee are Messrs. Ellis
(Chairman), Donahue, Fox, Jones, Lunt, Pape and Swope and Mrs. Kennan. Other
than Messrs. Ellis and Fox, no committee member is an employee of Northeast
Utilities or its subsidiaries.
The Finance Committee reviews and makes recommendations as to financial mat-
ters that may affect Northeast Utilities and its subsidiaries. The Committee
met twice in 1994. The members of the Committee are Messrs. Ellis (Chairman),
Donahue, Fox, Lunt, Kelley, Rasmussen and Swope and Ms. Cleveland. Other than
Messrs. Ellis and Fox, no committee member is an employee of Northeast Utili-
ties or its subsidiaries.
The Corporate Responsibility Committee reviews the policies and practices of
Northeast Utilities and its subsidiaries that have broad social or community
significance. The Committee met four times in 1994. The members of the Commit-
tee are Messrs. Rasmussen (Chairman), Kelley, Pape and Patricelli and Mmes.
Cleveland and Kennan, none of whom is an employee of Northeast Utilities or
its subsidiaries.
The Committee on Organization, Compensation and Board Affairs reviews and ad-
justs, as appropriate, the compensation policies of Northeast Utilities and
its subsidiaries. The Committee is also responsible for reviewing policies af-
fecting the organization of Northeast Utilities and its subsidiaries. The Com-
mittee on Organization, Compensation and Board Affairs met three times in
1994. The members of the Committee are Messrs. Jones (Chairman), David, Lunt,
Pape, Patricelli and Rasmussen and Mmes. Cleveland and Kennan, none of whom is
an employee of Northeast Utilities or its subsidiaries. A report from this
Committee with respect to executive compensation is included in this proxy
statement.
In 1994, the Board of Trustees held 10 meetings. Committees of the Board held
a total of 16 meetings. All members of the Board of Trustees, except Mr. Da-
vid, attended 75 percent or more of the aggregate number of meetings of the
Board and the committees of which they were members. While Trustees make every
effort to attend meetings of the Board and committees of the Board of which
they are members, there are instances when, for compelling reasons, they are
unable to attend those meetings. The Board of Trustees believes that atten-
dance percentage information is not of itself a meaningful indicator of the
quality or importance of a Trustee's contribution to the Board.
5
<PAGE>
COMMON STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
COMMON STOCK OWNERSHIP OF MANAGEMENT
The following table provides information with respect to persons who are
known to Northeast Utilities to beneficially own more than five percent of the
common shares of Northeast Utilities. Northeast Utilities has no other class
of voting securities.
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE OF PERCENT OF
OF BENEFICIAL OWNERS BENEFICIAL OWNERSHIP CLASS
-------------------- -------------------- ----------
<S> <C> <C>
Mellon Bank Corporation 15,943,680(1) 11.88%
and Subsidiaries
One Mellon Bank Center
Pittsburgh, PA
Bankers Trust New York Corporation and 7,876,082(2) 5.87%
Subsidiaries
280 Park Avenue
New York, NY
</TABLE>
-------
(1) According to an amendment to Schedule 13G dated February 2, 1995, Mellon
Bank Corporation and its subsidiaries hold 15,943,680 common shares of
Northeast Utilities. According to the Schedule 13G, 14,146,663 of these
shares are held by Mellon Bank, N.A., a subsidiary of Mellon Bank Corpora-
tion, in its capacity as trustee under the Northeast Utilities Service
Company Supplemental Retirement and Savings Plan (the 401(k) Plan). Par-
ticipating employees may direct the trustee as to voting of shares allo-
cated to their 401(k) Plan accounts. Shares that have not been allocated
to plan participants' accounts are voted by the trustee in the same pro-
portion as it votes all the plan's shares for which directions are re-
ceived. The power to dispose of such shares is restricted by the provi-
sions of the 401(k) Plan. Mellon Bank, N.A. has informed Northeast Utili-
ties that it disclaims beneficial ownership of all shares held by it as
the 401(k) Plan trustee that have been allocated to plan participants' ac-
counts and for which directions have been received and followed.
According to the Schedule 13G, 1,797,017 shares are held by Mellon Bank Cor-
poration and Mellon Bank, N.A. in various fiduciary capacities. Mellon Bank
Corporation and its subsidiaries have sole voting power for 1,650,000
shares, shared voting power for 64,000 shares, sole dispositive power for
1,666,000 shares and shared dispositive power for 131,000 shares.
(2) According to a Schedule 13G dated February 15, 1995, Bankers Trust New
York Corporation and its subsidiaries hold 7,876,082 common shares of
Northeast Utilities. According to the Schedule 13G, 7,080,122 shares are
held with sole voting power, 3,262 shares are held with shared voting pow-
er, 7,872,820 shares are held with sole dispositive power, and 3,262
shares are held with shared dispositive power.
The common stock ownership table on page 7 provides information as of Febru-
ary 28, 1995, as to the beneficial ownership of the common shares of Northeast
Utilities, for each nominee for Trustee, each of the five highest paid execu-
tive officers of Northeast Utilities and its subsidiaries, and all Trustees
and executive officers as a group. Unless otherwise noted, each nominee and
executive officer has sole voting and investment power with respect to the
listed shares. The numbers in parentheses reflect that portion of the benefi-
cially owned shares shown for each Trustee receipt of which has been deferred
to a later date and as to which the Trustee has no current voting or invest-
ment power except as provided in the Northeast Utilities Deferred Compensation
Plan for Trustees (see "Compensation of Trustees" on page 7).
6
<PAGE>
<TABLE>
<CAPTION>
NAME OF BENEFICIAL AMOUNT AND NATURE OF PERCENT
OWNER BENEFICIAL OWNERSHIP OF CLASS (1)
------------------ -------------------- ------------
<S> <C> <C>
Alfred F. Boschulte 120
Robert E. Busch 7,301
Cotton Mather Cleveland (2) 1,673(295)
George David 878
William B. Ellis (3) 10,360
Bernard M. Fox (4) 19,911
Gaynor N. Kelley 504(295)
Elizabeth T. Kennan 1,423(99)
Denham C. Lunt, Jr. (5) 2,786(295)
Hugh C. MacKenzie (6) 5,902
John F. Opeka (7) 18,271
William J. Pape II 1,977(159)
Robert E. Patricelli 1,418
Norman C. Rasmussen 1,320
John F. Swope 1,320
John F. Turner 100
All Trustees and executive officers
as a group
(19 persons) 81,078(1,143)
</TABLE>
-------
(1) As of February 28, 1995, the nominees for Trustee and the executive offi-
cers of Northeast Utilities and its subsidiaries, as a group, beneficially
owned less than one percent of the common shares outstanding.
(2) 1,157 of these shares are held in a trust.
(3) Mr. Ellis shares voting and investment power with his wife for 1,208
shares.
(4) Mr. Fox shares voting and investment power with his wife for 3,031 of
these shares. In addition, Mr. Fox's wife has sole voting and investment
power for 140 shares as to which Mr. Fox disclaims beneficial ownership.
(5) Mr. Lunt shares voting and investment power for 2,271 shares with a bank-
ing institution under an indenture.
(6) Mr. MacKenzie shares voting and investment power with his wife for 1,361
shares.
(7) Mr. Opeka shares voting and investment power with his wife for 1,718
shares.
COMPENSATION OF TRUSTEES
During 1994, each Trustee who was not an employee of Northeast Utilities or
its subsidiaries was compensated at an annual rate of $17,000 cash plus 100
common shares of Northeast Utilities, and received $900 for each meeting of
the Board or its committees attended. Each of the Chairmen of the Audit Com-
mittee, the Corporate Responsibility Committee and the Committee on Organiza-
tion, Compensation and Board Affairs were compensated during 1994 at an addi-
tional annual rate of $3,000. Pursuant to the Northeast Utilities Deferred
Compensation Plan for Trustees, established by the Board in 1980, Ms. Cleve-
land elected to defer all cash payments for her 1994 service as a Trustee un-
til termination of her service as a Trustee, at which time she will receive
her deferred compensation in five annual installments.
In December, 1994, the Board of Trustees approved changes to the Deferred
Compensation Plan, and each non-employee Trustee was given the option, before
the beginning of the year, to irrevocably elect to convert all or any portion
of his or her 1995 annual retainer cash compensation into common shares of
Northeast Utilities, to be purchased on the open market on each quarterly date
of payment. Each such Trustee was also given the opportunity during December,
1994, pursuant to the Deferred Compensation Plan, to irrevocably elect to de-
fer receipt of some or all cash and/or share compensation to a date beyond De-
cember 31, 1995. Deferred share compensation is reflected on the accounts of
the Company at a price per share equal to the closing price of a common share
of Northeast Utilities on the date of payment. Messrs. Donahue, Kelley, Lunt
and Pape and Mmes. Cleveland and Kennan elected to defer all or a portion of
1995 compensation under this plan.
7
<PAGE>
SUMMARY COMPENSATION TABLE
The following table presents the cash and non-cash compensation received by
the five highest paid executive officers of Northeast Utilities, in accordance
with rules of the Securities and Exchange Commission (SEC):
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
------------------------------ ------------------------------------
AWARDS PAYOUTS
-------------------------- ---------
LONG TERM
OTHER INCENTIVE ALL OTHER
ANNUAL RESTRICTED OPTIONS/STOCK PROGRAM COMPENSA-
NAME AND BONUS ($) COMPENSA- STOCK APPRECIATION PAYOUTS TION ($)
PRINCIPAL POSITION YEAR SALARY ($) (NOTE 1) TION ($) AWARD(S) ($) RIGHTS (#) ($) (NOTE 2)
------------------ ---- ---------- --------- --------- ------------ ------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Bernard M. Fox 1994 544,459 (Note 3) None None None 115,771 4,500
President and 1993 478,775 180,780 None None None 61,155 7,033
Chief Executive 1992 424,517 54,340 None None None 19,493 6,860
Officer (Note 4)
William B. Ellis 1994 457,769 (Note 3) None None None 185,003 4,500
Chairman of the Board 1993 521,250 160,693 None None None 87,363 None
(Note 4) 1992 522,212 97,029 None None None 30,707 None
Robert E. Busch 1994 346,122 (Note 3) None None None 44,073 4,500
Executive Vice 1993 255,915 78,673 None None None 32,337 7,072
President and 1992 236,654 27,934 None None None 10,040 6,866
Chief Financial
Officer
John F. Opeka 1994 283,069 (Note 3) None None None 54,556 4,500
Executive Vice 1993 277,304 58,259 None None None 40,014 6,875
President--Nuclear 1992 268,958 19,644 None None None 14,017 6,813
(Service Company Sub-
sidiaries)
Hugh C. MacKenzie 1994 245,832 (Note 3) None None None 40,449 4,500
President 1993 192,502 51,765 None None None 28,000 5,775
(Operating 1992 178,818 22,045 None None None 7,196 5,322
Subsidiaries)
</TABLE>
Notes:
1. Awards under the 1992 short-term program of the Northeast Utilities Execu-
tive Incentive Plan (EIP) were paid in 1993 in the form of unrestricted
stock. Awards under the 1993 short-term EIP program were paid in 1994 in
the form of cash. In accordance with the requirements of the SEC, these
awards are included as "bonus" in the years earned.
2. "All Other Compensation" consists of employer matching contributions under
the 401(k) Plan, generally available to all eligible employees.
3. Awards under the short-term program of the EIP have typically been made by
the Committee on Organization, Compensation and Board Affairs in April each
year. Based on preliminary estimates of corporate performance, and assuming
that the individual performance levels of Messrs. Busch, Opeka and MacKen-
zie approximate those of other system officers, it is estimated that the
five executive officers listed in the table above would receive the follow-
ing awards: Mr. Fox--$303,000; Mr. Ellis--$127,000; Mr. Busch--$165,000;
Mr. Opeka--$81,000; and Mr. MacKenzie--$108,000.
4. Mr. Fox served as President and Chief Operating Officer until July 1, 1993,
when he became President and Chief Executive Officer. Mr. Ellis served as
Chairman of the Board and Chief Executive Officer until July 1, 1993, when
he became Chairman of the Board.
8
<PAGE>
PENSION BENEFITS
The following table shows the estimated annual retirement benefits payable to
an executive officer of Northeast Utilities upon retirement, assuming that re-
tirement occurs at age 65 and that the officer is at that time not only eligi-
ble for a pension benefit under the Northeast Utilities Service Company Re-
tirement Plan (the Retirement Plan) but also eligible for the "make-whole ben-
efit" and the "target benefit" under the Supplemental Executive Retirement
Plan for Officers of Northeast Utilities System Companies (the Supplemental
Plan). The Supplemental Plan is a non-qualified pension plan providing supple-
mental retirement income to system officers. The "make-whole benefit" under
the Supplemental Plan makes up for benefits lost through application of cer-
tain tax code limitations on the benefits that may be provided under the Re-
tirement Plan, and is available to all officers. The "target benefit" further
supplements these benefits and is available to officers at the Senior Vice
President level and higher who are selected by the Board of Trustees to par-
ticipate in the target benefit and who remain in the employ of Northeast Util-
ities companies until at least age 60 (unless the Board of Trustees sets an
earlier age). Each of the executive officers of Northeast Utilities named in
the Summary Compensation Table on page 8 is currently eligible for a target
benefit. If an executive officer were not eligible for a target benefit at the
time of retirement, a lower level of retirement benefits would be paid.
The benefits presented are based on a straight life annuity beginning at age
65 and do not take into account any reduction for joint and survivorship annu-
ity payments.
<TABLE>
<CAPTION>
YEARS OF CREDITED SERVICE
--------------------------------------------------------------------
FINAL AVERAGE
COMPENSATION 15 20 25 30 35
------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$ 200,000 $ 72,000 $ 96,000 $120,000 $120,000 $120,000
250,000 90,000 120,000 150,000 150,000 150,000
300,000 108,000 144,000 180,000 180,000 180,000
350,000 126,000 168,000 210,000 210,000 210,000
400,000 144,000 192,000 240,000 240,000 240,000
450,000 162,000 216,000 270,000 270,000 270,000
500,000 180,000 240,000 300,000 300,000 300,000
600,000 216,000 288,000 360,000 360,000 360,000
700,000 252,000 336,000 420,000 420,000 420,000
800,000 288,000 384,000 480,000 480,000 480,000
900,000 324,000 432,000 540,000 540,000 540,000
1,000,000 360,000 480,000 600,000 600,000 600,000
1,100,000 396,000 528,000 660,000 660,000 660,000
1,200,000 432,000 576,000 720,000 720,000 720,000
</TABLE>
Final average compensation for purposes of calculating the "target benefit"
is the highest average annual compensation of the participant dur- ing any 36
consecutive months compensation was earned. Compensation taken into account
under the "target benefit" described above includes salary, bonus, restricted
stock awards, and long-term incentive payouts shown in the Summary Compensa-
tion Table, but does not include employer matching contributions under the
401(k) Plan. In the event that an officer's employment terminates because of
disability, the retirement benefits shown above would be offset by the amount
of any disability benefits payable to the recipient that are attributable to
contributions made by Northeast Utilities and its subsidiaries under long term
disability plans and policies.
As of December 31, 1994, the five executive officers named in the Summary
Compensation Table above had the following years of credited service for re-
tirement compensation purposes: Mr. Fox--30, Mr. Ellis--18, Mr. Busch--21,
Mr. Opeka--24, and Mr. MacKenzie--29. Assuming that retirement were to occur
at age 65 for these officers, retirement would occur with 43, 29, 38, 35 and
41 years of credited service, respectively.
In 1992, Northeast Utilities entered into agreements with Messrs. Ellis and
Fox to provide for an orderly Chief Executive Officer succession. The agree-
ment with Mr. Ellis calls for him to work with the Board and Mr. Fox to effect
the orderly transition of his responsibilities to Mr. Fox. In accordance with
the agreement, Mr. Ellis stepped down as Chief Executive Officer as of July 1,
1993. The agreement anticipates that he will resign from his position as
Chairman of the Board as of August 1, 1995.
9
<PAGE>
The agreement provides that, upon his retirement, Mr. Ellis will be entitled
to receive from Northeast Utilities and its subsidiaries a target benefit un-
der the Supplemental Plan. His target benefit will be based on the greater of
his actual final average compensation or an amount determined as if his salary
had increased each year since 1991 at a rate equal to the average rate of the
increases of all other target benefit participants and as if he had received
incentive awards each year based on this modified salary, but with the same
performance as the Chief Executive Officer at the time. The agreement also
provides specified death and disability benefits for the period before Mr.
Ellis's 1995 retirement.
The agreement with Mr. Fox states that if he is terminated as Chief Executive
Officer without cause, he will be entitled to specified severance pay and ben-
efits. Those benefits consist primarily of (i) two years' base pay, medical,
dental and life insurance benefits, (ii) a supplemental retirement benefit
equal to the difference between the target benefit he would be entitled to re-
ceive if he had reached the age of 55 on the termination date and the actual
target benefit to which he is entitled as of the termination date, and (iii) a
target benefit under the Supplemental Plan, notwithstanding that he might not
have reached age 60 on the termination date and notwithstanding other forfei-
ture provisions of that plan. The agreement also provides specified death and
disability benefits. The agreement terminates two years after Northeast Utili-
ties gives Mr. Fox a notice of termination, but no earlier than the date he
becomes 55.
The agreements do not address the officers' normal compensation and benefits,
which are to be determined by the Committee on Organization, Compensation and
Board Affairs and the Board in accordance with their customary practices.
10
<PAGE>
REPORT ON EXECUTIVE COMPENSATION
OVERVIEW AND PHILOSOPHY
The Board of Trustees' Committee on Organization, Compensation and Board Af-
fairs (the Committee), no member of which is a former or current employee of
Northeast Utilities (the Company) or its subsidiaries, administers executive
compensation for all Northeast Utilities system officers at or above the vice
president level (who are referred to generally as "officers" in this report).
The objectives of the executive compensation programs are to establish aggres-
sive corporate and individual performance goals that will add to shareholder
value and that will position the Company for the competitive challenges facing
the utility industry, and to set base salary and incentive compensation at
levels that will allow the Company to continue to attract and reward high per-
forming and innovative executive talent.
Northeast Utilities' executive compensation philosophy was developed by the
Committee in conjunction with a consultant, who is familiar with the compensa-
tion practices of other utilities and industries. The Committee has adopted a
strategy of increasing the ratio of incentive pay to base compensation in or-
der to further tie officer pay to results and to reflect industry trends.
Consistent with these objectives, with the assistance of an external consult-
ing firm, the Committee compares the Company's total executive compensation to
the total compensation paid to executives in a broad-based group of over 600
industrials nationwide, in a broad range of more than 50 utilities, and in a
smaller group of utilities. The Committee uses information from the consul-
tant's utility database, along with other external independent compensation
studies, to set appropriate officer base salaries and to establish appropriate
incentive payout targets and ranges. The consultant's database consists of
companies of various revenue and customer size.(/1/)
The Committee does not expect any impact this year as a result of the one-
million dollar cap on deductible executive compensation, and will periodically
re-examine this issue.
ADMINISTRATION
The Committee holds at least three regular meetings each year to discuss ex-
ecutive compensation. At these meetings, the Committee establishes incentive
performance goals for officers, administers incentive plans to further these
goals, and adjusts base compensation and incentive compensation plans accord-
ingly. From time to time, the Committee also holds special meetings to take
action with respect to other executive compensation matters as needed.
The Committee administers the Company's incentive programs for officers. All
awards are subject to Committee approval. The Committee also sets base salary
levels for each officer except Messrs. Ellis and Fox, whose salaries are ap-
proved by the Board of Trustees following a recommendation by the Committee.
The Board accepted the Committee's recommendations for 1994.
OVERVIEW OF ANNUAL BASE SALARY
In setting officer base salaries, the Committee reviews information about re-
gional and national compensation trends, regional economic data, information
about pay program adjustments for the Company's non-officer positions, and the
Company's recent and projected financial performance and condition.
Each officer's base salary is administered within the salary range appropri-
ate to the individual officer's grade and is based upon the individual offi-
cer's performance in such areas as customer satisfaction, plant availability,
service reliability and budget performance, as well as the officer's time in
his/her position.
During 1994, the Committee approved a 3 percent increase in the 1994 base
salary range structures over 1993. The Committee believes this increase is
within the range implemented by other utilities in 1994.
The Committee also met with Mr. Fox and approved a budget of 2 percent for
adjusting base salaries of officers other than Mr. Fox and Mr. Ellis,
-------
/(1)/ The Committee uses two other benchmark groups of utilities in administer-
ing the Company's long-term executive compensation program. The Standard
and Poor's (S&P) Electric Companies Index, which is also the Index used in
the share performance chart on page 14, is the comparison group for the
total shareholder return measure. The Company uses a group of 18 utilities
located in the northeastern region of the United States as its cost-of-
service comparison group. The companies in the consultant's utility data-
base are those that have provided information to the consultant in its
utility practice. Because of this, there is some, but not total, overlap
with the companies in the S&P Electric Companies Index and the cost-of-
service comparison group.
11
<PAGE>
effective May 1, 1994 and approved adjustments to each such officer's base
salary. Any portion of the annual base salary adjustment that exceeds the sal-
ary range going rate is delivered in a one-time lump-sum payment and is not
added to the base salary compensation.
OVERVIEW OF INCENTIVE COMPENSATION
Recognizing the valuable role that incentive compensation can play in moti-
vating individual and corporate performance, the Company has chosen to compen-
sate its officers using incentive programs linked to a variety of performance
measures, including total shareholder return. Under the Executive Incentive
Plan (EIP), new incentive programs are initiated near the beginning of each
year. The programs have consisted of a series of short-term programs with one-
year performance periods and long-term programs with three-year performance
periods. The Committee reviews the results of incentive programs initiated in
previous years at the conclusion of the specified performance cycles, and
makes awards reflecting actual performance against the EIP goals.
The Committee periodically reviews the reasonableness of both design and pay-
out levels of the incentive programs to ensure their linkage to corporate per-
formance and strategic objectives, and to keep the programs competitive.
Corporate results for the EIP, i.e. whether and to what extent corporate goals
have been attained, are audited by the Company's independent public accoun-
tants.
THE 1994 SHORT-TERM INCENTIVE PROGRAM
In January, 1994 the Committee established a 1994 short-term program under
the EIP. All officers were selected as participants. Awards under this program
will be in cash.
The target payouts, i.e., the amounts that will be paid if target levels are
attained for all program goals, range from 15 percent of 1994 program salary
for a vice president to 25 percent of 1994 program salary for the Chief Execu-
tive Officer (CEO). The 15 percent target for vice presidents represents an
increase from the prior year target of 10 percent. Program salaries are the
going rate for the grade of each officer. Actual short-term awards for indi-
vidual officers will vary from the targets depending on fulfillment of corpo-
rate goals. Short-term awards for officers other than Messrs. Ellis and Fox
will further vary depending on individual performance measured against goals
established for each officer at the beginning of 1994.
The Committee sets quantifiable corporate goals in the areas of budget per-
formance and return on equity (ROE). An ROE target and an operating and main-
tenance budget target were established for 1994. Both goals have a threshold
level, under which no amount is awarded. Each goal is weighted equally. The
Committee adopted the individual goals proposed by Mr. Fox for the officers.
These individual goals included such factors as capacity and unit availabili-
ty, budget performance, environmental initiatives, customer satisfaction, and
economic development. Pre-established weights were assigned to each officer's
performance measures. Awards under this program will be made by the Committee
later in 1995 following a review of corporate and individual performance re-
sults.
THE 1994-1996 LONG-TERM INCENTIVE PROGRAM
In January, 1994 the Committee established a 1994-1996 long-term program un-
der the EIP. Awards under the 1994-1996 long-term incentive program will be
made in Northeast Utilities common shares in 1997. All officers were selected
as participants.
The Committee increased the target payouts for the 1994-1996 program, i.e.,
the amounts that will be paid if target levels are attained for all program
goals, 10 percentage points for those officers above the Vice President level,
compared to the 1993-1995 program. The target payouts are 35 percent for the
CEO, 30 percent for Group Presidents, 25 percent for Executive and Senior Vice
Presidents, and 10 percent for Vice Presidents.
The target award of each participant was set at a number of "performance
share opportunity units" (PSO units), each equal in value to a common share of
Northeast Utilities, which is adjusted to reflect dividends paid during the
program performance cycle. At the end of the program cycle, each officer's al-
located PSO units will be adjusted by the ratio of a calculated actual corpo-
rate performance factor to the target corporate performance factor.
The 1994-1996 long-term program factors are cost-of-service change relative
to an eighteen utility company comparison group and total shareholder return
relative to the S&P Electric Compa-
12
<PAGE>
nies Index. These factors are weighted equally. The cost-of-service goal will
be met at target if the Company's average cost of service (COS) changes by the
same percentage as the COS average of the other companies in the comparison
group. The shareholder return goal will be met at target if the total return
on a Northeast Utilities common share for the performance period equals the
return on the S&P Electric Companies Index for the same period.
THE 1991-1993 LONG-TERM INCENTIVE PROGRAM
The 1991-1993 long-term program goals were based on the Company's relative
ranking over the period against comparable electric utilities with respect to
ROE, common share market-to-book ratio, and change in cost of service. During
1991-1993, the Company substantially exceeded the target level set for these
goals. Awards resulted in actual aggregate payouts of 13.73 percent relative
to a 10 percent target for Vice Presidents, 20.60 percent relative to a 15
percent target for the Executive and Senior Vice Presidents, 28.6 percent rel-
ative to a 20.8 percent target for Mr. Fox, and 32.0 percent relative to a
23.3 percent target for Mr. Ellis.
DISCUSSION OF CEO AND CHAIRMAN TOTAL COMPENSATION
During 1994, the Committee, with the participation of Mrs. Cheryl W. Grise,
Senior Vice President --Human Resources and Administrative Services of North-
east Utilities Service Company, evaluated Mr. Fox's contributions relative to
the Company's performance. This evaluation was performed for the purpose of
adjusting the base salary of Mr. Fox. In establishing Mr. Fox's 1994-1995 base
salary, the Committee took into account Mr. Fox's increased responsibility as
CEO, the substantially improved financial performance of the Company, the com-
petitive market data for CEO compensation and the overall performance of the
Company in such areas as budgetary performance, plant availability and relia-
bility and customer satisfaction. Based on these factors, the Committee recom-
mended and the Board approved an increase of 5 percent for Mr. Fox from
$525,000 per year to $551,300 per year, effective May 1, 1994. As part of the
transition of responsibilities from Mr. Ellis to Mr. Fox, the Committee recom-
mended and the Board adjusted Mr. Ellis's salary to $400,000 (a reduction of
$100,000), effective July 3, 1994.
During 1994, the Committee modified the target awards for Mr. Fox and Mr. El-
lis under the 1991-1993 long-term EIP program on a pro rata basis to reflect
Mr. Fox's promotion to CEO in July, 1993. Mr. Fox received an award of 3,084
unrestricted common shares and Mr. Ellis received an award of 4,929 unre-
stricted common shares, in each case net of withholding taxes. Mr. Fox's and
Mr. Ellis's estimated 1994 short-term awards are shown in the Summary Compen-
sation Table.
CONCLUSION
The Committee believes Northeast Utilities' executive compensation program
appropriately links executive officer compensation to individual and corporate
performance and shareholder value, is competitive with comparable companies,
and is sensitive to the concerns of customers, shareholders, and other con-
stituencies. The Committee believes that by increasing the ratio of incentive
pay to base compensation, basing the CEO's and the Chairman's incentive com-
pensation exclusively on fulfillment of corporate rather than individual
goals, and incorporating performance share opportunity units under the long-
term incentive program, Northeast Utilities has implemented an executive com-
pensation program that is closely aligned with shareholder interests.
Respectfully submitted,
Eugene D. Jones, Chairman
Elizabeth T. Kennan, Vice Chairman
Cotton Mather Cleveland
George David
Denham C. Lunt, Jr.
William J. Pape II
Robert E. Patricelli
Norman C. Rasmussen
Dated: January 24, 1995
13
<PAGE>
SHARE PERFORMANCE CHART
The following chart compares the cumulative total return on an investment in
Northeast Utilities common shares with the cumulative total return of the
Standard & Poor's (S&P) 500 Stock Index and the S&P Electric Companies Index
over the last five fiscal years, in accordance with the rules of the SEC:
[ART APPEARS HERE]
<TABLE>
COMPARISON OF FIVE YEAR CUMULATIVE RETURN
AMONG Northeast Utilities, S&P 500 INDEX AND S&P Electric
Companies INDEX
<CAPTION>
Measurement period S&P NU S&P
(Fiscal Year Covered) Electric Common 500
--------------------- -------- -------- --------
<S> <C> <C> <C>
Measurement PT -
01/89 $ 100 $ 100 $ 100
FYE 01/90 $ 103 $ 97 $ 97
FYE 01/91 $ 134 $ 124 $ 126
FYE 01/92 $ 141 $ 150 $ 136
FYE 01/93 $ 159 $ 143 $ 150
FYE 01/94 $ 139 $ 141 $ 152
</TABLE>
14
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Northeast Utilities Service Company (NUSCO), a subsidiary of Northeast Utili-
ties, selected ValueRx, a subsidiary of Value Health, Inc., through a competi-
tive bid process to serve as one of NUSCO's prescription drug providers under
its Group Insurance Plan during 1994. The total payments made by NUSCO to
ValueRx during 1994 to administer the Company's prescription drug program were
$900,000. Mr. Patricelli, who is standing for re-election as a Trustee of
Northeast Utilities, is Founder, Chairman and Chief Executive Officer of Value
Health, Inc.
The law firm of Sheehan, Phinney, Bass & Green rendered legal services to
North Atlantic Energy Service Corporation, a subsidiary of Northeast Utili-
ties, for which fees paid in 1994 totaled approximately $53,000. Mr. Swope,
who is standing for re-election as a Trustee of Northeast Utilities, is of
counsel to the firm.
3. RATIFICATION OF THE SELECTION OF AUDITORS
The firm of Arthur Andersen LLP, independent public accountants, was selected
by the Board of Trustees, and approved by the shareholders, to serve as inde-
pendent auditors of Northeast Utilities and its subsidiaries for 1994.
Pursuant to the recommendation of the Audit Committee, the Board of Trustees
recommends that shareholders ratify the selection by the Board of Trustees of
Arthur Andersen LLP to audit the accounts of Northeast Utilities and its sub-
sidiaries for 1995.
Representatives of Arthur Andersen LLP are expected to be present at the
meeting. They will have the opportunity to make a statement, if they desire to
do so, and to respond to appropriate questions raised at the meeting.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE FOR THIS PROPOSAL.
4. OTHER MATTERS
The Board of Trustees knows of no matters other than the foregoing to come
before the meeting. However, if any other matters come before the meeting, the
persons named in the enclosed proxy will vote in their discretion with respect
to such other matters.
Northeast Utilities' Annual Report to Shareholders for the year ended Decem-
ber 31, 1994, including financial statements, is being mailed with this proxy
solicitation material. An additional copy of the Annual Report will be mailed
to any shareholder upon request.
COST OF SOLICITATION OF PROXIES
The cost of soliciting proxies on behalf of the Board of Trustees will be
borne by Northeast Utilities. In addition to the use of the mails, proxies may
be solicited by personal interview, telephone or telegraph, by Trustees, offi-
cers or employees of Northeast Utilities or NUSCO, or by an independent compa-
ny, Morrow & Co., Inc., which has been retained to assist in the solicitation
of proxies from banks, brokerage firms, nominees and individual shareholders
for a fee of $12,000 plus reimbursement for expenses. Arrangements will be
made to reimburse brokerage firms, nominees, custodians and fiduciaries for
expenses incurred in forwarding solicitation materials to the beneficial own-
ers of common shares held as of March 24, 1995.
15
<PAGE>
MULTIPLE COPIES OF ANNUAL REPORT TO SHAREHOLDERS
Some shareholders with multiple accounts may receive more than one Annual Re-
port to Shareholders, which is costly to Northeast Utilities and may be incon-
venient to those shareholders. Northeast Utilities will discontinue multiple
mailings of Annual Reports to Shareholders, if the affected shareholders so
request. To request discontinuance of multiple mailings of the Annual Report,
please mark the designated box on the proxy card(s) for the account(s) for
which Annual Report mailings may be discontinued. Mailing of dividends, divi-
dend reinvestment statements, proxy materials and special notices will not be
affected by an election to discontinue multiple mailings of the Annual Report
to Shareholders.
VOTING PROCEDURES
Shares held by persons who abstain from voting on any proposal and broker
non-votes will not be voted for or against the proposal. Shares held by per-
sons abstaining will be counted in determining whether a quorum is present for
the purpose of voting on the proposal; however, broker non-votes will not be
counted for this purpose.
SHAREHOLDER PROPOSALS FOR 1996 ANNUAL MEETING
To be included in the proxy statement and form of proxy for the 1996 Annual
Meeting of Shareholders, proposals by shareholders must be received by Theresa
H. Allsop, Assistant Secretary of Northeast Utilities, at Northeast Utilities'
general office by December 4, 1995, and must satisfy the conditions estab-
lished by the SEC.
By order of the Board of Trustees,
/s/ Robert P. Wax
Robert P. Wax
Secretary
ANNUAL REPORT ON FORM 10-K
NORTHEAST UTILITIES WILL PROVIDE SHAREHOLDERS WITH A COPY OF ITS 1994 ANNUAL
REPORT ON FORM 10-K TO THE SEC, INCLUDING THE FINANCIAL STATEMENTS AND SCHED-
ULES THERETO, WITHOUT CHARGE, UPON RECEIPT OF A WRITTEN REQUEST SENT TO:
THERESA H. ALLSOP
ASSISTANT SECRETARY
NORTHEAST UTILITIES
POST OFFICE BOX 270
HARTFORD, CONNECTICUT 06141-0270
16
<PAGE>
P R O X Y P R O X Y
NORTHEAST UTILITIES
PROXY FOR ANNUAL MEETING OF
SHAREHOLDERS - MAY 23, 1995
The undersigned appoints WILLIAM B. ELLIS
and WILLIAM J. PAPE II, and either of
them, proxies of the undersigned, with
power of substitution, to act for and to
vote all common shares of the undersigned
at the Annual Meeting of Shareholders of
Northeast Utilities to be held on May 23,
1995, and any adjournment thereof, upon
the matters set forth in the notice of
said meeting as indicated below. The
proxies are further authorized to vote,
in their discretion, upon such other
business as may properly come before the
meeting or any adjournment thereof.
When properly executed, this proxy will
be voted as specified by the undersigned.
Unless otherwise instructed, this proxy
will be voted FOR proposals 1, 2 and 3.
THIS PROXY IS SOLICITED ON BEHALF OF THE
BOARD OF TRUSTEES
(OVER)
<PAGE>
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR
PROPOSALS 1, 2 AND 3.
1. Fix the number of Trustees at thirteen.
[_] [_] [_]
FOR AGAINST ABSTAIN
2. Election of the thirteen Trustees nominated.
[_] [_] [_]
FOR FOR ALL EXCEPT AS MARKED WITHHELD
TO VOTE FOR ALL NOMINEES, MARK THE "FOR" BOX. TO WITHHOLD VOTING FOR A
PARTICULAR NOMINEE(S), MARK THE "FOR ALL EXCEPT AS MARKED" BOX AND STRIKE
A LINE THROUGH THE NAME OF THE NOMINEE(S) IN THE LIST BELOW. TO WITHHOLD
VOTING ON ALL NOMINEES, MARK THE "WITHHELD" BOX.
Alfred F. Boschulte, Cotton Mather Cleveland, George David, William B.
Ellis, Bernard M. Fox, Gaynor N. Kelley, Elizabeth T. Kennan, Denham C.
Lunt, Jr., William J. Pape II, Robert E. Patricelli, Norman C. Rasmussen,
John F. Swope, John F. Turner.
3. Ratification of Arthur Andersen LLP as independent auditors for 1995.
[_] [_] [_]
FOR AGAINST ABSTAIN
The undersigned hereby acknowledges receipt of notice of meeting and
related proxy statement.
Date............................................................1995
SIGNED..............................................................
SIGNED..............................................................
Please sign in the same form as name appears hereon. If the shares are
registered in more than one name, each joint owner or fiduciary should
sign.
Fiduciaries and corporate officers should indicate their titles.
Discontinue mailing Annual Report for this account. (See Proxy Statement,
page 16). [_]
I PLAN TO ATTEND THE MEETING. [_] YES [_] NO
