MDU Resources Group, Inc. 8-K Executive and Compensation Information
UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE
ACT OF 1934
Date
of Report (Date of earliest event reported) February 16, 2006
MDU
Resources Group, Inc.
(Exact
name of registrant as specified in its charter)
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Delaware
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1-3480
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41-0423660
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(State
or other jurisdiction of
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(Commission
File Number)
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(I.R.S.
Employer Identification No.)
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incorporation)
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1200
West Century Avenue
P.O.
Box 5650
Bismarck,
North Dakota 58506-5650
(Address
of principal executive offices)
(Zip
Code)
Registrant’s
telephone number, including area code (701) 530-1000
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
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Item
1.01 Entry Into A Material Definitive Agreement.
2006
On
February 14, 2006, the Compensation Committee (the "Committee") of the
Board of Directors (the "Board") of MDU Resources Group, Inc. (the "Company")
established 2006 annual award opportunities for the executive officers who
will
be named executive officers ("NEOs") in the proxy statement for the 2006 Annual
Meeting of Stockholders. The Board approved the award opportunities at its
meeting on February 16, 2006. Filed herewith as Exhibit 10.1 and incorporated
herein by reference is the 2006 NEO Annual Award Opportunity Chart.
Executive
officers may receive annual cash incentive awards based upon achievement of
annual performance measures with a threshold, target and maximum level. A target
incentive award is established based upon the position level and actual base
salary, or in the Committee’s discretion, the assigned salary grade market
value. Actual payment may range from zero to 200% of the target based upon
achievement of corporate goals and individual performance.
Participants
who retire, die or become disabled during the year remain eligible to receive
an
award. Subject to the Committee’s discretion, participants who terminate
employment for other reasons are not eligible for an award. The Committee has
full discretion to determine the extent to which goals have been achieved,
the
payment level, whether any final payment will be made and whether to adjust
awards.
Mr.
White's and Mr. Hildestad's 2006 awards were made pursuant to the 1997 Executive
Long-Term Incentive Plan. The performance goals for 2006 for Mr. White and
Mr.
Hildestad are (i) budgeted earnings per share achieved (weighted 50%) and
(ii) budgeted return on invested capital achieved (weighted 50%), with respect
to the Company. Achievement of budgeted levels of earnings per share and return
on invested capital would result in a potential award of 100% of the target
amount. Achievement of less than 85% would result in no payment, while
achievement of 115% would result in a payment of 200% of the target amount.
Filed herewith as Exhibit 10.2 is the MDU Resources Group, Inc. 1997 Executive
Long-Term Incentive Plan Performance Share Award Agreement.
Mr.
Castleberry’s 2006 award for the two-month period of January and February will
be based on the WBI Holdings, Inc. Executive Incentive Compensation Plan,
payments under which will be based upon (i) WBI Holdings, Inc. budgeted earnings
per allocated share achieved (weighted 50%) and (ii) WBI Holdings, Inc. budgeted
return on invested capital achieved (weighted 50%). Mr. Castleberry's 2006
award
for the ten-month period of March through December was made pursuant to the
MDU
Resources Group, Inc. Executive Incentive Compensation Plan based upon (i)
budgeted earnings per share achieved (weighted 50%) and (ii) budgeted return
on
invested capital achieved (weighted 50%). Achievement of budgeted levels of
earnings per share and return on invested capital would result in a potential
award of 100% of the target amount. Achievement of less than 85% would result
in
no payment, while achievement of 115% would result in a payment of 200% of
the
target amount. Mr. Castleberry is also being provided a one time
performance bonus relating to financial improvements and/or efficiency gains
in
the functions that he will manage as Executive Vice President -
Administration. Payment will range from $0.00 to $250,000, depending
on actual results versus performance measures. In addition, if Mr.
Castleberry’s future pension benefit payment or supplemental income
security plan excess payment is less than he would be entitled to
receive if he separated from employment on a March 3, 2006, the Company
will make a supplemental payment from the general assets of the Company for
the
shortfall.
Mr.
Imsdahl's 2006 award was made pursuant to the Montana-Dakota Utilities Co.
Executive Incentive Compensation Plan, based upon (i) budgeted earnings per
allocated share achieved (weighted 50%) and (ii) budgeted return on invested
capital achieved (weighted 50%). Achievement of budgeted levels of earnings
per
allocated share and return on invested capital would result in a potential
award
of 100% of the target amount. Achievement of less than 85% would result in
no
payment, while achievement of 115% would result in a payment of 200% of the
target amount.
Mr.
Robinson received no award because of his retirement.
The
Committee also approved limiting EICP payments above the targeted incentive
amounts at the major business units, which include Montana-Dakota Utilities
Co.
and WBI Holdings, Inc. The limitation restricts total payments at the major
business units to ensure
that only a portion of incremental earnings above budget will be paid to EICP
participants.
Amendment
of Plan
On
February 16, 2006, the Board amended the 1997 Executive Long-Term Incentive
Plan, subject to shareholder approval at the Annual Meeting of Stockholders
to
be held on April 25, 2006, to (i) change the name of the plan to the “Long-Term
Performance-Based Incentive Plan,” (ii) extend the term of the plan until
all shares subject to the plan have been issued, (iii) add minimum vesting
requirements for full value awards (awards other than stock options or stock
appreciation rights) and (iv) make other non-material changes.
Item
5.02 Departure of Directors or Principal Officers; Election of Directors;
Appointment of Principal Officers.
Martin
A.
White, the Chairman of the Board and Chief Executive Officer of MDU Resources
Group, Inc., will be retiring as a Director and an Officer following the regular
August 2006 meeting of the Board of Directors. Mr. White will be retiring in
accordance with the mandatory retirement provisions in the Company’s
Bylaws. The Company Bylaws provide that Mr. White as a “high ranking
executive” is ineligible to serve as a Director and Officer beyond the first
regular meeting of the Board after the date he reaches age 65.
Robert
L.
Nance will also be retiring as a Director of the Company following the regular
August 2006 meeting of the Board of Directors in accordance with the mandatory
retirement provisions in the Company’s Bylaws. Mr. Nance as a non-employee
Director is ineligible under the Company Bylaws to continue to serve beyond
the
first regular meeting of the Board after the date he reaches age
70.
Item
8.01 Other Events.
John
K.
Castleberry, 51, chief executive officer of WBI Holdings, Inc., will become
executive vice president of administration for MDU Resources Group, Inc.,
effective March 4, 2006. Mr. Castleberry has been with the Company for 24 years.
Steven
L.
Bietz, 47, president of WBI Holdings, Inc., has been named to the additional
position of chief executive officer of WBI Holdings effective March 4, 2006.
Mr.
Bietz has been with the Company for 25 years.
Item
9.01. Financial Statements and Exhibits.
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Exhibit
Number
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Description
of Exhibit
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10.1
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MDU
Resources Group, Inc. 2006 NEO Annual Award Opportunity Chart
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10.2
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MDU
Resources Group, Inc. 1997 Executive Long-Term Incentive Plan Award
Agreement
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SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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MDU
RESOURCES GROUP, INC.
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Date
February
23, 2006
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By
/s/
VERNON A. RAILE
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Vernon
A. Raile
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Executive
Vice President and
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Chief
Financial Officer
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EXHIBIT
INDEX
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Exhibit
Number
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Description
of Exhibit
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10.1
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MDU
Resources Group, Inc. 2006 NEO Annual Award Opportunity Chart
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10.2
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MDU
Resources Group, Inc. 1997 Executive Long-Term Incentive Plan Award
Agreement
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