The pay plan, which drew sharp criticism across Montana, was to have been discussed Wednesday at a hearing on the company's ongoing bankruptcy case in Delaware, said Bob Rowe, chairman of the Montana Public Service Commission.
The company has pulled that item from the agenda, said Roger Schrum, a NorthWestern vice president who would have benefited from the pay and bonus plan. No alternative executive pay plan has been developed, although Schrum said he anticipated a new plan would be announced soon.
Rowe said he hoped any future bonus plan would be more generous with the company's workers, who did the manual labor to get NorthWestern Energy out of bankruptcy. He said the company's top executive, Gary Drook, told him the company planned to submit a new plan that would set aside 6 percent of the equity in the company, but he said he wasn't sure how far down the chain of command pay raises and bonuses would reach.
"Drook's statement to me was that he had 'heard us,' " Rowe said, referring to the commissions strong opposition to the multimillion-dollar bonus package. "We'll have to see what happens."
The bonus plan was based on a study by a New York company that specializes in setting executive pay, Schrum said. It also included raises for some of the company's top executives, including him.
The current pay plan for NorthWestern's top brass expires when the company emerges from bankruptcy, anticipated some time late this year. Schrum said earlier that the company now needs a new plan.
Additionally, NorthWestern's creditors have overwhelmingly approved a plan to move the company out of bankruptcy. The plan, Schrum said, would allow entities to whom NorthWestern owes some $2.2 billion in debt to exchange their debts for stock in the newly-reorganized NorthWestern Corp. Under the plan, creditors would still end up losing money.
"We wouldn't have filed for bankruptcy if everyone was going to get a dollar for dollar exchange" of debt to stock, Schrum said.
In other news, the company has identified, but not publicly named, its new board of directors. The seven-member board will include the company's chief executive officer and six new people. One of them, Schrum said, is a Montana resident, while another is a former utility regulator. The board will be publicly announced after they formally accept the offer to run the new company.
NorthWestern Corp. is the parent company of NorthWestern Energy, the regional utility which has about 175,000 electrical customers and 600,000 natural gas customers in Montana.
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