Xcel Energy 2013 Annual Report Download - page 120

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The PSP awards granted for the years ended Dec. 31 were as follows:
(In Thousands) 2013 2012 2011
Awards granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215 161 311
The total amounts of performance awards settled during the years ended Dec. 31 were as follows:
(In Thousands) 2013 2012 2011
Awards settled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108 286 305
Settlement amount (cash and common stock). . . . . . . . . . . . . . . . . . . . . . . $ 3,057 $ 7,554 $ 7,200
The amount of cash used to settle Xcel Energy’s PSP awards was $1.5 million, $3.8 million and $3.6 million in 2013, 2012 and 2011,
respectively.
Share-Based Compensation Expense — The vesting of the RSUs is generally predicated on the achievement of a performance
condition, which is the achievement of an EPS or environmental measures target. Additionally, approximately 0.2 million of RSUs
were granted in 2013 with vesting subject only to service conditions for periods up to five years. RSU awards and restricted stock are
considered to be equity awards, since the plan settlement determination (shares or cash) resides with Xcel Energy and not the
participants. In addition, these awards have not been previously settled in cash and Xcel Energy plans to continue electing share
settlement. The grant date fair value of RSUs and restricted stock is expensed over the service period as employees vest in their rights
to those awards.
The PSP awards have been historically settled partially in cash, and therefore, do not qualify as equity awards, but rather are accounted
for as liability awards. As liability awards, the fair value on which ratable expense is based, as employees vest in their rights to those
awards, is remeasured each period based on the current stock price and performance conditions, and final expense is based on the
market value of the shares on the date the award is settled.
The compensation costs related to share-based awards for the years ended Dec. 31 were as follows:
(Thousands of Dollars) 2013 2012 2011
Compensation cost for share-based awards (a) (b) (c) . . . . . . . . . . . . . . . . . . . $ 24,613 $ 26,970 $ 45,006
Tax benefit recognized in income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,571 10,513 17,559
Capitalized compensation cost for share-based awards . . . . . . . . . . . . . . . 1,698 4,270 3,857
(a) Compensation costs for share-based payment arrangements is included in O&M expense in the consolidated statements of income.
(b) Included in compensation cost for share-based awards are matching contributions related to the Xcel Energy 401(k) plan, which totaled $7.0 million, $22.2 million
and $21.6 million for the years ended 2013, 2012 and 2011, respectively.
(c) In October 2013, Xcel Energy determined that it would settle the 2013 401(k) employer match in cash instead of common stock for all employee groups except
PSCo bargaining employees. Share-based compensation accounting for the impacted employee groups ceased in October 2013, and corresponding expense
amounts recorded to equity were reclassified to a liability for expected cash settlements.
The maximum aggregate number of shares of common stock available for issuance under the Xcel Energy Inc. 2005 Long-term
Incentive Plan (as amended and restated effective Feb. 17, 2010) is 8.3 million shares. Under the Xcel Energy Inc. Executive Annual
Incentive Award Plan (as amended and restated effective Feb. 17, 2010), the total number of shares approved for issuance is 1.2
million shares.
As of Dec. 31, 2013 and 2012, there was approximately $22.1 million and $15.3 million, respectively, of total unrecognized
compensation cost related to nonvested share-based compensation awards. Xcel Energy expects to recognize the amount
unrecognized at Dec. 31, 2013 over a weighted average period of 1.8 years.
9. Benefit Plans and Other Postretirement Benefits
Xcel Energy offers various benefit plans to its employees. Approximately 48 percent of employees that receive benefits are
represented by several local labor unions under several collective-bargaining agreements. At Dec. 31, 2013:
• NSP-Minnesota had 2,022 and NSP-Wisconsin had 399 bargaining employees covered under a collective-bargaining
agreement, which expires at the end of 2016. NSP-Minnesota also had an additional 248 nuclear operation bargaining
employees covered under several collective-bargaining agreements, which expire at various dates in 2015 and 2016.
• PSCo had 2,086 bargaining employees covered under a collective-bargaining agreement, which expires in May 2014.
• SPS had 832 bargaining employees covered under a collective-bargaining agreement, which expires in October 2014.