ComEd 2006 Annual Report Download - page 375

Committee Membership Key
Audit = 1, Compensation = 2, Corporate Governance = 3, Energy Delivery Oversight = 4,
Generation Oversight = 5, Risk Oversight = 6
Fees Earned or Paid in Cash
All directors receive an annual retainer of $35,000. Committee chairs receive an additional $5,000
per year. Members of the Audit Committee and Generation Oversight Committee, including the
committee chairs, receive and additional $5,000 per year membership retainer.
Directors receive $1,500 meeting fee for each board and committee meeting attended, whether in
person or by means of teleconferencing or video conferencing equipment. Directors also receive a
$1,500 meeting fee for attending the annual shareholders meeting, and annual strategy retreat.
Through October, 2006 directors also received a $1,500 per diem fee for their attendance or
participation in industry events at the request of Exelon and for attending approved orientation or
continuing education programs. In October 2006, the corporate governance committee acted to
eliminate the payment of any further per diem fees.
Directors may elect to defer any portion their cash compensation into a non-qualified multi-fund
deferred compensation plan. Each director has a record keeping account where the dollar balance can
be invested in a basket of mutual funds including one fund composed entirely of Exelon common stock.
These funds are identical to those available to company employees who participate in the Exelon
Employee Savings Plan. Fund balances including those amounts invested in the Exelon common stock
fund are settled in cash and may be distributed upon reaching age 65 or upon retirement from the
board.
Stock Awards
Directors are required under the Exelon Corporate Governance Principles to own 6,000 shares of
Exelon common stock or deferred Exelon common stock units within three years after their election to
the board. At a stock price of $60, the ownership requirement is equivalent to $360,000, or
approximately ten times the annual cash retainer. This requirement is significantly in excess of the
minimum three times annual cash retainer stock ownership requirements recommended by corporate
governance groups such as Institutional Shareholder Services. The ownership requirement is intended
to align the interests of directors with the interests of shareholders so that directors benefit when
Exelon’s stock price increases and suffer when it declines. Rather than paying directors entirely in
cash, Exelon pays a significant portion of director compensation in the form of deferred stock units.
The deferred stock units are not paid out to the directors until they retire from the board, leaving these
amounts at risk during the director’s entire tenure on the board.
All directors receive $60,000 worth of deferred Exelon common stock units per year, which accrue
at the end of each calendar quarter based upon the closing price of Exelon common stock on the day
the quarterly dividend is paid. Deferred stock units are accrued in an unfunded record keeping account
maintained by the company and earn the same dividends available to all holders of Exelon common
stock, which are reinvested in the account as additional units.
As of December 31, 2006 the directors held the following amounts of deferred Exelon common
stock units. The units are valued at the closing price of Exelon common stock on December 31, 2006,
which was $61.89. Legacy plans include those stock units earned from Exelon’s predecessor
companies, PECO Energy Company and Unicom Corporation. For three directors who served on the
PECO Energy board of directors, a portion of the legacy deferred stock units was granted as a
conversion of the accrued benefits under the PECO Energy Directors Retirement Plan when the plan
370