Hartford-based Northeast Utilities and NStar in Boston have established bonus pools totaling $22.5 million to retain at least the nine highest-ranking officers once the two utility companies merge later this year, documents show.
In November — a month after the two announced plans for a $4.3 billion merger — NU and NStar separately set up $10 million retention pools aimed at keeping top officers at each company around for at least three years after the merger is complete, according to the 2010 annual reports recently filed by both.
“It is standard during mergers to retain the top executives of the company,” NU spokesman Al Lara said.
In addition, Charles Shivery, NU’s chairman, president and CEO, stands to collect a $2.5 million bonus for staying on to finish a previously arranged 18-month term as nonexecutive chairman of the new company, Lara said. He is subsequently due to retire.
Shivery’s bonus would be on top of regular pay package. His 2010 base salary was $1 million as part of his total compensation of $8.3 million, filings show.
When he retires, Shivery will collect $31.5 million in post-employment compensation, amassed during his tenure at NU, according to a filing with the Securities and Exchange Commission.
Shivery joined NU in 2002 and became CEO two years later.
The NU-NStar merger is expected to be completed this summer. It will create a utility holding company with four electric and two natural gas subsidiaries and 3.5 million customers in Connecticut, Massachusetts and New Hampshire.
The new company still will be called Northeast Utilities. NU’s subsidiaries include Connecticut-based Yankee Gas and Connecticut Light & Power.
On Friday, NU’s shareholders approved the merger, getting 98 percent of the shares voted in favor of joining with NStar.
NU established its $10 million award fund on Nov. 16. It covers NU Chief Financial Officer David McHale, Chief Operating Officer  Leon Olivier, General Counsel Gregory Butler and Senior Vice President James Robb, according to NU’s annual report. Olivier also is CL&P CEO.
Each would collect the bonus in varying amounts in the form of restricted stock that vests three years after the merger.
NU’s bonus pool is paid for strictly by shareholders, Lara said.
McHale took home $5 million in total compensation last year, Olivier made $4.3 million, Butler made $3.6 million and Robb made $2.3 million, according to the annual report.
NStar established its $10 million bonus fund two days later on Nov. 18. Like NU’s package, the employees covered only receive their funds if they stay on three years after the merger is completed, or if they die, become disabled or are terminated without cause, filings said.
NStar officers covered by the fund include:  Christine Carmody, senior vice president of human resources; James Judge, chief financial officer; Joseph Nolan, senior vice president customer & corporate relations; and Werner Schweiger, senior vice president operations, according to NStar’s annual report.
The bonus commitment to those four NStar officers represents 30 percent of the $10 million, said NStar spokeswoman Caroline Allen. The balance of the bonus pool may be committed to more employees later on, Allen said.
NStar’s filing did not spell out whether Chairman Thomas May is eligible for a retention bonus. Â In 2009, May’s base salary was just over $1 million and his total compensation was $7.4 million, according to Forbes.com.
May is due to become CEO of NU after the merger. He will assume the chairman role once Shivery retires.
