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Form 8-K

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): October 11, 2006

 

UNITED TECHNOLOGIES CORPORATION

(Exact name of registrant as specified in its charter)

 

 

Delaware   1-812   06-0570975

(State or other jurisdiction

of incorporation)

   (Commission File Number)  

(I.R.S. Employer

Identification No.)

One Financial Plaza Hartford, Connecticut 06103

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code (860) 728-7000

N/A

(Former name or former address, if changed since last report)

 

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:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Section 1 – Registrant’s Business and Operations

Item 1.01. Entry into a Material Definitive Agreement

The United Technologies Corporation 2005 Long Term Incentive Plan (the “2005 LTIP”), approved by shareholders in April 2005, provides for various forms of awards to directors, executive officers and employees of United Technologies Corporation (the “Company”) based on the value of shares of Common Stock of the Company, including awards that vest solely on the basis of performance targets.

On October 11, 2006, the Committee on Compensation & Executive Development (the “Committee”) of the Board of Directors of the Company approved performance targets for Performance Share Units to be awarded in 2007 under the 2005 LTIP. Performance Share Units awarded in 2007 will vest only if pre-established three year targets are achieved for the following performance measures: the compound annual growth rate in the Company’s diluted earnings per share and the Company’s total shareowner return compared to other companies included in the S&P 500. Actual award statements will specify the applicable performance targets, the minimum performance required for vesting, the range of vesting relative to measured performance and the relative weighting of each target.

The form of award agreement for Performance Share Units and Stock Appreciation Rights to be awarded in 2007 under the 2005 LTIP is attached hereto as Exhibit 10.1 and is hereby incorporated by reference.

Section 9—Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits

(d) Exhibits.

 

Exhibit
Number		  

Exhibit Description

10.1   Form of award agreement for Performance Share Unit and Stock Appreciation Right awards to be granted in 2007 under the United Technologies 2005 Long Term Incentive Plan

SIGNATURES

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.

 

 

UNITED TECHNOLOGIES CORPORATION

(Registrant)

Date: October 13, 2006    
  By:  

/s/ Charles F. Hildebrand

    Charles F. Hildebrand
    Assistant Secretary and Associate General Counsel

EXHIBIT INDEX

 

Exhibit
Number		  

Exhibit Description

10.1   Form of award agreement for Performance Share Unit and Stock Appreciation Right awards to be granted in 2007 under the United Technologies 2005 Long Term Incentive Plan
Form of award agreement

Exhibit 10.1

 

Your 2007 Long Term Incentive Award

Performance. Results. Rewards.

 

 

Grant Date:

 

 

About This Statement

 

This personalized statement shows your 2007 Award under United Technologies Corporation’s Long Term Incentive Plan (LTIP). On the reverse side of this statement, you will find highlights of how the LTIP works. The award shown in this statement is subject to the terms and conditions of the LTIP.

 

 

Your 2007 Long Term Incentive Plan Award

 

How the Award Is Distributed:   

n  Stock Appreciation Rights (SARs), and

n  Performance Share Units (PSUs)

 

Type

  

Number of

Units

  

Grant

Price

  

Estimated

Present Value

  

Vesting

Date

   

Expiration

Date

SARs

                     

PSUs*

                     

Total Estimated Present Value:

             

    *PSUs are subject to performance-based vesting criteria

 

Performance Targets:   

n  Three-Year EPS Compound Annual Growth Rate (CAGR)

n  Relative TSR vs. S&P 500

 

PSU

Performance

Metrics†

    UTC Achievement   PSUs Vesting
   Threshold      Target      Maximum       Threshold        Target      Maximum    
           

EPS Growth

 

   

70%  

 

   

100%  

 

   

130%    

 

              

Relative TSR

    37.5th   percentile     

50th  

percentile  

   

75th    

percentile    

              

    †Measurement Period: January 1, 2007 through December 31, 2009

 

 

The Your Stock Awards Web Site

 

Remember that you can view your UTC stock awards online at the Your Stock Awards Web site. Through this Web site, you can obtain comprehensive information about the LTIP, including the Plan Document, Plan Prospectus, and the Schedules of Terms applicable to your award. There are also powerful modeling tools for all your UTC stock awards. You can access the Your Stock Awards Web site as follows:

 

If in the U.S. . . .

   

O

R

         If International . . .
. . . Via the Intranet through Employee Self Service (ESS) on your business unit home page.          . . . Via the Internet from any computer (you need a User ID and PIN) at https://www.wealthviews.com/utc.

 

 

 

What You Need to Do

 

Please sign and date the portion of this statement below the perforation and return it to your local Human Resources representative for delivery to:

 

Stock Plan Administrator

United Technologies Corporation

1 Financial Plaza, MS 504

Hartford, CT 06101

 

 

Grant Date:

 

Type

  

Number of

Units

  

Grant

Price

  

Estimated

Present Value

  

Vesting

Date

   

Expiration

Date

SARs

                     

PSUs*

                     

Total Estimated Present Value:

             

    *PSUs are subject to performance-based vesting criteria

 

The award shown in this statement is subject to the terms and conditions of United Technologies Corporation’s Long Term Incentive Plan (LTIP). I acknowledge this statement of award. I accept this award subject to the 2007 Schedules of Terms and the LTIP. These documents and the Plan Prospectus are available at the Your Stock Awards Web site.

 

Signed:                                                                                                    Date:                                                              

Your 2007 Long Term Incentive Award

Performance. Results. Rewards.

 

Stock Appreciation Rights (SARs)

 

How Do SARs Work?

               
A SAR is similar to a stock option and delivers equivalent value when exercised.       

 

                                An Example

 

n      Receive gain in UTX from date of grant to date of exercise     

Number of SARs granted:

 

   

1,000

 

    LOGO
n    Vests three years after grant date           
n    Expires ten years from the grant date, unless exercised      UTC stock price at grant:    $50 per share   
n    No dividend equivalents     

UTC stock price at exercise:

 

    $75 per share   
n    At exercise, value is delivered in shares of UTC common stock and:      Increase in UTC stock price from   grant date to exercise date:    $75 per share – $50 per  
share = $25 per share		   
     —    Converted to cash at your discretion, OR     

Total Gain from SAR exercise:

 

    1,000 SARs x $25 per share = $25,000   
     —    Held and you receive dividends on the shares      Conversion into shares of UTC stock:    $25,000 ÷ $75 per share = 333 shares   
                            

 

 

Performance Share Units (PSUs)

 

How Do PSUs Work?

 

n    One PSU equals one share of UTC common stock
     —    Vests solely upon the achievement of performance targets over a three year period
     —    Special rules apply for retirement and termination of employment (see Schedule of Terms)
     —    Upon vesting, PSUs are converted to shares and distributed to you
          In the U.S. and most countries, you are taxed on the vesting date
n    Dividends payable on issued shares
n    Opportunity to defer payments of, and therefore taxation on, vested PSUs
     —    U.S. (based on current law) and wherever else viable (subject to local laws)
     —    Share units accrue dividends which are converted to additional share units in deferred account

 

An Upside to Exceptional UTC Performance    LOGO
You can receive up to twice the number of PSUs awarded to you for exceptional UTC performance. Vesting on each metric is measured separately and weighted equally.   
n     UTC’s Earnings Per Share (EPS) growth   
     —    EPS is net income divided by average diluted shares   
     —    Calculated as a Compound Annual Growth Rate (CAGR) over three years   
n    UTC’s rank on Total Shareholder Return (TSR) among S&P 500 companies   
     —    TSR is the change in share price over the three year performance period (plus reinvested dividends) divided by the share price at the beginning of the three year period   
              

 

 
 

 

 

Please sign and date the portion of this statement below the perforation and return it to your local Human Resources representative for delivery to:

 

Stock Plan Administrator

United Technologies Corporation

1 Financial Plaza, MS 504

Hartford, CT 06101