CAP ROCK ELECTRIC
Achievement Based Compensation Agreement
Corporate Asset Non--CFC Financing Arrangements In accordance with Cap Rock
Electric Cooperative, Inc. ("Cap Rock Electric") Board Policy 143, this contract
provides for calculation and payment of achievement compensation in the form of
a percentage of the gross amount of transactions involving financing through
arrangements with lenders other than conventional borrowing from CFC for the
acquisition and ultimate ownership of a Power Transmission Facility which will
interconnect Southwestern Public Service Company's grid with Cap Rock Electric's
distribution system. Such lenders may include, but are not limited to, leasing
companies, commercial banks, investment houses, power suppliers, and other
financing sources. (1) Responsible Individual: -
John D Parker, Director of Finance
(2) Amount of Achievement Based Compensation: The achievement compensation
will be one percent (1%) of the gross amount of the transaction.
(3) Calculation of the Transaction Proceeds: The gross amount of the
transaction is defined as the total proceeds received under the financing
agreement.
(4) Term of Achievement Based Compensation: The achievement compensation
will be paid within two months of the receipt of the final advance of proceeds
from each individual financing transaction.
(5) Payment of Achievement Based Compensation: The achievement compensation
will be paid after the receipt of the final advance of the proceeds after review
and approval by the CEO/General Manager and Board of Directors of this contract.
The achievement compensation will be paid in cash to each eligible
individual in a lump sum unless the amount exceeds $10,000.00, in which case Cap
Rock Electric will have the option to spread the payment over as many months as
necessary so that any one monthly payment does not exceed $10,000.00. The lump
sum payment or series of payments, if applicable, will be made as provided in
Board Policy #143 and with cash availability and overall cash flow of the
Cooperative considered. The eligible individual shall have the option to elect
some or all of the payment to be made to such deferred compensation plans as may
be maintained by the individual or Cap Rock Electric. (6) Condition and
consideration for Payment:
Except upon becoming eligible for benefits under any Cap Electric
retirement plan, either early or regular, the Achievement Compensation will be
payable to the recipients listed below in para. (7) without regard to the
continued employment of those individuals by Ca~ Rock Electric or an affiliate
or subsidiary thereof, provided that, unless otherwise agreed by Cap Rock
Electric, each individual agrees that he will not voluntarily terminate his
employ-merit by Cap Rock Electric or an affiliate or subsidiary of Cap Rock
Electric prior to the shorter of either (A) for a period of three (3) years
following the date of initial payment under this contract, or (B) the date of
the final disposition of a transaction, i.e. the effective date of the ultimate
-assignment of the transaction to a power supplier. In no event, under either
(A) or (B) mentioned in the previous sentence, will the individual voluntarily
terminate his employment by Cap Rock Electric or an affiliate or subsidiary of
Cap Rock Electric less than one year following the date of initial payment under
this contract. Further, each individual agrees that he will keep the terms of
this contract, as well as the tens of the transaction causing the awarding and
payment of the Achievement Compensation, confidential. (7) Sharing with Other
Individuals: In recognition of the necessary contribution of the entire
management team to the continued success of Cap Rock Electric and the successful
implementation of alternate or non--CFC financing arrangements, the Achievement
Compensation will be shared among the Responsible Individual and the other
management team members as follows: Responsible Individual - 50% Management Team
- 50% CEO/GM - 30% -
Other individuals selected by the CEO and Board of Directors - 20% Ulen
North --- 10% Steve Collier -- 10% Except for the confidentiality and retirement
provisions, the conditions for payment described above in para. (6) are not
applicable to those persons identified and listed above as "Other individuals".
It is further understood and agreed that such conditions for payment as set out
in para (6) are applicable subject to the amount of such Achievement
Compensation total payment being commensurate and equitable with the conditions
placed upon the recipients by the acceptance of such Compensation.
In the event the Responsible Party (should violate the terms of this
Agreement, the right to receive future payments under this Agreement
shall immediately cease and such interest or right to future payments shall
revert to Cap Rock Electric. In the event any individual named herein by the
CEO/General Manager and Board of Directors as a part of the Management Team
shall violate the tens of this agreement, die, retire, or terminate their
employment with Cap Rock Electric for any reason, the right to receive future
payments under this contract shall immediately cease and the CEO/General Manager
shall have the right to allocate such share among those named individuals or
others as he may deem in the best interests of the Cooperative.
Witness our hands on this 27th day of October, 1992
/s/ John D. Parker 10-27-92
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Responsible Individual Date
/s/ David W. Pruitt 10-27-92
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CEO Date
/s/ Russell Jones 10-27-92
Chairman Date
