EX-10.ff
1994
RESULTS
COMPENSATION
PROGRAM
Black Hills Power and Light Company
Wyodak Resources Development Corp.
Western Production Company
RESULTS COMPENSATION PROGRAM
Beginning January 1, 1994, a new program will be implemented into the
current pay program. The program called "Results Compensation" will offer
a significant enhancement to the Corporation's compensation philosophy and
practice.
The new Results Compensation program is designed to recognize and reward
the contribution that group performance makes to corporate success.
Results Compensation can pay financial rewards up to 8 percent of your
earnings.
GROUP PERFORMANCE
There are several elements that go into determining the success of the
Corporation. Some of these elements include: the market, general economic
conditions, quality of management, strategic plans, regulatory agencies and
the contributions employees make to achieving the goals; both on an
individual basis and as part of a work unit.
In general, the current merit/base pay system provides individual pay
opportunities that are competitive in our respective industry and
geographic location coupled with each company's ability to pay. The
emphasis of the Results Compensation program is on rewarding group or
business unit performance.
RESULTS COMPENSATION PROGRAM OBJECTIVES
The Results Compensation program is designed to meet the following
objectives:
- Enhance and broaden the current compensation philosophy and pay
practice.
- Share the results of the Corporation and the business unit with
the people who contribute to that success.
- Motivate work performance and behavior that supports the
Corporate and business unit financial goals.
- Increase the employee's understanding of the business.
RESULTS COMPENSATION GUIDELINES
- The program will encompass a one-year period; January 1, 1994,
through December 31, 1994. Results Compensation awards, if
approved, will be paid out in the first quarter of the following
year.
- Regular full-time and regular part-time employees are eligible to
participate in this program.
- An individual employee's Results Compensation award, if any, will
be paid on gross pay as it appears on the employee's W-2 form.
This includes regular, overtime, paid time off and other forms of
premium pay.
- An employee who transfers between one of the three participating
companies, BHP, WRDC and WPC, during the program year will have
the Results Compensation award, if approved, based upon where the
greatest amount of time worked occurred.
- The local union IBEW, 1250, elected not to participate in the
Results Compensation program. Therefore, bargaining unit
employees will not be eligible to receive a Results Compensation
award.
- An employee who transfers to or from a bargaining unit position
will receive a pro-rated Results Compensation award, if approved,
relative to the amount of time worked in the non-bargaining unit
position and gross pay earned in the non-bargaining unit
position.
- The maximum Results Compensation bonus and award an employee may
receive is 8 percent.
- In determining the bonus percentage to be paid, calculations will
be rounded to two decimal places (e.g., 1.43%) not rounded to the
nearest whole percentage amount.
- Any participating employee whose employment relationship with the
Corporation is terminated voluntarily or involuntarily prior to
the end of the program year will not be eligible for any Results
Compensation award. Exceptions would be death, permanent
disability or retirement.
DETERMINING RESULTS COMPENSATION AWARDS
The Results Compensation program has two key financial goals. The
financial goals consist of a business unit goal and a corporate goal.
Whether a program award is paid and how much any award will be depends on
how well and to what degree the goals were obtained as evaluated by the
Board of Directors.
GOAL 1. FINANCIAL PERFORMANCE OF THE INDIVIDUAL BUSINESS UNIT (BHP,
WRDC AND WPC) BASED ON OPERATING INCOME.
Operating income is all unit revenue, less operating expense, before
corporate income taxes and interest charges. This measures the
financial results of operations.
Participants can receive up to four percent of their total Results
Compensation award from this goal; specifics are attached. Specific
goals will be determined and communicated to each employee of the
respective business unit upon finalization of the budget process.
GOAL 2. CORPORATE CONSOLIDATED EARNINGS PER SHARE (EPS) GOAL.
Earnings per share are equal to the total profit divided by the number
of shares of Black Hills Corporation common stock owned by
shareholders.
Participants can receive up to four percent of their total Results
Compensation award from the goal. Since this is a consolidated
Corporate goal, all employees in the different business units will
have the same goal; specifics are attached. The specific goal will be
determined and communicated to each employee upon finalization of the
budget process.
BOARD OF DIRECTORS RETAIN DISCRETION
This program is not at any time a contract of employment. The Company
reserves the right to change this program whenever and in any manner it
deems appropriate. Irrespective of changes in the program, no rights are
vested. All awards are earned only when and if finally approved by the
Board of Directors notwithstanding anything contained in the program that
may be construed to be to the contrary.
The Board of Directors, in its sole and absolute discretion, may decline to
approve any award, though the participant may have achieved or exceeded
threshold and target levels of performance. Setting a threshold or target
of performance for any participants does not constitute a promise to pay an
award even if the participant meets the threshold or target of performance.
In determining whether to make an award and the amount of the award, the
Board of Directors may consider criteria other than or in addition to the
threshold and target performance determined under this program. Nothing in
this program is a promise by the Corporation to continue to employ any
participant for any period of time.