RESTATED and AMENDED
PUBLIC SERVICE COMPANY OF NEW MEXICO
ACCELERATED MANAGEMENT PERFORMANCE PLAN
(1988)
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ARTICLE 1
TITLE AND PURPOSE
1.01 Public Service Company of New Mexico ("PNM" or the "Company")
established the Public Service Company of New Mexico Accelerated Management
Performance Plan (the "Plan") on January 14, 1981. On October 23, 1984, the Plan
was amended and restated, and subsequently the October 23, 1984, amended and
restated Plan was amended by three amendments. The Company now wishes to further
amend that Plan and with such amendment, to fully restate the Plan as amended.
1.02 The purpose of the Plan is to encourage personal growth, to improve
productivity and to foster the acceptance of increased responsibility by
providing the participating members of each Company's Executive Pay Group with
supplemental retirement benefits.
1.03 Participation in the Plan by an Employee pursuant to a Joinder
Agreement does not and shall not be deemed to constitute a contract of
employment between the Employer Company and the Participating Employee, nor
shall any provision hereunder, except as may be expressly stated, restrict the
right of the Employer Company to discharge the Participating Employee or
restrict the right of the Participating Employee to terminate employment.
1.04 Following the adoption of the Plan certain companies affiliated
with PNM have adopted the Plan.
ARTICLE 2
DEFINITIONS
The following terms as used herein shall have the meanings specified
below unless the context otherwise requires. The masculine pronouns, where used,
shall include the feminine, and the singular shall, where appropriate, include
the plural.
2.01 "Actuarial Equivalent" shall mean a benefit of equivalent value as
determined by an independent actuary selected by the Company using assumptions
of interest and mortality which reflect his best estimate of future experience
for the Plans. Such Actuarial Equivalents may be different from those utilized
in the Employees' Retirement Plan. The Company's good faith determination of
actuarial equivalents shall be conclusive for all purposes hereunder.
2.02 "Authorized Leave of Absence" means a leave of absence approved by
the Plan Administrator.
2.03 "Average Earnings" means Average Earnings as defined in the
Employees' Retirement Plan.
2.04 "Board of Directors" means the Board of Directors of an Employer
Company.
2.05 "Company" means Public Service Company of New Mexico or any
successor thereto, and any company affiliated with Public Service Company of New
Mexico which adopts the Plan.
2.06 "Deferred Early Retirement Benefit" means Deferred Early
Retirement Benefit as defined in the Employees' Retirement Plan.
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2.07 "Early Retirement Benefit" means Early Retirement Benefit as
defined in the Employees' Retirement Plan.
2.08 "Early Retirement Date" means the date upon which an Employee
retires from the service of a Company pursuant to the provisions of Section 6.03
of the Employees' Retirement Plan.
2.09 "Effective Date" of the Plan as amended shall, as to all
Participating Employees, be August 1, 1988. The Plan, as amended, shall not
adversely or beneficially affect any person not employed on the Effective Date.
2.10 "Employee" shall mean any person employed by a Company who has
been designated as a member of such Company's Executive Pay Group.
2.11 "Employees' Retirement Plan" means the Public Service Company of
New Mexico Employees' Retirement Plan, as amended from time to time.
2.12 "Employer Company" means the Company employing the Employee who is
a Participating Employee.
2.13 "Executive Pay Group" means a management group of employees
designated by the President of the Employer Company.
2.14 "Joinder Agreement" shall mean a signed written agreement by an
Employee to participate in the Plan in a -form approved by the Plan
Administrator.
2.15 "Maximum Performance Credits" shall mean a total of thirty (30)
Performance Credits.
2.16 "Normal Retirement Benefit" means the Normal Retirement Benefit as
defined in the Employees' Retirement Plan.
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2.17 "Normal Retirement Date" means the Normal Retirement Date as
defined in the Employees' Retirement Plan.
2.18 "Participating Employee" shall mean an Employee who, as of August
1, 1988, had met the eligibility requirements of Article 3 hereof, had executed
a Joinder Agreement and had that Joinder Agreement accepted by the Plan
Administrator.
2.19 "Performance Credit" means credit earned toward accumulating
Maximum Performance Credits.
2.20 "Plan means the Public Service Company of New Mexico Accelerated
Management Performance Plan as described herein or as hereafter amended.
2.21 "Plan Administrator" means the person designated by the President
of PNM as the Plan Administrator of the Plan.
2.22 "Plan Year" means the fiscal year of the Company.
2.23 "Service Bonus Plan" means the Public Service Company of New
Mexico Service Bonus Plan, as amended from time to time.
2.24 "Terminated Participant" means a Participating Employee who:
2.24.1 Before accumulating Maximum Performance Credits and attaining
his Early Retirement Date, ceases to be an employee of the Company.
2.24.2 Before accumulating Maximum Performance Credits and attaining
his Early Retirement Date, ceases to be a Participating Employee pursuant to a
Resolution adopted by the Board of Directors.
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2.24.3 Dies prior to electing Early Retirement Benefit, Deferred Early
Retirement Benefit or Normal Retirement Benefit under the Plan, or
2.24.4 After accumulating Maximum Performance Credits, fails to elect
an Early Retirement Benefit or Deferred Early Retirement Benefit for any reason
other than deferral, at the specific invitation of the Board of Directors.
2.25 "Year means the period of twelve (12) consecutive calendar months
beginning on the first day of the month following the date an Employee became a
member of the Executive Pay Group or any anniversary thereof.
2.26 "Year of Service" means each Year of service as defined in the
Employees' Retirement Plan.
ARTICLE 3
ELIGIBILITY
3.01 Employees Eligible to Be Included in Plan. Only Employees now
covered by the Plan are eligible to be Participating Employees. No additional
Employees may be added to the Plan. A List of Eligible Employees now in the Plan
is attached hereto as Exhibit A.
ARTICLE 4
PARTICIPATION
4.01 Each Participating Employee will receive one (1) Performance Credit
for each Year of Service plus additional Performance Credit for each Year in
accordance with the following schedule:
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Executive Pay
Group Grade Additional Performance Credit for Each
Level Year of Membership
- ------------- -----------------------------------------------------------
1985 1990
and prior 1986 1987 1988 1989 and after
--------- ---- ---- ---- ---- ---------
One 1.00 .80 .60 .40 .20 .00
Two .80 .64 .48 .32 .16 .00
Three .60 .48 .36 .24 .12 .00
Four .40 .32 .24 .16 .08 .00
Performance Credits shall be calculated in monthly increments, on the basis of
calendar months. For purposes of determining Years of membership in the
Executive Pay Group, service for any part of a calendar month shall be
considered one full month's credit.
4.02 Performance Credits during an Authorized Leave of Absence shall be
determined by the Plan Administrator, consistent with the Employee Retirement
Income Security Act of 1974, as amended.
4.03 No additional Performance Credits will be earned by a
Participating Employee after the occurrence of any of the following events:
4.03.1 The death of the Participating Employee.
4.03.2 The Participating Employee becoming a Terminated Participant.
4.04 A Participating Employee who has accumulated the Maximum
Performance Credits may, the specific invitation of the Board of Directors,
defer electing an Early Retirement Benefit. In such event, the benefits
available under this Plan will become payable under Article 5 upon expiration of
the deferral period and election of an Early Retirement Benefit or a Deferred
Early Retirement Benefit by the Employee.
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ARTICLE 5
BENEFITS
5.01 Benefit of Employee Prior to Accumulating Maximum Performance
Credits.
5.01.1 A Participating Employee, upon termination of employment after
attaining his Early Retirement Date but prior to accumulating the Maximum
Performance Credits, shall receive an annual benefit for his life in an amount
equal to two percent (2%) times his Average Earnings times his Performance
Credits, reduced, if he has not attained his Normal Retirement Date, by two and
four-tenths percent (2.4) for each Performance Credit less than the Maximum
Performance Credits, payable in monthly installments commencing the month in
which his Early Retirement Benefit or Deferred Early Retirement Benefit
commences and further reduced by the Employees' Early Retirement Benefit or
Deferred Early Retirement Benefit, as the case may be, paid under the Employees'
Retirement Plan.
5.01.2 A Terminated Participant shall not receive a benefit under the
Plan.
5.02 Benefit of Employee Accumulating Maximum Performance Credits. A
Participating Employee electing an Early Retirement Benefit or Deferred Early
Retirement Benefit upon accumulating Maximum Performance Credits, in lieu of the
benefit under Section 5.01 hereinabove, shall receive an annual benefit for his
life in an amount equal to the percentage of Average Earnings in accordance with
the following schedule, payable in monthly installments commencing the month in
which his Early Retirement Benefit or Deferred Early Retirement Benefit
commences:
Maximum Performance Percentage of
Credits Earned Prior to Average Earnings
- ------------------------------- ----------------------------------
01/01/86 65%
01/01/87 64%
01/01/88 63%
01/01/89 62%
01/01/90 61%
On or after 01/01/90 60%
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The benefit hereunder shall be reduced by the Employee's Early Retirement
Benefit or Deferred Early Retirement Benefit paid under the Employee's
Retirement Plan.
5.03 Method of Distribution: Notwithstanding any other provision of
this Plan, the form of payment of benefits hereunder shall be the same as the
form of payment of benefits selected by the Participant under the Employee's
Retirement Plan. The payment of the Actuarial Equivalent of the life only
benefit under the Plan shall relieve the Company of further obligation to such
person under the Plan.
5.04 Participating Employees Receiving Benefits. Participating
Employees receiving benefits under the Plan as of the Effective Date of the Plan
as amended, shall continue to receive benefits under the Plan in effect prior to
the Effective Date of the restatement and amendment.
ARTICLE 6
SOURCE OF PAYMENTS
6.01 Unfunded Plan. The Plan is an unfunded, nonqualified plan. It is a
condition of this Plan, and any Participating Employee herein expressly agrees
to look solely to the Employer Company for the payment of benefits under the
Plan. Such payments shall be made from funds provided under a trust established
by the Employer Company, if any, and the general funds of such Employer Company.
The Employee or any other person or persons having or claiming a right to
payments hereunder shall rely solely on the unsecured promise of the Employer
Company set forth herein. Nothing in this Plan shall be construed to give the
Employee or any such person any right, title, interest, or claim in or to any
specific asset, fund, reserve, account, or property of any kind whatsoever,
owned by the Employer Company or in which the Employer Company may have any
right, title or interest now or in the future or against any Company that is not
the Employer Company. However, the Employee or any such person shall have the
right to enforce a claim against the Employer Company in the same manner as any
other unsecured creditor of the Employer Company.
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6.02 Company Liability. Each Employer Company shall create and credit
to a special account on its books such amounts as may be necessary to effectuate
and maintain the Plan on a sound actuarial basis. At its own discretion, an
Employer Company may purchase such insurance or annuity contracts or other types
of investments as it deems desirable in order to accumulate the necessary funds
to provide for the future benefit payments under the Plan or may establish one
or more trusts for such purpose. Notwithstanding anything to the contrary
herein, an Employer Company shall be under no obligation to fund in advance the
benefits provided under this Plan nor shall the investment of Employer Company
funds credited to a special account established hereunder be restricted in any
way and such funds shall be available for any purpose the Employer Company may
choose, other than funds contributed a trust established by the Employer
Company, if any.
ARTICLE 7
FORFEITURES
7.01 Benefits Nonforfeitable. All benefits under Article 5 shall be
nonforfeitable, except as provided in Section 7.02.
7.02 Forfeitures for Cause. No benefits shall be payable to the
Participating Employee if the Participating Employee fails to elect an Early
Retirement Benefit or Deferred Early Retirement Benefit under the Plan upon
attaining Maximum Performance Credits, except in the event of deferral of such
election at the specific invitation of the Board of Directors.
ARTTCLE 8
PLAN ADMINISTRATION
8.01 Administration of Plan. The Board of Directors hereby vests the
Plan Administrator with all powers and authority necessary to administer the
Plan as herein provided, and with the authority to make such rules and
regulations of uniform application as deemed necessary to carry out the
provisions of the Plan. The Plan Administrator shall have the exclusive right to
interpret the provisions of the Plan and to determine any questions arising
thereunder or in connection with the administration thereof. Any decision or
action of the Plan Administrator shall be conclusive and binding upon all
Participating Employees and Terminated Participants.
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8.02 Reliance on Reports and Certificates. The Plan Administrator may
rely conclusively upon all tables, valuations, certificates, opinions and
reports furnished by an actuary, accountant, counsel or other person who may
from time to time be employed or engaged for such purposes.
ARTICLE 9
AMENDMENT AND TERMINATION
9.01 General. The Board of Directors may at any time amend or terminate
the Plan as to such Company, subject to the limitations set forth in section
hereof. An amendment or termination shall have no effect upon any other Company
until the Board of Directors of such other Company adopts the amendment or
termination.
9.02 Restrictions on Amendment or Termination. The Board of Directors,
in terminating the Plan or amending the Plan to reduce benefits shall require
such Company to:
9.02.1 Continue to make payments to each Participating Employee
receiving benefits or who has terminated employment and is entitled to receive
benefits as if the Plan had not been amended or terminated.
9.02.2 Pay all benefits theretofore accrued by each Participating
Employee who has attained his Early Retirement Date at the date the Plan is
terminated or amended to reduce benefits, when such Employee retires as if the
Plan had not been amended or terminated, and
9.02.3 Pay each Participating Employee, who has not attained his Early
Retirement Date at the date the Plan is terminated or amended to reduce
benefits, a benefit, payable when he retires, equal to his Deferred Early
Retirement Benefit or Normal Retirement Benefit, for a period of months prior to
his Deferred Early Retirement Date or Normal Retirement Date, as the case may
be, equal to his Performance Credits in excess of his Years of Service at the
date the Plan is terminated or amended to reduce benefits multiplied by twelve
(12).
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9.03 Successors to Business of Company. The obligation of an Employer
Company under the Plan shall be binding upon any successor to the business of
such Employer Company whether upon sale of all or substantially all of the
assets of such Employer Company, merger, consolidation or similar
reorganization. A Company shall not sell all or substantially all of its assets
or participate in any merger, consolidation or similar reorganization as to
which it is not the surviving entity unless the successor to the business of
such Company or other surviving entity, by whatever form or manner resulting,
shall continue the Plan as to it by executing an appropriate supplementary
agreement; and such successor or surviving entity shall thereupon succeed to all
the rights, powers and duties of such Company hereunder. The employment of any
Employee who has continued in the employ of such successor or surviving entity
shall not be deemed to have been terminated or severed for any purpose
hereunder.
9.04 Dissolution of a Company. In the event that a Company is dissolved
or liquidated by reason of bankruptcy, insolvency or otherwise, without any
provision being made for the continuance of this Plan by a successor to the
business of such Company, the Plan shall be treated as terminated subject to the
rights of Participating Employees of such Company to receive benefits hereunder
as provided in Section 9.02, and the Actuarial Equivalent of such benefits, at
the option of the person entitled thereto, shall be paid immediately in one lump
sum, to the extent permitted by law.
ARTICLE 10
MISCELLANEOUS
10.01 No Alienation. The benefits provided hereunder shall not be
subject to alienation, assignment, pledge, anticipation, attachment,
garnishment, receivership, execution or levy of any kind, including liability
for alimony or support payments, and any attempt to cause such benefits to be
subjected shall not be recognized, except to the extent as may be required by
law.
10.02 Appointment of Person to Receive Payment. If, within one (1) year
after written notice from the Employer Company or the Plan Administrator mailed
to any person entitled to a payment hereunder at such person's last known
address as shown on the Employer Company's records, such person or a legal
representative shall not have notified the Plan administrator in person or
writing of his or her address, then the Plan Administrator may appoint one or
more of the spouse, the blood relatives or the legal representative of such
person to receive such amount, including any amount thereafter becoming due to
such person (or such person's estate), in the proportions determined by the Plan
Administrator. Any action of the Plan Administrator taken hereunder in good
faith shall be conclusive and binding upon all persons.
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10.03 Incapacity of Payee. If the Plan Administrator determines that any
person to whom a benefit is payable is legally incapacitated, the Plan
Administrator may direct that any payment becoming due to such person (unless
claim shall have been made therefor by a duly appointed legal representative) be
applied for such person' s benefit, or paid to or applied for the benefit of
such person's spouse, children, a parent or other blood relative, or paid to a
person with whom such incompetent person resides, and any such payment or
application so made shall be a complete discharge of the Employer Company's
obligations.
10.04 Construction and Governing Law. In any question or interpretation
or other matter of doubt, the Plan Administrator and the Employer Company may
rely upon the opinion of counsel for the Employer Company or any other
attorney-at-law in the State of New Mexico designated by the Employer Company
with the approval of the Board of Directors. The provisions of this Plan shall
be construed, administered and enforced as a contract in accordance with the
laws of the State of New Mexico.
10.05 Entire Plan. The Plan established on January 14, 1981, and
subsequently amended, restated and further amended, is now set forth herein and
incorporated in one document with all changes, revisions and modifications
merged herein.
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IN WITNESS WHEREOF, the Company has caused this amended and restated Plan
to be adopted as of this 16th day of August 1988.
PUBLIC SERVICE COMPANY OF
NEW MEXICO
By /s/ J. D. Geist
----------------------------------------
Jerry D. Geist
Chairman and President
ATTEST:
/s/ J. B. Mulcock, Jr.
- -----------------------------------
Secretary
MEADOWS RESOURCES, INC.
By /s/ James F. Jennings, Jr.
----------------------------------------
James F. Jennings, Jr.
President and
Chief Executive Officer
ATTEST:
- -----------------------------------
Secretary
PARAGON RESOURCES, INC.
By /s/ J. L. Wilkins
----------------------------------------
Its President
----------------------------------------
ATTEST:
/s/ J. B. Mulcock, Jr.
- -----------------------------------
Secretary
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SUNBELT MINING COMPANY, INC.
By /s/ A. J. Robison
----------------------------------------
Its President
----------------------------------------
ATTEST:
/s/ J. B. Mulcock, Jr.
- -----------------------------------
Secretary
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EXHIBIT A
COMPANY: ESBU
Donald A. Begley
Garth Boyce
Larry Edwards
William M. Eglinton
Eugene W. Fisher
Jerry L. Godwin
Patrick J. Goodman
George W. Gorman
Ronald H. Hallford
Dennis E. Hines
Edward A. Jeffers
Olin A. Kane
Edward L. King
Edward D. Kist
Edwin A. Kraft
Robert E. Lowry
Alfonso R. Lujan
Jack D. Maddox
Richard L. Martinez
Martha A. McDonald
Ronald F. Mershon
William J. Moye
John P. Ortiz
Terry L. Othick
Daniel J. Peck
Don Pierce
Billy H. Ransdell
Lawrence D. Ratliff
Gary R. Sloman
Michael C. Slota
Jeffry E. Sterba
Dale E. Stolz
Larry D. Sullivan
David K. Summers
Charles Thompson
Frank M. Van Gundy
William R. Watson
Jack L. Wilkins
Ellen A. Wilson
Robert M. Wilson
William C. Wygant
Ely Yao
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COMPANY: PARAGON
Alfred C. Underwood
COMPANY: SUNBELT
Terry Bauer
Martin A. Clifton
Charles E. Hunter
COMPANY: MEADOWS
Bruno E. Carrara
James F. Jennings, Jr.
Charlie R. Mollo
Roger C. Rankin
John H. Von Rusten
COMPANY: GCNM
John T. Ackerman
Richard A. Jordan
Ted H. Morse
Henry 0. Pocock
COMPANY: CORPORATE
John P. Bundrant
Jerry D. Geist
Billy D. Lackey
Mitchell J. Marzec
James B. Mulcock, Jr.
Joellyn K. Murphy
Robert S. Murray
Fred L. O'Cheskey
Albert J. Robison
David P. Rusk
John H. Smalley
Robert B. Starnes
Tom C. Wray
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