SOUTHWESTERN PUBLIC SERVICE COMPANY
DIRECTORS' DEFERRED COMPENSATION PLAN
(as amended January 10, 1990)
A Director of Southwestern Public Service Company (the "Company") or a
Director of a subsidiary of the Company which has by a resolution of its Board
of Directors currently in effect elected to permit its Directors to participate
in the Plan (a "Participating Subsidiary") may elect under the Sout hwestern
Public Service Company Directors' Deferred Compensation Plan (the "Plan") to
defer the distribution to him or her of all or a percentage of the annual
retainer or meeting fees or both (whether such meeting fees are for attending a
meeting of the Board of Directors of the Company or a meeti ng of the Board of
Directors of a Participating Subsidiary or a meeting of a Committee of either
such Board) otherwise currently payable to the Director. For the purposes of the
Plan, the annual retainer and meeting fees of a Director are called
"Remuneration."
A Participating Subsidiary is a corporation not less than 50 percent of the
voting equity interest in which is at all times while the corporation is a
Participating Subsidiary owned directly or indirectly by the Company.
Participation in the Plan by a Participating Subsidiary shall automatically
terminate prospectively, effective as of the date such Participating Subsidiary
ceases to meet the requirements for classification as a Participating Subsidiary
set forth in the preceding sentence. Furthermore, a Participating Subsidiary
may, at any time by resolutions of its Board of Directors and by notification to
the Company, prospectively terminate its election to be a Participating
Subsidiary. Such a termination of Participating Subsidiary status, whether
automatic or by resolution of the Board of Directors of the Participating
Subsidiary, shall not affect the Accounts of any Director under the Plan
attributable to Remuneration earned prior to the effective date of such
termination.
An amount equal to any payments made under the Plan attributable to
Remuneration of a Director of a Participating Subsidiary which is deferred under
the Plan shall be paid by the Participating Subsidiary or its successors or
assigns to the Company at the time such payments are made under the Plan by the
Company.
The Plan will be submitted to the stockholders of the Company for their
approval at the Company's 1989 Annual Meeting of Stockholders and will not
become effective unless so approved.
A deferral election under the Plan must be in writing and must be
irrevocable. A deferral election effective for 1989 and subsequent calendar
years (until terminated) (a "1989 election") must be made not later than
December 15, 1988. A 1989 election will be effective for any Remuneration
otherwis e payable to the Director for 1989 services and for any Remuneration
otherwise payable to the Director for services performed in each subsequent
calendar year until the 1989 election is terminated. An individual elected as a
Director who was not a Director at any time during the twelve-month period
preceding the date of his or her election may file a deferral election with
respect to Remuneration for services in the calendar year of his or her election
and in subsequent calendar years (until terminated) (a "newly-elected Director
deferral election"). In order to be effective for the calendar year in which
such a Director's election as Director occurs, the individual must file his or
her deferral election not later than the day preceding the day on which he or
she is elected as a Director. Any Director who does not have in effect either a
1989 election or a newly-elected Director defer ral election may make a deferral
election, effective for any Remuneration otherwise payable to the Director for
services performed in the first calendar year beginning subsequent to the filing
of such election and calendar years subsequent
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thereto (until terminated), by filing such an election not later than December
15 preceding the first calendar year for which the deferral election is to be
effective. Such a deferral election must be in writing and must be irrevocable.
A termination of any Director's deferral election must be in writing and
must be filed not later than December 15 in order to be effective for
Remuneration otherwise payable for services in the succeeding calendar year and
subsequent calendar years. Each deferral election shall be made by filing with
the Secretary of the Company the Director's written irrevocable deferral
election, together with a written designation of any beneficiary or
beneficiaries to receive any balance the Director has to his or her credit under
the Plan upon his or her death. A notice of termination or a statement o f
change in a designated beneficiary shall be in writing and similarly filed. No
such election or notice shall be effective prior to its receipt by the Secretary
of the Company.
Any amount of Remuneration elected to be deferred by a deferral election
shall be credited to a bookkeeping account maintained on the books of the
Company. Such bookkeeping account shall be a Dollar Account or a Stock Account,
as elected by the Director in his or her written deferral election.
On the date on which the Remuneration of a Director affected by a deferral
election would otherwise be paid, the Dollar Account of the Director shall be
credited with the portion of the Remuneration which he or she elected to defer
and have so credited. All Dollar Accounts shall be increased by a n interest
equivalent credited monthly at a rate equal to the Base Rate. "Base Rate" means
at any time the rate of interest per annum then most recently announced publicly
by BANK ONE, TEXAS, N.A., Dallas, Texas ("BANK ONE"), as its base rate. The Base
Rate shall also mean any successor rate that m ay be established by BANK ONE
from time to time. If BANK ONE is no longer in existence or has made no
announcement of such rate for the period stated, the Officers' Compensation
Committee of the Board of Directors of the Company shall select another
reasonable rate in lieu of the above described ra te as announced by BANK ONE.
On the date on which the Remuneration of a Director affected by a deferral
election would otherwise be paid, the Stock Account of the Director shall be
credited with a stock equivalent equal to that portion of the Remuneration which
he or she elected to have so credited. Such stock equivalent sha ll be equal to
the number of shares of common stock of the Company, par value $1 per share
("SPS stock"), to three decimal places, that could be purchased on the day that
such portion of the Director's Remuneration would otherwise be paid, at a per
share price equal to the arithmetical mean of the highest and lowest quoted
selling prices on the New York Stock Exchange Composite Tape for such day. If
there are no sales on that day, then such mean on the next preceding day on
which there are such sales shall be used.
On each date on which a dividend in cash or property is distributed on
shares of issued and outstanding SPS stock, the Stock Account of a Director
shall be credited with a number of shares of SPS stock based upon the amount of
cash or the fair market value of any property (the "base amount") dist ributed
with respect to a number of shares of issued and outstanding SPS stock equal to
the number of shares (including fractions) of SPS stock standing to the
Director's credit in his or her Stock Account on the record date for such
distribution (assuming that fractional shares could be held of re cord and that
distributions were made with respect thereto). The number of shares of SPS stock
to be so credited shall be equal to the number of shares of SPS stock, to three
decimal places, that could be purchased on such dividend distribution date with
the base amount at a per share price equal to
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the mean between the highest and lowest selling prices on the New York Stock
Exchange Composite Tape for that day. If there are no sales on that day, then
such mean on the next preceding day on which there are such sales shall be used.
On each date on which a stock dividend or stock split is distributed on
shares of SPS stock, a Director's Stock Account shall be credited with a number
of shares of SPS stock equal to the number of shares which would have been
distributed with respect to a number of shares of issued and outstandi ng SPS
stock equal to the number of shares (including fractions) of SPS stock standing
to the Director's credit in his or her Stock Account on the record date for such
distribution (assuming that fractional shares could be held of record and that
fractional shares would be distributed).
In the event that the Company shall at any time be consolidated with or
merged with any other corporation and the Company is not the surviving entity,
the amounts credited to each Director's Stock Account shall be a continuing
liability of the continuing entity and the amount of SPS stock credite d thereto
just prior to the merger or consolidation (including fractional shares) shall be
converted into shares of such continuing entity (including fractional shares) or
other consideration on the same basis as issued and outstanding SPS stock is
exchanged for shares of such continuing entity (as suming fractional shares
could have been so exchanged and that fractional shares of the continuing entity
would have been issued) or other consideration. Alternatively, each Director may
demand and receive as of the day preceding the effective date of such
consolidation or merger a cash amount equa l to the number of shares of SPS
stock held in his or her Stock Account on such day multiplied by the mean
between the highest and lowest selling prices for SPS stock on the New York
Stock Exchange Composite Tape on such day or, if there are no sales on such day,
such mean on the next preceding dat e on which there are such sales. Such demand
shall be in writing and shall not be effective unless filed with the Secretary
of the Company not later than the day preceding the effective date of such
consolidation or merger.
Deferred amounts distributed from a Director's Dollar Account shall be paid
in the form of cash, and distributions from a Director's Stock Account shall
(except as hereinafter stated as respects a fractional share) be made in whole
shares of SPS stock, in each case in one of the following ways, a s set forth in
the Director's applicable deferral election:
(a) in a lump sum as soon as practicable following termination of the
service of the Director as such (with a cash equivalent for any fractional share
otherwise distributable from a Stock Account); or
(b) in five annual installments, the first installment to be paid as soon
as practicable following termination of the service of the Director as such.
Each installment shall be in an amount determined by dividing the balance of
cash credited to the Dollar Account or shares of SPS stock credited t o the
Stock Account by the number of payments remaining to be made. In the case of a
Stock Account, the number so produced shall be rounded down to the next highest
number of whole shares and a cash equivalent will be paid for any fractional
share of SPS stock otherwise includable in the last insta llment.
If a Director who has filed a deferral election is not alive at the time
any part of the deferral is to be paid under (a) or (b) above, such payment
shall be made to the beneficiary or beneficiaries, if any, designated in the
Director's deferral election, or in any later written designation of be
neficiary or beneficiaries received by the Secretary of the Company prior to the
death of the Director. If the Director has designated no beneficiary or none of
his or her designated beneficiaries is alive at such payment date, then the
payment shall be made to the estate of the Director.
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If a Director who has filed a deferral election dies while a Director,
payment of his or her Dollar Account or Stock Account shall be made to the
Director's beneficiary or beneficiaries, or, if no designated beneficiary
survives the Director, to the Director's estate in one lump sum as soon as pr
acticable after the death of the Director.
The Plan shall be administered by the Board of Directors of the Company and
may be amended by the Board of Directors at any time in any respect without the
approval of the stockholders. No Director shall, however, vote on any matter
relating to the administration of the Plan or on its amendment w hich relates
solely to himself or herself.
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