EXHIBIT 10.13

 

 

SUMMARY OF EXECUTIVE OFFICER COMPENSATION ARRANGEMENTS

 

The following is a summary of the current compensation arrangements between
InfraSource Services, Inc. (the “Company”) and its executive officers, with
information provided as of the March 2005 filing date of the Company’s Annual
Report on Form 10-K for the year ended December 31, 2004 (the “Form 10-K
Report”).

 

Cash Compensation.  The Company’s cash compensation package for its executive
officers consists of two components:  (1) base salary; and (2) annual
performance-based bonuses.  The Company also provides stock-based equity
incentive grants to its executive officers as an incentive to retain its
executives and promote ownership in the Company.  Such equity-based grants are
generally issued under the Company’s 2004 Omnibus Stock Incentive Plan that is
filed as Exhibit 10.6 to the Company’s Registration Statement on Form S-1,
originally filed January 30, 2004 and declared effective May 6, 2004 (the
“Registration Statement”).

 

The Company is party to Management Agreements with each of its executive
officers.  Each executive officer’s employment is at-will, subject to the
provisions of the applicable Management Agreement.

 

Base Salary:  Base salaries for executive officers are established in the
Management Agreements with the Company.  The current base salaries for the
executive officers are:

 

Name

 

Title(s)

 

Agreement Date

 

Base Salary as of
March 15, 2005

 

 

 

 

 

 

 

 

 

David R. Helwig

 

CEO and President

 

September 24, 2003

 

$

437,600

(1)

Terence R. Montgomery

 

SVP and CFO

 

September 24, 2003

 

$

260,000

 

Henry E. Jackson(2)

 

President, Dasheill Corporation and Dacon Corporation

 

September 24, 2003

 

$

250,000

 

Stephen Reiten

 

President & COO, MJ Electric

 

September 24, 2003

 

$

200,000

 

Paul M. Daily

 

President & CEO, InfraSoure Underground Services, Inc.

 

September 24, 2003

 

$

240,000

 

R. Barry Sauder

 

VP, Corporate Controller and Chief Accounting Officer

 

April 6, 2004

 

$

180,250

 

 

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(1)           Mr. Helwig’s salary is effective as of April 1, 2005.

(2)           Mr. Jackson retired from the Company effective January 3, 2005.

 

Under the Management Agreements, the base salaries are reviewed annually by the
Board, or any duly authorized committee of the Board, in its sole discretion. 
For Messrs. Helwig, Montgomery, Reiten and Daily, such discretion is limited by
the Management Agreement to the authority to increase (but not decrease) the

 

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base salary paid.  Annual increases, if any, generally occur by March 15, 2005
of each year.

 

Bonus Compensation:  Each executive officer is eligible to participate in the
Annual Incentive Compensation Program (“AICP”) of the Company.  The AICP
establishes corporate goals and individual operating unit goals.  Potential
bonus opportunity is based principally upon sharing in the profitability, cash
flow, economic value added or related financial performance parameters.  Each
executive officer’s goals are established specifically, depending upon his role
with the Company.  For example, executive officers that are in charge of
operating units may have more of their potential bonus compensation tied to such
unit’s performance, while the “corporate” level executive officers potential
bonus compensation is tied to corporate performance measures.

 

The principal AICP measures are net income (at the corporate and operating unit
levels) and EBIT (earnings before income tax),  related measures, with Days
Sales Outstanding (gross accounts receivable minus accounts receivable older
than designated periods and other deductions) and safety related indicators as
potential downward modifiers.  Net income must meet a designated threshold
(determined for each year) before any bonus pool is funded by the Company. 
Specific individual operating unit measures may also be established each year. 
Once threshold funding is achieved, the Board of Directors (or duly authorized
committee of the Board) does have discretion to consider unusual items that
impact the performance measures.  The AICP goals and performance measures for
2005 will likely be substantially similar to those used in 2004, subject to the
discretion of the Board of Directors, or a duly authorized committee of the
Board.

 

In addition to the potential bonus compensation under the AICP, Messrs. Helwig,
Montgomery, Reiten and Daily are eligible for signing bonuses under their
respective Management Agreements.  Such signing bonuses relate to the merger
transaction, which occurred September 24, 2003 in which the Company acquired
InfraSource Incorporated and certain of its subsidiaries from Exelon Enterprises
Company, LLC (the “Merger”).  Seventy-five percent of the signing bonuses to be
paid to the eligible executives were paid, in cash or in shares of common stock,
on September 24, 2003 and the remaining twenty-five percent will be paid if the
executive officer is employed by the Company on September 23, 2005.  The amount
of the signing bonuses are:

 

Name

 

Signing Bonus

 

 

 

 

 

David R. Helwig

 

$

300,000

 

Terence R. Montgomery

 

$

150,000

 

Stephen J. Reiten

 

$

165,000

 

Paul M. Daily

 

$

150,000

 

 

Equity-Based Compensation.  Executive officers are eligible to receive grants
and awards under the Company’s 2004 Omnibus Stock Incentive Plan, and to
participate

 

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in the Company’s 2004 Employee Stock Purchase Plan, which are filed as Exhibits
10.6 and 10.7 to the Company’s Registration Statement.

 

Deferred Compensation Plan.  Each executive officer is eligible to participate
in the Company’s Deferred Compensation Plan, which is filed as Exhibit 10.8 to
the Company’s Registration Statement.

 

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